Local information about Breckenridge and Summit county real estate and information about what's going on in the County.
Friday, March 28, 2014
Vail Resorts offers to buy Park City Resort’s base
In a surprise move in the midst of a contentious land lawsuit, Vail Resorts said it would be willing to buy Park City Mountain Resort’s base area and parking lots in a letter from Vail Resorts CEO Rob Katz.
Such a deal, as alluded to in Katz’s letter to John Cumming, CEO of PCMR parent company Powdr Corp., could settle the lawsuit between the Utah ski company and its landlords, Talisker Land Holdings LLC.
“Vail Resorts would be willing to pay fair market value for any of the assets you have that would be helpful to us in operating the resort,” wrote Katz in the letter on Tuesday. “While each situation is unique, there have been countless appraisals performed on land and parking facilities at the base of ski resorts. If you were willing to sell those assets, we are confident we can reach a fair price for both parties and ensure the continued smooth operation of the resort.”
Relations between PCMR and Talisker have been acrimonious over the last two years after Talisker, which owns the land on which the Utah ski resort is run, alleged that PCMR failed to renew its lease.
As reported in a recent Business Week article on the dispute, the lapse in renewal amounted to a clerical error — the papers were filed a couple days late, and the ski resort assumed all was well.
That is, until Talisker informed PCMR that they had failed to legally renew its long-term lease and that it had found a new tenant, Vail Resorts. The Colorado skiing giant joined the fray with their acquisition of the neighboring Canyons resort, just a few miles away from Park City.
Park City went to court and hearings on the matter are scheduled for April 3 and 8.
If Vail Resorts and Talisker won the suit, Vail Resorts would operate 85 percent of Park City Mountain. Powdr Corp controls the base area, which includes parking lots, lift-ticket offices and retail, as well as the water rights.
“While there has been much emotion and drama regarding these events, what transpired is relatively simple: a landlord believed that its tenant’s lease had expired and wanted higher rent. The tenant refused to pay and sued the landlord, so the landlord found a new tenant,” wrote Katz.
Katz’s letter to Cumming explored a number of options, including what could happen at Park City. Katz wrote that Vail Resorts had reached out after becoming involved in the lawsuit in 2013 to try and reach a solution, but to no avail. Vail Resorts is interested in connecting Canyons and Park City Mountain via chairlift.
“Our company believes that joining together the ski experiences of both Canyons and PCMR will create a one of a kind opportunity that could be a game changer for the Park City community and for Utah skiing and tourism,” wrote Katz.
The letter said that if Vail Resorts bought PCMR that the company would hire all the Park City employees involved with the resort.
The letter also discussed plans for a Woodward Park, which has freestyle training facilities around the world owned by Powdr.
Katz said Vail Resorts was interested in cooperating with Park City in that case as well.
Cumming told Business Week that a Woodward facility might be an option at the base if Park City loses its lease. But he added, “I will be horrified and appalled if they force me to do just that.”
Park City responds
Powdr spokeswoman Krista Parry said that no offer was actually made to Park City in Katz’s letter, and that there are number of reasons Vail Resorts can’t simply “buy out” Park City.
“We’ve put several offers on the table and none have been received,” she said.
Cumming responded to Katz’s letter in a public statement from Powdr on Monday, saying that he has no interest in “a Vail takeover.”
“We have repeatedly made it clear to Vail that PCMR is interested in exploring all possible solutions that will preserve the independence of PCMR as the nation’s premier family ski resort,” he said. “What we won’t agree to is a Vail takeover. Vail’s domination of the ski market in Summit County (Utah) would be bad for our community, bad for our guests and bad for our employees.”
He said that Katz’s letter doesn’t tell the whole story and said he preferred to present the company’s arguments in court.
“If Vail and Talisker are interested in having a public discussion about their negotiation strategy, they should be willing to disclose documents to the public. PCMR has sought to make this information public, including Talisker’s takeover proposal, only to have such requests blocked by Vail and Talisker in court. People should not be swayed by Vail’s attempt to try the merits of this case in the press. We will present our arguments to the court beginning April 3.”