American Skiing Company

Mountain Life
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Mountain Life

Unlike their rivals across the continent at Intrawest in Vancouver, American Skiing Co. officials insist they are a skiing company before all else. "We are first and foremost a skiing operator, and we are second a real estate developer," says Scott Oldakowski, vice president for real estate and marketing at ASC's Bethel, Maine, headquarters. "Your ability to create sticks and bricks has little bearing on the value of your real estate. What drives value is if you're committed to the best possible lifts, the best possible skiing, the best possible service. That's what will create value in real estate."

American Skiing Co. gained a reputation for producing good snow¿and lots of it¿at its six Northeast resorts. Comprehensive base village planning was less of a priority than consistent skiing. This approach has produced a trademark real estate development at American Skiing Co. ski areas: The quarter share hotel. ASC first introduced the wildly popular "interval ownership" quarter shares in 1992 at Sunday River, Maine: A single condominium is sold to four buyers, who each get one-fourth ownership and timeshare-style benefits. Until recently, these condominium hotels, usually called "Grand Summits," comprised the bulk of ASC's real estate product.

American Skiing Co. has sold 1,625 real estate units (mostly quarter shares) at Sunday River since 1983, and another 611 at other resorts. Those numbers are about to take off; as of last November, the company had 4,218 units under development, 1,104 units in sales inventory and a whopping 30,700 units of potential residential development on 7,000 acres spread across its nine resorts in six states (note that a single quarter share counts as a unit). The company racked up $61.8 million in real estate sales in 1998, up from $8.4 million the year before. Those sales accounted for 18 percent of total annual revenues in 1998, versus 4.7 percent in 1997.

Yet to date, American Skiing Co. has built no base villages. That will change. Since it acquired Killington in 1996, and The Canyons, Steamboat and Heavenly in 1997 (paying $294.8 million for the latter pair and a golf course), ASC has decided it needs to be in the village building business. (In December, it announced plans to sell $300 million in high-risk, high-interest bonds to finance village construction, and noted that failure to do so could curtail its development. However, ASC reversed itself in January, deciding instead to privately place $45 million in senior secured notes and $40 million in subordinated notes.)

"A village brings a sense of place¿it brings a kind of magnet, a heart, to the resort," says Greg Spearn, senior vice president for real estate at ASC. "It brings what the market is asking for, which is a place to go, and a place that's free of cars, where you can enjoy the outdoor environment in the mountains."

Spearn was hired away from Intrawest in October 1997, and is convinced that his rrent employer has a different approach to the village concept. "They're very good at what they do," Spearn says of Intrawest, "but I believe they've become fairly formulaic in their villages and apply that formula wherever they go."

Nevertheless, the "alpine villages" ASC is now planning for Sunday River, Killington, Steamboat and The Canyons are likely to feel similar. Each will contain a Grand Summit Hotel or a variation thereon, and each will contain a timeshare project built by Marriott Corporation, which entered into a deal last summer with ASC to build 200-unit hotels at these resorts. Additionally, each alpine village is likely to get what Oldakowski calls a "theme" treatment.

"In building these villages, we've found in going to the skier that one of the things they are looking for is a sort of themed experience," says Oldakowski. "I would draw a parallel to Disney. You have a certain expectation that's been set by Disney when you get to their resort. The experience is always the same, although the experience feels new to you individually."

For more information on ASC, log on to www.mountainvillages.com.

The Canyons, Utah

"It potentially could be larger than Vail," says Oldakowski. "It's almost like looking at Vail 30 years ago and saying, this is a pretty incredible mountain."

With 2,700 skiable acres, The Canyons is already big¿but that terrain represents only half of its skiing potential. The company has spent $32 million in on-mountain improvements, and plans another $30 million¿plus $150 million in real estate development. Two prime real estate opportunities present themselves: 350 acres at the base and 120 acres mid-mountain.

ASC plans two million square feet of development in the master planned base (it controls 150 acres of the 350 involved). This development will be anchored by a Grand Summit Hotel and broken into six neighborhoods. The first project to go on the market, the Sundial Lodge condominium hotel, sold all 150 units in 10 hours last April, for a total of $42.5 million (about $365 per square foot).

