Economy slows Vail ‘renaissance’
VAIL ” One project, the Roost Lodge redevelopment, is on hold for at least a year until more sales commitments are made.
Another planned condo project, the Cascade Residences, has been trying to make enough sales for it to move forward.
This comes after a former Vail councilman warned earlier this year that projects would stall in this time of economic uncertainty.
Will Vail see more and more of its planned “renaissance” ” driven by real-estate sales ” falter as demand for second homes dries up?
Jerry Jones, a veteran ski industry analyst, said buyers are apprehensive during this economic downturn. But he was optimistic that the slower times would be short-lived.
“These projects, in a slowdown, if they can have some staying power, it won’t be a problem,” he said.
Vail ” with its proximity to Denver and its great terrain ” has proven over the years that it’s a solid investment, Jones said.
“This is just a typical cycle,” Jones said. “This has happened in my career maybe six times over the last 30 years. You go up and down and up and down, but it never goes down below what it started out as.”
Kevin Deighan, a member of the development team for the Roost Lodge, said the planned construction of a condo-Marriott Hotel project probably will be delayed until next spring due to lack of sales.
Pat Mitchell of Forbes Sotheby’s International Realty said the Cascade Residences is wrapping up its last needed sale and has a “50-50” chance of starting construction this year.
Rob Katz, CEO of Vail Resorts, said in March that the Ritz-Carlton, which the company is building in Lionshead, has not seen any sales since late last summer.
While the Ritz construction “absolutely” would not stall because of a down market, Vail Resorts has pushed back its timeline for selling Ever Vail, the planned $1 billion ski village, to the winter of 2009-2010, Katz said in an interview Friday. Part of the reason was the slowed market, he said.
“I think that the market was very, very robust over the last couple of years,” Katz said. “I think that in the market right now, buyers are much more discerning.”
Katz said the buyers of Vail Resorts’ luxury real estate are “somewhat” insulated from the country’s economic downturn, and that within a year or two, he expects the local real-estate market to rebound.
“The market is still progressing,” Katz said. “Buyers are taking their time and being picky, but plenty of people are still buying real estate.”
Sales data show fewer homes are being sold, but each is selling at a higher price.
The number of sales in the county through March is down 42 percent compared to last year, while the average sales price is up 40 percent to an average of $1.47 million, according to data compiled by Land Title Guarantee Company in Eagle.
Mark Gordon, a Vail town councilman, said a delayed project shows a developer is being responsible.
“I’d much rather see a developer be smart and responsible and wait until the time is right than try to force something that’s not going to work,” Gordon said.
Still, redevelopment lets Vail stay competitive as a vacation destination, he said.
“We have to remain competitive in the tourism industry by reinventing ourselves and creating the trends and being at the forefront of the tourism business,” he said.
Vail has seen more than $1 billion in construction over the last five years, with almost $2 billion still planned. Leaders tout the building spurt as a “renaissance” that will give the aging ski town a much-needed facelift.
But ex-Councilman Kent Logan warned the town in March to be more cautious with its money, as the economic downturn could cause developments to stall and buyers to disappear.
“In football parlance, there’s a time to play offense and there’s a time to play defense,” Logan said then. “This is a time to play defense.”
Staff Writer Edward Stoner can be reached at 748-2929 or firstname.lastname@example.org.
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