 Poster: A snowHead
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Obviously A snowHead isn't a real person
Obviously A snowHead isn't a real person
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Yellowstone Club filing for bankruptcy was the headline of the local paper. A couple months ago Yellowstone announced they found new financing with another company but that apparently fell through. No one is surprised as many locals (including a couple of my neighbors) haven't been paid by them for a few months. I guess there isn't much of a market for 8 million dollar vacation homes these days.
It will be interesting to see if they can come out of bankruptcy by selling assets or if the whole thing will be liquidated. They have lots of undeveloped ski acreage on Lone Mountain both Big Sky and Moonlight would love to gain access to. (Moonlight isn't in much of a position to buy anything from the Yellowstone club as they are barely keeping afloat themselves.)
Yellowstone Club is a classic example of the hubris and greed that swept through the US this decade. A few years ago when real estate was peaking the founder, Tim Blixseth, tried to squeeze out some minority partners, which included Greg Lamond the Tour de France champion. He also tried to stiff his wife, who he was separated from. He offered the minority partners a buy-out significantly less than what their portion was worth so the minority partners sued & won. Unfortunately for Blixseth, he had to pay the minority partners the value of their share a couple years ago, instead of current value, and with speculative real estate sales down he couldn't come up with the money.
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Well, the person's real but it's just a made up name, see?
Well, the person's real but it's just a made up name, see?
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Our SSD was told last night that the YC's ski mountain will be opening and operating as normal this winter - but it is not yet clear how this will happen.
I'm not sure that Big Sky / Boyne would have a lot of spare cash to step in and buy the YC; although they are doing OK in the medium term thanks to this deal
http://www.saminfo.com/news/article.php?tid=3776
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You need to Login to know who's really who.
You need to Login to know who's really who.
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Anyway, snowHeads is much more fun if you do.
Anyway, snowHeads is much more fun if you do.
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Martin Bell, thanks for clearing that up.
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You'll need to Register first of course.
You'll need to Register first of course.
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When I visited Big Sky a couple of years back (awesome resort BTW), I didn't see a single person skiing the Yellowstone slopes for the duration of my trip. Being a curious kind of guy, I did some quick maths on the place's likely revenue streams, and concluded that it was massively dependent on real-estate development. The trouble with that business model is that once you're built-out or the property market heads south, you can't cover your operating costs and you disappear without a trace. That's no problem for the management - they'll have accumulated some sewrious wealth in the good years - but the the property owners are stuffed. Anyone care for a luxury condo next to a derelict ski-slope?
I don't imagine that the Yellowstone is the only resort with that business model. IMV, we're likely to see a few ghost resorts emerge as a result of this recession - just make sure that you don't own a property in one!
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I think many future ownership scenarios are possible. Before the divorce agreement, there had already been two separate consortiums who had come close to buying the club from TB.
The second-home real estate market will not be in the doldrums for ever - demographics will see to that.
But in the meantime there will be some tough times at YC - I will try to keep everyone updated with what is happening.
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FAQ
