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Vail and Beaver Creek Market

High-end Home Sales Rebound in Eagle County After Slow Start to 2013

The high end rode to the rescue of Eagle County’s slow real estate recovery in February, with four transactions of more than $5 million contributing $35 million in sales. That’s more than a third of the overall dollar volume of $95.1 million.  One Vail Village sale of $13.5 million accounted for the biggest chunk of that high-end volume in February, which saw a nice rebound in high-end sales after a slow start to 2013 in January. The biggest sale in January was for $2.9 million.  Overall, February was a slightly slower month for sales than January, which trailed January 2012 by 48 percent. There were 83 transactions in Eagle County this February, compared to 97 in January.  But, according to the monthly Land Title Market Analysis (pdf), Eagle County year-to-date in 2013 is only slightly behind the same two-month period in 2012 (180 transactions to 181).

In general, Eagle County appears to still be enjoying a modest recovery from the bursting of the housing bubble that began in late 2008. Last year saw a five-year high in terms of both dollar volume and transactions, but realtors warn that the market is still fragile.  Vail Village remains a top real estate draw, with one transaction in February accounting for $13.5 million of the month’s overall $95.1 million in sales for the month.  “There are so many factors out there that can derail us, and we learned four years ago that, yes, we can be derailed, much to our chagrin,” said Slifer Smith & Frampton’s Led Gardner. “But on the flip side there are a lot of positives out there too, and the high end kind of set the pace for the rest of the valley. “Because if folks are building big homes that means that contractors are employed and painters are employed and that benefits down-valley in Gypsum and Eagle and those types of properties.” While high-end sales were up, lower to mid-range price points still accounted for the majority of sales in February, just as they did in January. And many of those sales on the west end of the county continue to be bank sales and foreclosures, although those transactions were down significantly in February.

Gardner was somewhat philosophical about the market moving forward in 2013.

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Your Guide to Buying a Rural Property in the Rocky Mountains

imagesThe Rocky Mountains offer many pristine, rural properties, ranches and farm houses for sale.  Here are ten pieces of advice to keep in mind before buying:

  1. Is the water supply public or private? If it’s well water, you should have it tested to check for chemicals or other harmful components.
  2. Does the house have adequate septic? When a house is constructed in a rural area, a leach field is built to collect sewage and water waste. Make sure the leach field is the proper size to avoid costly construction bills down the road.
  3. Is the house on a private road? If so, you could be facing thousands of dollars in extra expenses each year, as you’ll be forced to split the bill with your fellow residents for plowing, maintenance and paving.
  4. Has the area ever experienced a major power outage? If so, how long was the power out?
  5. How is the air quality? Ask about radon levels and smog levels from any nearby manufacturing plants.
  6. What is the average snowfall? How does the town handle major snowstorms?
  7. Where are the boundary lines? Make sure the property divisions are clear and established.
  8. Who handles trash pickup? Is there a nearby dumping ground?
  9. Are there any deed and zoning restrictions?
  10. How difficult is it to maintain the property?

Colorado Revenue Continues to Grow, Economists Say

imagesColorado’s economy continues to outperform expectations, spurred on by tax revenue from stock sales, although unemployment remains high, state economists told lawmakers Monday.  The state’s tax receipts are expected to be $548.2 million, or 7.1 percent higher, this budget year than the prior year, according to Gov. John Hickenlooper’s economists. The latest quarterly forecast from state economists touched on familiar trends of past reports: Colorado’s economy is outperforming the national economy, but there remains caution because of the revenue growth is driven by taxes on one-time stock sales.  “We have clue after clue that what we’re dealing with is volatile revenue stream,” said Henry Sobanet, Hickenlooper’s budget director.  With the adjusted revenue numbers from December, the state’s general fund is expected to be $8.3 billion for the fiscal year that began in July. The general fund now exceeds the pre-Great Recession peak of $7.7 billion in 2007. The quarterly forecast released Monday afternoon will play a key role in the upcoming debate over the budget, especially as lawmakers debate an overhaul of the state’s system to fund schools. Lawmakers typically give final approval to the budget next month.  State legislative economists also delivered a separate forecast to lawmakers Monday with a similar outlook of cautious optimism for the state.  “I believe it is the spring of this recovery. However, know that storms can still happen in the spring,” said Natalie Mullis, the Legislature’s chief economist.

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Vail Resorts CEO Rob Katz: ‘We Are Very Pleased’

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This is a great article from the Vail Daily about Vail Resort’s 2013 Fiscal Year.