Heavy demand for Sundial Lodge is pushing ASC to get other projects to market; two more condominium hotels are likely to be offered this year. "They had a tremendous impact on our market," says Nancy Kelly, an associate at Prudential Coleman Real Estate in Park City. "Rather than buying in Park City or Deer Valley, people were waiting to see what they could get, because they wanted something new and shiny." New development at The Canyons and around Park City's base means buyers may find deals in older property, Kelly says.

The High Mountain Meadows village will be set mid-mountain, at an 8,000-foot plateau. Hidden from Park City and Highway 24, the village will have a more idyllic, less commercial feel than The Canyons' base village, Spearn says.

Currently ASC is working on getting both village sites rezoned by Summit County. Full buildout on The Canyons properties will amount to a projected 2,358 units.

Killington, Vt.

The busiest ski resort in the Northeast and the fifth most popular in the United States, Killington may be New England's sleeping giant. A December 1997 land swap by ASC with the state of Vermont added 1,050 acres to the 400-acre base; this, combined with Killington's three-year plan to connect to nearby Pico with lifts and trails, has positioned the resort to compete with destination resorts in the western U.S. and Canada.

Rated by SKI readers as the No. 1 resort in the Eastern U.S., Killington's problem has been its lack of a "destination" as a destination resort. The company is presently working on a village plan that will incorporate a quiet, pedestrian village green (a nod to New England sensibilities) at one end, and a lively commercial plaza at the other.

Since 1996 the American Skiing Co. has spent $25.6 million in on-mountain improvements and has built a 133-unit Grand Summit Hotel. Most significantly, more than one-third of ASC's entire potential development lies at Killington: an incredible 11,282 residential units. The first phase of development alone anticipates 1,600 units and 1.8 million square feet of commercial construction along the mountain's base.

"What they're trying to do is make it a four-season resort," says Walter Fendeizen, a broker with Martin Associates/ Mountain Real Estate in Killington. "From that standpoint it's a doable thing. The expansion that they've done has generated a considerable amount of excitement and interest in our area from buyers in southern New England and the lower eastern states.

Interestingly enough, we're getting some people who are making the decision about whether to buy at Killington or out in Colorado." One buyer, Fendeizen says, weighed a choice between the Vermont resort and Summit County, Colo.¿and put his money down at Killington.

Read Mountain Property: ASC Snapshots

anyons properties will amount to a projected 2,358 units.

Killington, Vt.

The busiest ski resort in the Northeast and the fifth most popular in the United States, Killington may be New England's sleeping giant. A December 1997 land swap by ASC with the state of Vermont added 1,050 acres to the 400-acre base; this, combined with Killington's three-year plan to connect to nearby Pico with lifts and trails, has positioned the resort to compete with destination resorts in the western U.S. and Canada.

Rated by SKI readers as the No. 1 resort in the Eastern U.S., Killington's problem has been its lack of a "destination" as a destination resort. The company is presently working on a village plan that will incorporate a quiet, pedestrian village green (a nod to New England sensibilities) at one end, and a lively commercial plaza at the other.

Since 1996 the American Skiing Co. has spent $25.6 million in on-mountain improvements and has built a 133-unit Grand Summit Hotel. Most significantly, more than one-third of ASC's entire potential development lies at Killington: an incredible 11,282 residential units. The first phase of development alone anticipates 1,600 units and 1.8 million square feet of commercial construction along the mountain's base.

"What they're trying to do is make it a four-season resort," says Walter Fendeizen, a broker with Martin Associates/ Mountain Real Estate in Killington. "From that standpoint it's a doable thing. The expansion that they've done has generated a considerable amount of excitement and interest in our area from buyers in southern New England and the lower eastern states.

Interestingly enough, we're getting some people who are making the decision about whether to buy at Killington or out in Colorado." One buyer, Fendeizen says, weighed a choice between the Vermont resort and Summit County, Colo.¿and put his money down at Killington.

Read Mountain Property: ASC Snapshots