After five-day hearing, commission to decide what Vail owes Vail Resorts for parcel
The five-day valuation hearing wraps up at the Eagle County District Court
Chris Dillmann/Vail Daily
EAGLE — After hearing five days worth of evidence and testimony from both the town of Vail and Vail Resorts, it is now up to a three-person commission to determine what a fair price is for the town to pay for the Vail-Resorts-owned site in East Vail.
The valuation hearing concluded its fifth and final day on Wednesday, Sept. 13, with Vail Resorts resting its case and both parties presenting their closing arguments to the commission.
As the hearing concluded, the commission was left to deliberate on the amount owed. There is no deadline for the decision to be made.
At the center of these condemnation proceedings is the 23-acre parcel itself, which is owned by Vail Resorts and located in East Vail. The parcel is split into two pieces: a 5.4-acre piece that is zoned for housing and a 17.9-acre piece that is zoned for Natural Area Preservation.
The parcel is currently entitled for 61 units of housing, 30 of which are apartments and 19 that are townhomes. This includes 49 deed-restricted employee-housing units as well as 12 free-market townhomes.
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However, the town — in seeking to condemn the parcel — intends to preserve the site as open space for the area’s bighorn sheep herd. The town of Vail was granted immediate possession of the site earlier this year following a May eminent domain hearing but must pay a fair market price — determined by the commission — before it takes ownership.
Throughout the hearing, the two entities each presented their opinion of what “just compensation” was owed to Vail Resorts by the town to obtain this parcel. Vail Resorts argued its value is just north of $23 million, while the town argued its value is between $11.1 million and $12.9 million.
In its closing argument, the corporation argued that this amount — which values the approximately 5-acre housing parcel at $95 per square foot, and the remaining Natural Area Preservation acreage at around $1 per square — was the “just compensation owed.”
“Put simply, the question is, what is it worth?” asked Jack Sperber, representing Vail Resorts, in its closing argument. “What is it worth to have the right to immediately begin development of a critically needed workforce housing project? How much would somebody pay for that opportunity?”
The town contracted two separate appraisers. The first valued the parcel at $12.93 million — which applies a $55 per square foot value to the 5-acre site and no additional value for the remaining acreage. The second valued it at $11,081,000 — which applies a $39.50 per square foot value to the 5 acres and approximately $2.30 per square foot for the remaining natural area preservation acreage.
“Those having been done independently should give some reinforcement to the validity of that two separate appraisers looking at different data and arriving at relatively close total figures of compensation,” argued Patrick Wilson, representing the town.
However, Sperber suggested: “Two wrongs don’t make a right.”
While both entities relied on appraisal experts to determine these values — each using a comparable sales analysis to determine their ultimate number — there was still a significant difference in the final opinion of value.
Using this approach, each appraiser selected several local real estate sales they determined were comparable to the East Vail site based on what they saw as the site’s “highest and best use.” All appraisers agreed that this use was for development as zoned for workforce housing.
However, where they differ is in the adjustments each made for attributes such as market conditions, location, entitlements, zoning, topography and more between the comparable properties and the Booth Heights parcel. The adjustments are made in an attempt to equalize these variables.
The primary disputes in the case — as summarized in both parties’ closing arguments — were the different adjustments made for market conditions, location and the topography of the site (including what it would take to make the site “development ready”) as well as the impact of workforce housing on value, how the 17-acre Natural Area Preservation site should be valued, and on the usefulness and accuracy of engineering and cost estimates on getting the site ready for development.
Wilson argued that Vail Resorts’ number was based on “excessive” and “inappropriate” adjustments for location and market conditions as well as “dramatically underestimated” costs associated with what it would take to develop the property.
Sperber argued that its appraisal represented the most reasonable value and that the town’s appraisals were “inconsistent” and “can’t be reconciled in any meaningful way.”
Both argued that these adjustments “distorted” the data in different ways.
Once the commission signs a verdict with the compensation owed, the Town Council will ultimately vote on its willingness to pay whatever that amount is.
Currently, according to Kris Widlak, the town’s director of communications, the Town Council is scheduled to make this decision at its Tuesday, Oct. 3, meeting.
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The town has already provided a deposit of $12 million in accordance with Eagle County District Court Judge Paul Dunkelman’s June 30, 2023 order, which granted the town immediate possession.
This week, the town also presented to the Eagle County Open Space Advisory Committee, seeking its assistance in purchasing the 23-acre parcel. While the county commissioners will make the ultimate decision, the committee recommended a contribution of $5 million.