Yellowstone Club files for bankruptcy

Good! Skiiing should be for everyone, not just the uber rich. Sucks for those who bought into though.
 
rfarren":3ckfi0x5 said:
Good! Skiiing should be for everyone, not just the uber rich.
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Don't go holding your breath for that to happen anytime soon. While the article isn't specific, I'm certain that it's just a reorg.
 
As some of you know, I had a ski day there in 2001 in conjunction with the NASJA annual meeting at Big Sky. http://bestsnow.net/yclbguid.htm As presented then, Yellowstone Club was not likely to have a problem growing slowly with new members, and then being self-sustaining.

As with many of these entrepreneur types, Tim Blixseth didn't stick with his original plan and decided to start buying these other properties all over the world. This presumably entailed taking on more debt, which we all know is a risky idea in the the ski business. Then the LeMond lawsuit and particularly the messy divorce, and here we are today. Ironic, because one of the reasons for the slow growth was the "strong family orientation" (resulting in careful screening of prospective members) the Blixseths wanted when they founded Yellowstone Club.
 
rfarren":2xgahrl0 said:
Good! Skiiing should be for everyone, not just the uber rich. Sucks for those who bought into though.
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So you won't mind if I come to stay at your place for awhile. After all, what you're basically suggesting is that property owners and business owners should have no say in how they want to operated their business or what they should be allowed to do with their property. Therefore you won't mind if I stop by and tell you how to run your life. If you're a business owner then you won't mind me telling you what you should price your product or service at. If you're just an employee then you won't mind if I adjust your salary to what I think you should be making.

You can apply your same logic to any ski area. Skiing should not cost anything should it? It should be free or super cheap for all. Why not attack Mammoth Mountain for charging $85 a day? What about Mountain High for $50? What about Vail for $95? Maybe all ski resorts should be forced to charge the same irregardless of their facilities, size or what they offer.

Yellowstone Club has a right to operate their business as they see fit - including running it into the ground. Don't start in with the public property baloney either. The government makes money by leasing public land which the public benefits from. I see no difference between the Yellowstone Club and any other ski area that leases public land. They all charge a price and they all should have the right to decide what that price should be. You might as well go bash Deer Valley and tell them they have no right to set a limit on the number of skiers that may access the mountain on a given day.

Equality makes the world boring and class envy is a disease. If you're unhappy about your situation then do something about it and stop telling others how they should run their lives.
 
egieszl":3it1n2ug said:
rfarren":3it1n2ug said:
Good! Skiiing should be for everyone, not just the uber rich. Sucks for those who bought into though.
Click to expand...

So you won't mind if I come to stay at your place for awhile. After all, what you're basically suggesting is that property owners and business owners should have no say in how they want to operated their business or what they should be allowed to do with their property. Therefore you won't mind if I stop by and tell you how to run your life. If you're a business owner then you won't mind me telling you what you should price your product or service at. If you're just an employee then you won't mind if I adjust your salary to what I think you should be making.

You can apply your same logic to any ski area. Skiing should not cost anything should it? It should be free or super cheap for all. Why not attack Mammoth Mountain for charging $85 a day? What about Mountain High for $50? What about Vail for $95? Maybe all ski resorts should be forced to charge the same irregardless of their facilities, size or what they offer.

Yellowstone Club has a right to operate their business as they see fit - including running it into the ground. Don't start in with the public property baloney either. The government makes money by leasing public land which the public benefits from. I see no difference between the Yellowstone Club and any other ski area that leases public land. They all charge a price and they all should have the right to decide what that price should be. You might as well go bash Deer Valley and tell them they have no right to set a limit on the number of skiers that may access the mountain on a given day.

Equality makes the world boring and class envy is a disease. If you're unhappy about your situation then do something about it and stop telling others how they should run their lives.
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The way I see it the free market dictates prices for ski areas. People will pay what they will to ski. In this case, the free market killed this project, in large part due to the exclusive nature of the project. I could care less about the federal land scenario you laid forth unless they aren't allowing someone to join because of race, religion, or sexual preference. In that case, it would be illegal being as it federal laws must be followed to keep a lease of federal land.

Alta has skier limits, and so does Deer Valley and I have no problem with either. However, the skier limits are based on what time you get there, not whether you make 3 million a year. Personally, I prefer Alta's egalitarian attitude about skiing better. It is one of the cheapest resorts out there, but is often ranked at the top by true skiers. Being as the quality of the ski experience is so high, and the price is pretty reasonable, considering the massive cost of skiing in the first place, I think Alta is a much better ambassador to the sport than Deer Valley. However, lunch at deer valley is pretty nice, and the amenities are top notch, and certainly there is a sector of the ski market that likes that and can afford that.

My only point is: you don't need to argue with me that I'm so neo-communist hippy. It's not true. However, if you want to have a rich get away where snobs ski together and hug each other about how rich they are on lift thats fine by me. Just know, I have a right to laugh at you at the stupidity of it all, and will be laughing even harder when you fall.

One more thing: The best skiing sometimes doesn't cost anything to do it. Ask any hardcore skier who goes back-country for a untracked turns 3 days after a storm.
 
A bit of background on the Yellowstone Club property. Blixseth made his $$$ in timber. The land he owned was in a checkerboard pattern covering a broad area between Big Sky and Yellowstone National Park. Blixseth traded the parcels adjacent to Yellowstone National Park, expanding its non-developable ecosystem, in order to get the ~14,000 acres south of Big Sky as one contiguous property. So Yellowstone Club is completely on private land. The model Blixseth was developing was a first in skiing but is quite common in golf. The marketing person he brought in, Charlie Callendar, surprised me on the 2001 visit as he was in the class behind me in high school and had previously been successful developing a Palm-Springs area country club.