Vail Resorts officials Friday reported strong results for the company’s 2013 fiscal year, with gains in everything from pass sales to ski school revenue.

In a Friday call, company CEO Rob Katz said he’s “proud of our accomplishments” for the fiscal year — from Aug. 1, 2012, to July 31 of this year — saying the numbers reflect “… higher overall visitation, improved pricing, increased average guest spend and strong pass sales.” The company’s stock finished the day at $69.59, up 61 cents from the previous day’s closing price.

Katz gave call participants an upbeat look at the company’s performance. Season pass revenue increased 8.8 percent from the previous fiscal year driven, in part, by the company’s management deal for The Canyons resort in Park City, Utah.

Katz added that the company’s acquisitions of small, Midwest ski areas — Afton Alps in Minnesota and Mount Brighton in Michigan — have also helped spur season pass and lift ticket sales. Pass sales in the past fiscal year also include a new pass for Keystone and Arapahoe Basin, as well as the addition of resorts in Austria and France to the traditional Epic Pass. Those additions mean the company is growing in both the “high end” and “value” markets, Katz said.

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2012-13 Skier Visits Creep Up by 4 Percent in Colorado

Arapahoe Basin Ski AreaColorado’s ski areas hosted 11.4 million skier visits last season, a nearly 4 percent increase over the previous season’s 11 million.

The 11.4 million mark, while an increase over the dismal and dry 2011-12 season, is the third-slowest season in the past decade, and the annual increase falls well below the national spike of 11 percent.

Colorado Ski Country USA, the trade group that represents 21 of the state’s 25 ski areas, reported 6.4 million skier visits in 2012-13, an increase of 3.8 percent, or 235,000 skier visits, over 2011-12. Vail Resorts’ four Colorado ski areas — Vail, Breckenridge, Keystone and Beaver Creek — saw about 5 million skier visits.

Colorado’s 2012-13 season started slowly, with weak snow and local skiers staying home. Storms in late December and late spring fueled a rebound in visitation. But it wasn’t enough to pull the state closer to the 12 million-skier-visit benchmark it reached in 2006, 2007, 2008 and 2011.

Declining skier visits does not necessarily correlate to decreasing revenues, as evidenced by ski areas that saw increased revenues in 2011-12, which saw record declines in visitation.

Vail Resorts Management Discusses Q3 2013 Results

imagesSkier visits at our Colorado resorts for the quarter were up 11.8% over the prior year, offset in part by a decline in skier visits of 0.4% at Heavenly and Northstar, where unusually warm and dry temperatures this spring negatively impacted results.

For the 3 months ended April 30, 2013, excluding the Acquisitions, lift revenue excluding season pass revenue was up 13.4%, compared with the same period in the prior year. We also saw continued growth in ancillary revenue, driven by increased guest spend, with dining revenue up 13.9%, ski school revenue up 11.8% and retail/rental revenue up 7.4%, excluding the Acquisitions.

Retail/rental results were modestly tempered by results in our city store locations. Mountain Reported EBITDA, excluding the Acquisitions, increased $19.2 million or 11.2% for the quarter, compared to the same period in the prior year. Our lodging segment benefited from increased visitation, especially during peak holiday periods, with total occupancy increasing by 2.3 percentage points, along with rate increases as Average Daily Rate, ADR, increased 2.9% at our owned hotels and managed condominiums.

As a result of improved operating efficiency, we increased lodging EBITDA margins by 2.9 percentage points, contributing to a 22.1% increase in Lodging Reported EBITDA, as compared to the same period in the prior year.

Our Real Estate segment continues to see increased demand and we are encouraged by the level of interest and rate of sales we are seeing at both of our development projects.

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Mountain Real Estate Markets Gain More Stability

Real estate sales continue to improve in Park City and Vail. The market has improved dramatically in the last three years.

In Park City, property sales were up four per cent during summer and median property prices rose 11 per cent from the year before.

“It’s a slow but steady improvement,” said Mark Seltenrich, the statistician from the Park City Board of Realtors. “The biggest trend is that the really cheap properties, the low-priced condos or low-priced lots, are not there anymore.”

Curt Singleton, executive director, told The Park Record the rebounding market is reflected in the expanding roster of sales agents affiliated with his organization. “More people are getting back into real estate.”

From Vail comes much the same story, with the bottom-end foreclosures being cleared out in the down-valley markets at Eagle and Gypsum. Several agents told Mountain Town News that they have had multiple offers on properties, the first time in some years for that to happen.

