The risks climate change poses to businesses that rely on winter tourism are clear, despite Swiss ski resorts defying an unseasonably warm January this year with strong occupancy recovery and rates that outstripped pre-pandemic levels.
Although some investors are seeing opportunities in mountain resorts compared to the extremely competitive beach resort market, and the potential to draw in guests looking for health and wellbeing, with winters getting warmer, this means fewer days for the kind of snow sports that attract visitors to the mountains during the winter months.
Based in Laax, Graubünden, tourism and leisure business Weisse Arena Gruppe (WAG) encompasses lift facilities; hotels and restaurants; sports and rental shops; a ski, snowboarding and bike school; and a construction company.
The six accommodations it owns in the region include rocksresort, offering 206 chic and family-friendly apartments amidst the restaurants and shops at Laax lift station, which also operate on a ‘buy to use and let’ model; the four-star, chalet-style signinahotel; and the modern Riders hotel with a vegetarian restaurant and cultural programme.
Along the slopes are the more simply and functionally designed accommodations, such as the 45-bedroom GALAAXY Mountain hostel; Segneshütte, one of the oldest mountain huts in the region; and Berghaus Nagens, which includes dorm rooms. All are currently closed to facilitate works on the resort and are due to reopen in time for the winter season in December.
Although the owned and operated resort model is common in North America, it’s less common in Europe, and WAG is the first and still only Swiss resort run under this model.
Alarmed by the changing climate and threats it poses to both the community and business, WAG set up the Greenstyle Foundation in 2016, dedicated to preserving the local environment, which is run as a separate non-profit organisation with fundraising support from WAG.
A key focus is converting the resort to renewable energy and reducing energy consumption – an approach other hoteliers have said is the key to hotel ESG targets. All of WAG’s electricity has been hydro powered since 2008 and the group has estimated that the implementation of more than 60 efficiency measures in recent years has saved approximately 500,000 Swiss Francs per year, with the potential for further savings of at least another 1.1 million Swiss Francs.
While many recognise the importance of a sustainable hotel sector, a concern in the industry given existing cost pressures is the cost of transition and return on investment (ROI). The ROI on some of WAG's projects has been three to four years, such as smart LED light installation and snow cannon shaft heating controls that reduced energy consumption by around 40 per cent, while the return on water-saving fittings was seen in less than a year.
“Energy efficiency measures have a positive ROI and are not just helping to achieve the environmental goals but also are financially viable. The cheapest renewable energy we can get for our business is solar energy we produce by ourselves on our building infrastructure,” says Reto Fry, WAG’s environmental representative and a Greenstyle Foundation trustee. “It should be worth the money because we are profiting from all these initiatives.”
Current projects including the electrification of its vehicle fleet and the refurbishment of its buildings to remove oil heating systems. The refurbishment of its Crap Sogn Gion mountain station, one of the biggest and most inefficient energy consumers in the group’s portfolio, is due to complete in 2026 at a cost of around 35 million Swiss Francs.
The plan is to achieve maximum energy efficiency and self-sufficiency, with solar panel integration expected to cover around 75% of the station’s energy consumption, as well as reduce the annual energy consumption –around 150,000 litres of heating oil, 400,000 kWh of electricity and six million litres of drinking water – by 75%.
Meanwhile, a new ‘on demand’ gondola system, the FlemXpress, is expected to consume 50% less energy than its predecessor. The group has no plans to open any further hotels although it is expanding the rocksresort, with two further buildings each with eight apartments due to come online by 2025.
As well as finding value in energy efficiency, the initiatives are also attracting guest attention. Over 90% of respondents to a WAG survey said they appreciated the group’s sustainability efforts.
“It is part of our service standards,” says Fry. “There are people who come to Laax because they know we do our best and they can come with a clear conscience.”
And in 2019/20, media reports about Greenstyle reached more than 400 million people – the equivalent of 700,000 Swiss Francs worth of advertising.
“It’s creating value, it’s free advertising,” Fry adds.