My Page: Jonathan Weber

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Copper Mountain resort, a major ski hill about 75 miles west of Denver, is being sold by troubled ski giant Intrawest to Park City-based Powdr Corp., the owner resorts in Utah, California, Vermont, Oregon and Nevada. The deal is expected to close in December, and both companies say patrons should see few changes in the short term. The terms of the deal were not disclosed.

Vancouver-based Intrawest said the sale was part of its strategy to focus on “core resorts,” though it did not elaborate on what was considered core. The comapny’s flagship is Whistler-Blackcomb, which will host alpine skiing at this winter’s Olympic Games.

Intrawest, which was acquired by New York-based Fortress Investment Group in 2006, has been hit very hard by the mountain real estate meltdown and is struggling to manage a large debt load. The Toronto Globe & Mail has a good story today on Intrawest’s travails and its recent financial history.

Boom and Bust

Like the residential real estate bubble, the commercial real estate boom of 2003-2007 was fed by cheap money and lax lending standards. Institutional investors such as hedge funds and insurance companies - strangely blind to the possibility that real estate values could decline - had an insatiable appetite for any loan that had a decent interest rate and was backed by real estate. When the rosy projections on cash-flow for apartment complexes, office buildings, shopping malls and resort hotels were revealed to be pipe-dreams when the market turned, the carnage began - and it’s likely to continue for a while, according to a recent report from the Urban Land Institute and PricewaterhouseCoopers.

Truck Crash Fallout

At a public meeting following the October crash of a tractor-trailer along the east shore of Flathead Lake, Montana Department of Transportation Director Jim Lynch told the audience a community effort to increase safe driving along Highway 35 would ultimately be more effective than attempts to restrict truck traffic along the roadway.

The forum, held at the Best Western Grand Oak Hotel, was a chance for public dialogue after a truck carrying wood chips veered off the road near Finley Point Oct. 20, crashing and injuring the driver. This most recent crash stoked the concerns of east shore residents, occurring about a year-and-a-half after a truck crash in nearly the same spot dumped 6,400 gallons of gasoline, forcing five families out of their homes and costing millions to clean up.

Two other trucks have crashed in the area over the last several years, each time underscoring the complaints of many east shore residents that MT 35 is simply too narrow, residential and close to Flathead Lake to allow such heavy freight. The trucking industry, however, has long argued that the east shore route from Polson to the cities of the Flathead is shorter and flatter than taking U.S. Highway 93 along the west shore, saving fuel and time. 

Justice and the Flathead Boat Crash

The prosecution of Montana State Sen. Greg Barkus for an alleged drunken-boating accident on Flathead Lake that left five people seriously injured is not exactly off to a smooth start. First, it took an inordinately long time for police to release key evidence - namely Barkus’s blood alcohol level - and bring charges in the case, which involved a high-speed crash into the shoreline and counted U.S. Rep. Denny Rehberg among the injured.

Then all three District Judges in Flathead County recused themselves from the case on the grounds that they had worked with Barkus on legislation. A Judge from Livingston was moved aside at the request of prosecutors, and a Judge from Lake County is now being replaced at the request of the defense. Barkus has pleaded not guilty, and his attorney says he’ll challenge the blood-alcohol test, which prosectors say showed Barkus to be at twice the legal limit.

It’s easy to see why judges would view the case as the worst kind of lose-lose proposition. Come down hard on Barkus, and his influential friends (who might be your friends too) will hate you for it. Go easy, and your neighbors (and the voters) will hate you for it. 

Luxury Resorts

It’s no secret that the luxury second-home market in the Mountain West has taken a huge hit since the national housing market went south, and the Wall Street Journal today does a nice job of detailing the carnage at the highest of the high-end hot-spots. A 10,000 square foot house in the prestigious Starwood area of Aspen (6 acres, barn and guest house) is now listed at $9.95 millioin, down from $15.9 million - and it hasn’t sold yet. Sun Valley, Jackson Hole and Park City are all seeing dramatic declines in sale prices and transaction volume.

While there are some signals that the high-end resort market isn’t totally dead - Sam Byrne, the new owner of the Yellowstone Club in Montana, reported surprisingly strong sales activity when he spoke at NewWest.Net’s recent conference - the frenzied building of the 1990s and 2000s has left plenty of inventory of multi-million-dollar mountain homes that will undoubtedly take a while to absorb - even in Aspen.