The Most Expensive Place To Build Your Dream Ski Chalet

Aspen, Colo. is the most expensive place in North America to build a ski home, according to a recent study by high-end home design company Pollack + Partners.

If you’re planning to build in Aspen, expect construction costs (materials) to average $950 per square foot and the project cost (materials + labor) to be $1,235 per square foot.

“Aspen is at the top of the list perennially because it is the most exclusive ski resort out west,” Chris Pollack, president of Pollack + Partners, told Business Insider. “And that factor lets it demand the highest prices for construction costs. Everyone wants to be there.”

Big Sky, MT came in second on the list, at $900 per square foot for construction and $1,170 per square foot for the total project.

Click here to read the rest of the article, and see how other ski towns rank. 

More Golf Courses Than Golfers at Vail

Is the Vail resort complex oversupplied with golf courses? You could make that argument, as several of the valley’s 17 public and private clubs have struggled enormously in the wake of the Great Recession.

But don’t paint with too broad a brush, warn several resort leaders in the Vail Valley.

“They’re not all the same,” said Johannes Faessler, owner of the Sonnenalp Resort of Vail and a companion golf club downvalley at Edwards. “There are different reasons why things happen to different clubs,” he told the Vail Daily’s Lauren Glendenning.

Even in the 1980s, a columnist for a now-defunct newspaper in Vail joked that someday it would be possible to golf continuously from Vail to Glenwood Canyon, a distance of nearly 80 kilometres.

During the 1990s and early 2000s, developers seemed determined to make that come true. There was even a proposal to build a golf course atop an abandoned landfill. At another location, a developer proposed to cap an old pile of mine tailings and create a golf course, as was done at Anaconda, Mont.

Then golfing, as had happened with tennis in the 1970s and skiing in the 1980s, started losing its luster. The growth flattened, nationally as well as at mountain resorts.

Those golf courses that suffered most substantially in the Vail area were those farthest from the ski slopes and resort centers of Vail and Beaver Creek. Brightwater, a project located south of Gypsum, about 72 kilometres from Vail, is now in bankruptcy. A beautiful course called Adam’s Rib, south of Eagle, reportedly sold very few memberships and has revised its fees.

Then came news that only one of four courses at Cordillera, a resort about 16 kilometres from Beaver Creek, would remain open. There are countersuits between the owner of the golf courses, David Wilhelm, and club members, who own property adjacent to the courses.

“Don’t let the Cordillera fiasco overshadow the fact that each one of these courses is doing better,” said Harry Frampton, managing partner of East West Partners. The Avon-based company most typically has built golf course-based higher-end real estate.

Frampton, an avid golfer, says there’s no better place to play golf in the United States than the Vail area. But there are two problems. First, the season lasts only three or four months. And second, he thinks too many of the golf courses are too hard for the average golfer, taking four to five hours to play, too much commitment when there are dozens of other things to do.

He also told the Vail Daily that in a survey of his company’s high-end real estate buyers, 20 per cent had been driven by golf. It’s still important, he said, but golf does not drive the economy of the Vail Valley.

What does during summer? Unlike winter, there is no dominant driver. The Vail Daily sites research done for the Vail municipal government that showed hiking was the top activity of summer visitors.

The percentage of summer visitors who had or planned to golf while in Vail had declined from 32 per cent in 2005 to less than 12 per cent in 2012.

Vail Valley Real Estate Set For Good Year

Forget the “fiscal cliff” showdown between the president and Congress. Jim Flaum has already seen such a cliff and lived to tell the tale.

Flaum, president and managing broker of Slifer Smith & Frampton Real Estate, and everyone else in Eagle County went over a fiscal cliff between 2008 and 2009. In those years, real estate sales volume dropped 60 percent, with total sales going from $2.2 billion to $898 million in those years.

Since that low point, the valley’s real estate market has climbed, unevenly, back above the $1 billion mark. Sales bounced back to nearly $1.5 billion in 2010, then fell back to $1.1 billion last year.

This year, there’s been a steady climb from last year’s numbers, in both transactions and sales volume. In fact, only March’s numbers were behind those recorded in 2011.

According to the latest report from Land Title Guarantee Company, transactions and dollar volume for October were both significantly higher than last year. Transactions jumped by 68 percent, and dollar volume increased by 42 percent.

There were 218 transactions in October, the first time the county had surpassed the 200-transaction mark since September of 2007. That year — which seems like a long, long time ago — monthly sales averaged 224 transactions per month for the entire year.

We’re still a long way from 2007. But we’re also a long way from 2009, the very bottom of the local real estate market.

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