Skiing returns to Baldy

When Fred Johnston was first approached about getting the Mount Baldy ski resort back on its feet, the idea wasn’t on his radar.

“It’s not so much that I was skeptical as that I wasn’t looking for it,” said Johnston, the president of Baldy Capital Corporation and the man who has made a big bet on the ski mountain’s future.

On Friday morning, surrounded by local dignitaries, Johnston cut the ceremonial ribbon to open officially the ski resort that has been closed since early 2013.

Soon afterwards, skiers began riding the Sugarlump quad chair up the hill for a day of skiing. Despite the thick clouds at lower elevations, the hills of Mount Baldy were lit up with sunlight under a clear blue sky.

Some of the skiers, like James Graham, had already been back on the hill the previous Sunday when it was opened to residents of the village only.

Graham has been coming to Baldy since its first season in 1968. The former Osoyoos resident, who now lives in Midway, owns a condominium chalet in the village.

When the hill was closed during the 2013-14 season after its American owners ran into financial difficulties, Graham continued skiing. But with no lifts running, he had to hike up the mountain.

The closure was a big disappointment, he said.

“We were all really quite devastated and worried,” said Graham. “Thanks to Matt [Koenig, the mountain manager] and all the people that were involved, here we are. The dream continues.”

For Johnston, who has run numerous other business ventures in software, diagnostic imaging and real estate, running a ski resort is something new. What background does he have?

“None whatsoever,” he replied. “Except having skied a few mountains.”

With skilled staff handling the day-to-day operation of the resort, Johnston sees his role as largely administrative and financial and giving the staff the support they need to do what they already can do.

“The business aspects are the same whether it’s selling cars or widgets or snowmobiles or ski lifts or whatever,” said Johnston, 66, who has lived most of his life in Calgary with a stint in Kelowna.

Despite his lack of experience with running a ski resort, Johnston spent considerable time doing his homework and analyzing the figures that were available.

One shocking statistic told the story of Mount Baldy, Johnston explained in a lunch hour talk to the Rotary Club of Osoyoos last Thursday.

In 1977, when the hill had just one T-bar, 45,000 skier visits were recorded.

“To my surprise and puzzlement, by 2003, the (number) was down to about 25,000 and it continued to decline from there as the capacity increased,” Johnston told the Rotarians.

The addition of a double chair and a quad chair only saw numbers continue to decline until 2012 when only about 7,500 skier visits were recorded in its last year of operation.

“It was a very difficult business to analyze,” Johnston admits. “There were a lot of pieces and a lot of unknowns and difficulties in seeing how the pieces connected. The more I analyzed it, the more comfortable I got with the fact that it could be simplified. My objective was to simplify it to the point where I could understand it and rationalize that it was something that could be profitable.”

Although Johnston believes the first year back in business could see a loss of around $300,000, he became convinced after hearing from people in the community that it was necessary to open this year.

The enthusiasm in the community needed to be captured and taken advantage of immediately, he said, rather than allowing it to subside by waiting another year.

“The second thing was that the sooner we got our hands dirty and had our hands on the wheel of the machine, the sooner we could start making improvements,” he said. “We will obviously lose money this season and it will be a lower ridership than if we had the time to plan ahead, but it will benefit us next year sooner.”

The resort, he said, will be managed on a five-year plan aimed at increasing the number of skiers back closer to historic highs and up from the historic lows when the hill closed.

Johnston believes the previous owners put too much focus on the expectations of profits from real estate without paying attention to the operation of the ski hill.

Calling Mount Baldy “a diamond in the rough,” he said the focus now must be on improving the quality of the skier experience.

“We decided back in October or November that if we were going to try to take this on and recover, we would have to focus on the operation of the ski hill,” he said. “Without the ski hill, the real estate has no value.”

Revenue from the ski hill, while important, won’t pay the cost of acquisition over the next five years, he said.

Real estate is what will repay the investment, but the two need to go hand in hand.

While Baldy Capital Corporation will be running the resort, it won’t be able to purchase the assets until a receivership and bankruptcy process is completed in the courts. That could take until April, Johnston said.

This year the resort is offering sharply discounted day and seasons passes in a bid to win back local skiers and encourage people to try Mount Baldy out.

Dave Howard, the vice president communications and Johnston’s partner, believes that many other resorts have made skiing unaffordable.

“We put a ticket price there that is attainable,” Howard said. “So that people can maybe come out and rediscover skiing again.”

Initial efforts will focus on the local community, he added, with efforts to draw skiers from further away happening over a longer time period.

Rather than making promises and underachieving, Howard said the aim is to limit promises and to achieve more.

Aside from price, Mount Baldy offers other advantages of the larger neighbouring resorts of Apex and Big White, Howard said.

“You have more sun during the day than at the other two,” he said.

Also, with Mount Baldy only open from Friday to Sunday, there’s a chance for snow to accumulate leading to better skiing, he said.

Many of the staff members from before are back, including Koenig as mountain manager.

“There is absolutely no doubt that Matt Koenig was instrumental in the decision to go forward,” said Johnston. “Matt is superhuman. He can do everything. He’s a one-man band here and without him this hill would not have opened.”

Koenig, however, is more modest, crediting his colleagues, the investors and the community.

Maintenance normally takes place in the warmer summer months, but with a deal still not firm until the fall, much of the work of repairing lifts and other facilities had to be done in colder weather, Koenig said.

He admits he was on pins and needles about the ski resort’s future until close to the final hour. Nonetheless, he kept the faith and hung in.

“In spite of friends and peers saying ‘Matt this is crazy,’” he said. “I believe in the place and I want it to be open so I hung in there.”

Now he plans to focus on getting the inside facilities operating, including obtaining food and beverage licenses.

The Eagle chair remains closed, but work will be done on it as time permits.

Local dignitaries who showed up for the ribbon cutting believe the reopening of Mount Baldy will provide an important economic boost for the area.

Oliver Mayor Ron Hovanes pointed to the long historic connection between Oliver and Mount Baldy as local families grew up skiing on the hill.

“I think it’s great news,” said Hovanes. “It’s such a huge asset, especially for the people that live up here as well. Everybody that comes up here to ski knows that some of the best powder snow anywhere in the province is found here. It’s a quiet little hill and there are no lineups.”

Gail Scott, managing director of Destination Osoyoos, believes that Mount Baldy will help to attract visitation to the area all year round, contributing to economic development.

“I think it will be slow the first year for sure, because it’s not fully operational,” she said. “But as we build our marketing packages around the resort hotels, I do think that we’ll see in the second season a lot more winter overnight accommodations and a lot more restaurants with people in them.”

South Okanagan Chamber of Commerce President Myers Bennett sees the reopening of Mount Baldy as a further boost to the area along with such other developments as the new correctional centre in Oliver and the return of horse racing in Osoyoos.

Chalet owner Susan Webster, from Oliver, has been coming since Mount Baldy opened in 1968. She missed the Sunday preview for village residents, but was back on skis on Friday to try the hill again.

“It’s wonderful,” she said. “It’s an injection in the economy and everybody’s been looking forward to it.”

RICHARD McGUIRE

Osoyoos Times