Elizabeth Clare Prophet

When I first came to Montana in 1982, I got a job waiting tables at Chico Hot Springs, and the hot issue of the moment in Paradise Valley was the Church Universal and Triumphant.  The cult-like religious sect had just purchased Malcolm Forbes’ spectacular ranch in Corwin Springs, and the locals feared that a big influx of church members would lead to a literal takeover of Park County.

It didn’t happen that way, though the Church achieved more than a little notoriety later in the decade when it stockpiled weapons and built a huge bomb shelter just north of Yellowstone Park. The end of the world is nigh, said the group’s charismatic leader, Elizabeth Clare Prophet. When the apocalypse didn’t happen on the appointed date in 1990, the church began to fade.

Prophet was later diagnosed with Alzheimer’s Disease, and lived her last years in seclusion in Bozeman. She died on Thursday, and the Bozeman Daily Chronicle has a good story on this strange chapter in the history of Southwest Montana.

Sports and Education

University of Montana football coach Bobby Hauck is no fan of the press, or at least not press that actually does its job by asking questions. But whether or not that’s an appropriate attitude for the leader of the highest-profile sports team in the state, his recent behavior towards the UM student newspaper, the Montana Kaimin, is downright embarrassing. If he can’t grow up, he needs to find a new job.

OCt. 12-13 in Missoula

NewWest.Net’s Real Estate and Development in the Northern Rockies conference kicks off on Monday, and if you haven’t signed up yet there are still some options.

On Monday, the two Missoula tours are sold out, but we still have some room left for the Butte historic preservation and redevelopment tour, which promises to be fascinating. (You’ll need to sign up in advance for that one as it leaves at 8:00 a.m. Monday.) On Monday afternoon at 4:30 we formally kick off at the MCT Theatre with economist Christopher Thornberg, who has become something of a cult figure among folks who have seen his dead-on accurate real estate market forecasts at our previous conferences. His talk will be followed by a reception, sponsored by First Security Bank. We have a limited number of $39 tickets for Thornberg’s presentation and the reception only; on-site tickets will be available, space permitting.

Tuesday is a full day at the Hilton Garden Inn, with three tracks of break-out sessions in the morning and a plenary session in the afternoon. The afternoon features Luther Propst of the Sonoran Institute, Roger Lang of Sun Ranch, Michelle Sulllivan of Sullivan & Assoc., architect Andy Erstad, and developers Mark Wolley and Keith Simon, among others, and will conclude with Sam Byrne, the new owner of the Yellowstone Club. The Tuesday evening reception will feature music with Shane Clouse and Tom Catmull, sponsored by WGM Group. Tuesday-only ticket are available for $198, and include breakfast, lunch, breaks, and the reception (as well as all the great presentations, of course). You can sign up online or on-site at the Hilton.

We hope to see you at the event, please call 406-829-1725 if you have questions, or visit the conference website at www.newwest.net/realestate.

4th Annual Real Estate and Development in the Northern Rockies

Since we launched our regional conference series four years ago, we’ve taken pride in providing carefully crafted programs of top-notch speakers, with high production values all the way around. And one result is that we have been able to qualify our conferences for continuing education credit in multiple disciplines.

Oftentimes, professionals regard continuing education as a burden, and the traditional providers of continuing education often respond with courses that are designed to satisfy the requirement, nothing more and nothing less. But at NewWest.Net’s Real Estate and development in the Northern Rockies conference - the fourth annual edition takes place next week, Oct. 12-13 in Missoula - you can get your credits, and have a fantastic and broadly educational experience too.

Architects, planners, Montana appraisers, Montana lawyers and Montana and Idaho real estate agents can all get credit at Real Estate and Development in the Northern Rockies. We know you won’t be disappointed - we consistently receive overwhelmingly positive responses from attendees on the quality of our programs. We hope you can join us. Visit NewWest.Net/realestate or call 406-829-1725 for more details.

Tickets Now Available

Christopher Thornberg of Beacon Economics in Los Angeles is one of the few economists to have predicted the housing bust, and we’re delighted to have him once again as a keynote speaker for NewWest.Net’s Real Estate and Development in the Northern Rockies conference, Oct. 12-13 in Missoula.

Chris is a fantastic presenter, and this year he’ll be opening the conference at 4:30 p.m. on Monday, Oct. 12, with a special session at the MCT Center for the Performing Arts in downtown Missoula. We have a limited number of tickets available for Chris’s talk and the opening reception only: these are priced at $39. (Visit www.NewWest.Net/realestate or call 406-829-1725 to register).

I chatted with Chris this morning about his current assessment of the national real estate market and the economy as a whole.

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