Whistler Blackcomb Holdings Inc. (TSX: WB) (the “Company”) today announced details of its plans for Whistler Blackcomb Renaissance (“Renaissance”), the largest and most exciting investment in the Company’s history. Renaissance will see over $345 million invested in three phases in new weather-independent experiences, on-mountain improvements and real estate developments with the objective of accelerating the Company’s vision of becoming the number one mountain resort in the world to play, to work and to invest. These investments will further solidify and enhance the Company’s reputation as one of the world’s greatest four-season mountain resorts and will build on its year-round appeal to all guests, particularly families.
Renaissance includes three phases of investment that will add new, year-round attractions and activities, see major on-mountain winter and summer improvements, and revitalize Blackcomb’s upper and lower base areas.
“Whistler Blackcomb Renaissance is the most progressive investment in our history and will leverage our tremendous success building our non-ski business. Renaissance will further diversify our revenue and enhance the activities available for our guests while elevating Whistler Blackcomb’s core skiing, mountain biking and sightseeing experiences and continuing our evolution as one of the industry’s leading four-season mountain resorts,” says Dave Brownlie, the Company’s President and Chief Executive Officer. “This is a very exciting growth initiative that, we expect, will increase year-round visitation to Whistler, insulate our resort from variable weather conditions, and strengthen Whistler’s position as one of the premier mountain resort destinations in the world.”
The Company expects the three phases of Renaissance will include:
Phase One: An estimated $90 – $100 million investment in new mountain adventure experiences designed to redefine how guests play at Whistler Blackcomb. The Company expects phase one to bring the following new attractions and amenities to Whistler:
- The Watershed, a year-round, indoor adventure center focusing on water-based play located at Blackcomb’s upper base. The Company envisions the Watershed as a 163,000 square foot facility featuring activities like waterslides, the latest deep water surf simulator technology, cliff jumping and rock climbing experiences, a wave pool, hot and cold pools, bowling, food & beverage facilities and retail amenities, as well as other weather-independent activities;
- A new high-speed lift to replace the Magic Chair and connect Blackcomb’s upper and lower bases;
- A year-round mountain coaster, a tree-top ropes course, and ATV and snowmobile activities for kids;
- New snow school learning zones, a night skiing zone, and enhanced snowmaking on Blackcomb Mountain; and
- Major improvements to Whistler Blackcomb’s existing sightseeing, hiking and mountain biking experiences, with the addition of a suspension bridge and viewing platforms at the peak of Whistler Mountain, and an expansion of the Whistler Mountain Bike Park into the Creekside zone, including 50 kilometers of new downhill mountain biking trails.
The Company anticipates Renaissance phase one will position Whistler Blackcomb to welcome new ski and non-ski visitors and generate meaningful incremental revenue and free cash flow once construction is complete.
Phase Two: An estimated $105 – $115 million investment in a new day lodge and snow school facility within the Watershed indoor adventure center on Blackcomb Mountain, a two-storey parking complex at Blackcomb’s upper Base II area, and other infrastructure projects to lay the foundation for Renaissance phase three. The Company’s current plans for phase two also include the development and sale of approximately 60 high-end, ski-in ski-out townhomes near the Watershed, totaling approximately 160,000 net saleable square feet.
Phase Three: An estimated $140 – $150 million investment in a major revitalization of Blackcomb’s base area in the Upper Village, which the Company currently expects to include an upgraded day lodge and skiers’ plaza, a new snow school facility and a luxury real estate development project. Phase three is designed to transform Blackcomb’s base area into a vibrant, upscale village community. The Company anticipates Renaissance phase three will also include major on-mountain improvements such as lift improvements and the development of an indoor action sports training facility designed to expand the Company’s youth development programs in skiing, snowboarding and mountain biking.
Conditions for Construction and Timing
Renaissance is subject to satisfaction of a number of conditions, including municipal and provincial government approvals, the successful renegotiation and extension of Whistler Blackcomb’s Master Development Agreements (“MDAs”) and master plans, completion of consultations with the Squamish and Lil’wat First Nations, and negotiation of a proposed business partnership with those First Nations. The Company estimates the construction period for phases one and two will be approximately four to five years, and expects to open the Watershed to the public within two years of the above conditions being met.
Regarding the renewal of the MDAs and master plans, which is a high priority for the Company, Brownlie, adds, “We continue to be in active discussions with the Province and the Squamish and Lil’wat First Nations to secure the renewal of our MDAs and master plans to pave the way for Renaissance. Whistler is in the Squamish and Lil’wat First Nations traditional territories and we want to partner with these important stakeholders to benefit our shareholders and our communities. To that end, we have recently signed a Memorandum of Understanding that sets out the basis on which we will be working together for the coming year. It’s an exciting time for our Company and our communities and we look forward to executing on the most ambitious project in our history in full collaboration with the Province, the Resort Municipality of Whistler and the Squamish and Lil’wat First Nations.”
Return on Investment
The Company expects Renaissance to generate incremental returns well in excess of its weighted average cost of capital. Each phase and discrete component of the Renaissance strategic plan will be subject to the discipline and risk management practices that the Company has successfully used for the $114 million of growth and maintenance capital investments made over the past five years. The investments under Renaissance are not expected to have any adverse impact on the Company’s ability to participate in other growth opportunities and maintain its current quarterly dividend.
Financing and Real Estate Risk Management
The Company intends to finance all of the capital costs associated with Renaissance with its free cash flow and revolving credit facility, with the exception of the phase two townhome project and the phase three luxury real estate development project (the “Real Estate Projects”). The Company intends to minimize the financing, construction, and marketing risks associated with the Real Estate Projects through various potential strategies, which may include the sale of the Real Estate Projects once rezoning is approved, a joint venture with a real estate development partner and other strategies as appropriate. The estimated real estate development costs are included in the total investment amounts above. The Company currently estimates the cost of the phase two townhome development will be approximately $80 – $85 million and the cost of the phase three luxury real estate development will be approximately $90 – $95 million. The Company intends to use the real estate projects as a means to unlock capital to fund a portion of the Renaissance investments and does not view these discrete real estate development projects as a significant change in the Company’s strategic focus.
Whistler Blackcomb Renaissance Website
Additional information about Renaissance is available on the Renaissance website at http://renaissance.whistlerblackcomb.com/
Whistler Blackcomb Master Plans
The Company’s draft master plans are available at http://www.whistlerblackcomb.com/holdings/financial-reports-filing-documents