I believe this will remain a rare model in skiing vs. golf. With water and infrastructure you can build a golf course almost anywhere. The number of mountain locations with appropriate terrain and snow for a viable ski resorts is very limited, and in the West the vast majority are on Forest Service land. I also see the ski culture as very different from golf culture in terms of demand for private vs. public facilities.

So no matter how successful Yellowstone Club ever becomes, I don't see it proliferating as a model in the ski industry. Even though its marketing slogan is "Private Powder," you could buy a whole lot of heli time for far less than a membership at Yellowstone Club.
 
Long-term, I suspect that the private country club model for Yellowstone Club might not work. I do not know its finances, but it's highly likely the real estate development arm underwrites the skiing operation. And while there might be some more vacant lots to fill in, the real estate play is larger over for a period.

Eventually, there will be a desire to hold down maintenance/operation costs.

Therefore, I think in 5-10 yrs that some arrangement will be worked out with Big Sky. Presently, Big Sky is an operating entity. It sold off its land. It operates certain chairlifts that real estate developers paid for. There is little reason why it should not simply operate Yellowstone Club skiing facilities.

From a geographic/logistics point of view, if you could restrict skiers to only ski lift/lodge only access. Given poor access, it would be difficult for crowds to ever materialize at any Yellowstone lift. Also Big Sky only gets 350k skier/year or so. Less than Jackson, Telluride, Snowbird....not to mention Vail, Park City, etc. Lines will never be a factor.

One could look at Arrowhead, CO @ Beaver Creek as an example. It was started as a similar pursuit -> private skiing for homeowners (not as extensive as Yellowstone for sure). However, it eventually sold itself to Beaver Creek/Vail during a poor real estate climate.
 
I wonder what the operating cost of for a ski mountain like Yellowstone club is vs. a private golf club.
 
In 2001 the Blixseths owned all 14,000 acres. Real estate and membership sales ($250K) were supposed to endow a maintenance fund, plus annual fees of $16K per member. They gave us some of the numbers then, and it seemed to pencil out at the time. It was a fairly obvious question for us journalists, 10-20 skiers/day on a mountain that size with 3 high speed lifts. Jon Reveal, in charge of mountain ops, thought he had an ample budget.

I suspect the main problem was the ill-fated decision to go in to debt to expand into other vacation properties. Then the divorce would have divided the assets.
 
More news:

http://www.billingsgazette.net/articles ... 6-club.txt

Members of the Yellowstone Club for the ultrarich are opposing another loan to the financially-troubled Montana resort and demanding to know what happened to $463 million in club dues and past loans.

The revolt against the exclusive club's management - by a group claiming to represent more than 100 of its 340 members - comes amid proceedings in the club's bankruptcy case.

....

"Today, that money seems to be gone and the members want to know why," attorneys for the Ad Hoc Committee members wrote in court filings.

They added that it "appears that a large portion of the $375 million loan ... was diverted for non-Yellowstone Club purposes. Had the funds been properly used, it is likely that the Debtors (the club) would not find themselves in the position they do today."
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The loan was approved, however. More at the link. (stolen from TGR)
 
I don't think the Yellowstone Club is a failed concept. The truth seems to point to misuse of the clubs funds to invest in other projects, but it appears that had the funds not been used in this manner the Yellowstone Club would not be in this position.

I highly doubt that Big Sky will take over the operations unless it is just purely an operational contract with the property owners and I expect the "private" nature of this mountain will prevail.

Thank you to whomever pointing out the fact that the Yellowstone Club operates on private land. As a business owner myself I don't want others telling me how I should run my business. If there is a need, then there will likely be someone who will identify that and fulfill that need and there certainly is an opportunity to provide services to millionaires. They too deserve to reap the benefit of their hard work. There is nothing wrong with being successful and amassing wealth.

Finally, I am well aware of what earning your turns means and that the best skiing in the world is not lift served. As for Alta, you all can have that overrated place. Alta has an inflated ego and I've never been impressed. I'll stick to Aspen-Snowmass and Mammoth Mountain as my preferred places to make turns. If my future travels happen to take me to Utah then I'd rather ski Snowbird, Park City, Snowbasin or Solitude over Alta.
 
From the same Billings Gazette article:
In court filings, the Ad Hoc Committee of Yellowstone Club Members claimed the $250,000 deposit required for each membership had contributed approximately $88 million since the club was founded.

That’s on top of a $375 million loan taken out in 2005, when the resort was under the control of Blixseth’s former husband, Tim Blixseth. He used at least some of that money to buy overseas properties in a failed attempt to take the club concept international. Approximately $307 million of that loan remains unpaid.
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Confirms my conjecture of why this happened.

FYI the $250,000 memberships are supposed to be resaleable, as I recall from the 2001 trip. New members would still have to be approved by the board, and the market price of memberships is likely depressed under the current circumstances. Also I recall the projected total membership was something like 580, so Yellowstone Club is not yet full by its original plan.
 
Viability varies....(or YMMV).

Never met him, but have not heard particularly good things about Tim Blixseth. That said, there are private clubs out there and other proposed BIG, very private ski areas (Ginn is planning a big private resort on land just S & W of Vail for example http://www.minturn.org/battleMtn/maps.html ).

Other smaller examples would be Holimont back east - though much less restrictive as public can ski there on weekdays. I have not heard recent info on the Big Tupper revival in the ADK's - that was supposed to be private as well. Etc.., etc...

There are multiple niches within in the luxury segment and each proposal/area has to find it's place to survive. Windham used to be private, Arrowhead used to be as well, etc... so YMMV. It's a tough segment to keep happy even with (or especially because of) all the money involved.
 
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