Balancing Act?

Hello Crested Butte Real Estate Letter readers!

Today is April 1st, 2006, April Fools Day, and I think we all agree, no one is fooled when it comes to what is happening to Crested Butte’s real estate market.

This month’s issue of Colorado Biz Magazine features an article about our town and the changes we’re currently experiencing. The article by Stephen Titus, "Crested Butte’s balancing act" outlines some key aspects to the recent Mueller acquisition of the ski area and their plans to invigorate our economy through ski area resort improvements and a better relationship with the Town of Crested Butte and its business community.

Interesting stuff for sure. Read on and be sure to review the cited statistics about the Crested Butte real estate market, specifically the numbers on growth, rate of appreciation and whats happening with some new developments including West Wall Lodge and Pitchfork.  

Thanks for visiting,

Channing Boucher

Crested Butte’s balancing act

New owners hope to widen customer base with ski-base development
By Stephen Titus

Crested Butte hasn’t changed a bit – or has it?  It’s still the funky, friendly town with the old-time main street.

The drive up from  Gunnison still covers vast stretches of open ranch land, veined by miles of unsurpassed trout fishing, much of it protected by conservation easements that promise it will stay that way.

And the ski resort is still packed with experts-only terrain serviced by surface lifts and 450-feet-per-minute chairs.

But behind the open space, mountain-town hipness and slow chairlifts, are changes in the shape and tone of development that has the town of Crested Butte and Crested Butte Mountain Resort cooperating in a way neither side has seen in 30 years.

The result is a rebirth for the sometimes-scruffy resort, and a symbiosis with the town that both sides hope will translate into more skiers and healthy growth for the entire area.

"For so long it was a battle," said Bill Coburn, a member of Crested Butte City Council, of the relationship between the town and the ski-resort owners. "In the past, the model was to sell off real estate and pay bills. The new owners are investing in the resort."

The nuances of Crested Butte politics could fill an encyclopedia, but according to locals and the ski area’s new management, m
uch of the rub came from a difference of business models. The ski area’s previous owners, who seemed perpetually strapped for cash, needed real-estate sales to make any improvements to the mountain and base area. But the real estate development and improvements they proposed conflicted with the town’s vision for itself as a historic mountain community full of businesses that supported the throngs of skiers visiting the nearby resort. Much of the proposed development at the ski area included large areas of commercial property that would directly compete with the town. The previous owners also wanted to expand skiing to parts of the mountain that were considered untouchable.

New owners Tim and Diane Mueller hope to take a more symbiotic approach and redevelop the base area into a bedroom community serviced mostly by the town. So far, this sits well with the Town of Crested Butte and its leadership.

"There was a lot of commercial development planned for the area," said Michael  Kraatz, vice president of real estate development for Crested Butte Mountain Resort. "We’re trying to minimize that; it creates a certain amount of friction with existing commercial property owners. We want to work in harmony with them. It doesn’t make a lot of sense to build more commercial when it already exists."

So far, so good, but the Muellers also want to expand the ski area to add more intermediate terrain and are eyeing Snodgrass Mountain, which has long been considered off-limits by people in town.

"Some people question the need," Coburn said. "But I think we’re a ski resort and you need to keep people interested for multiple days. I think we need it (more intermediate terrain). There are a lot of questions I still have, but I think it can be done."

Coburn is also a developer who has managed to stay out of town-development scuffles, he says, by building projects that fit the needs of the area and not just a financial model.

His successful Pitchfork project created 98 homes – 25 percent of them for locals – on Mt. Crested Butte, a short distance from the base area. He also built a small office and retail building in downtown Crested Butte.

Pitchfork was started before the Muellers took over the resort. In fact, Coburn purchased the land in 2000 from the resort’s previous owners, the Walton family. At the start of the project, market-priced units were selling for around $250,000. Today the same units start at $750,000. According to a local realty’s study, since the Muellers’ purchase of Crested Butte Mountain Resort, residential sale prices in the area have averaged a 50 percent increase. 

 "We’re in the early stages of what every up-and-coming ski resort experiences: a major growth spurt," said one local realtor. "Buying here now would be like getting into a ski resort such as Vail or Telluride 10 to 15 years ago, and that’s an opportunity not to be missed."

The opportunity has caught the attention of high-end resort developers like Eagle Resort Development, which is based in Avon, outside Vail. Eagle Resort has taken its expertise in areas like Vail, Beaver Creek and Cabo San Lucas, Mexico, and put it to work on two resorts in Mt. Crested Butte. The WestWall Lodge project will be 44 ski-in, ski-out condominium units at the resort’s base. According to a press release from the company, units started selling for about $400 per square foot and are now going for $700 per square foot – a relative bargain when compared with Vail’s wallet-busting $1,500- to $2,200-per-square-foot prices. Already, 38 of the 44 units are sold. The company’s other Crested Butte endeavor, Wildhorse at Prospect, will be 55 single-family homes ranging in size from 2,800 to 3,400 square feet and selling for  $1.3 million to $1.73 million.

"Vail experienced major growth in real-estate costs and sales in 1998 and 1999, then tapered off but continued steady growth," said Rich Barnes, a partner in Eagle Resort Development. "Starting in 2002, Vail has continued to set real-estate sales records every year. We have seen the same thing happen in Cabo San Lucas, and expect a similar situation in Crested Butte."

Comments are closed.