Co-op may continue in revised partnership
The forward progress of Bear Valley Mountain Resort will soon be in the hands of Skyline International Development Inc., and leaders of the investment company want to take the Bear Valley Mountain Cooperative along for the ride.
“The co-op is the engine,” said Skyline Chairman and President Gil Blutrich at a town hall meeting Saturday. “Skyline is the supercharger.”
Blutrich shared his vision at the gathering hosted by the co-op at the Bear Valley Lodge Cathedral Lounge. Co-op members were given information about new options – including opt-outs – and the 250 to 300 people in attendance were introduced to Skyline executives, who enthusiastically spoke to an ongoing collaboration.
“We see a partnership between Skyline and the co-op as a critical element in the future of Bear Valley by making sure Bear Valley remains a viable and productive resort operation,” Skyline CEO Michael Sneyd said. “The key to making the operation profitable is to continue to improve the brand in the Bay Area and really bring back the ski-area visits that Bear Valley enjoyed.”
And as he said at the meeting Saturday, “We put heads in beds.”
Skyline is a publicly traded hospitality and real estate development and management company based in Toronto. Skyline currently owns various hotels and four southern Ontario resorts, two of which include ski amenities.
One member of Bear Valley’s current ownership group – Dundee Resort Development Corp. – and Skyline have been previously affiliated through Ned Goodman, the president and CEO of Dundee Capital Markets Inc. who served on Skyline’s board of directors until Skyline became a publicly traded company in March 2014.
“Dundee is one of Canada’s most successful companies, and Ned is one of the most experienced and respected developers in the country,” Sneyd said. “Ned made significant investments in Skyline, right until the company went public” and is no longer on the board.
Still, Sneyd said discovering the resort was “serendipity.” He had heard about the opportunity from a real estate broker in the United States and filed a confidentiality agreement with the broker. Around the same time, Blutrich was meeting with Goodman, who mentioned the agreement.
“We came at it both ways,” Sneyd said.
And they were both interested, leading Skyline to sign a letter of intent July 31, mere days after the co-op had reached its shareholder goal.
In an email to members, Bear Valley Cooperative leadership said it was informed Aug. 1 that Dundee signed an exclusive purchase and sale agreement for the ski area with Skyline and that the cooperative’s letter of intent would be terminated.
“I congratulate you again on your success with organizing the co-op and galvanizing community support,” wrote Dundee Resort Development President Greg Finch in an email that co-op leadership conveyed to its members. “Although the co-op may not be the purchaser of the ski area, the community’s support and participation is critical to the long-term viability of Bear Valley.”
The co-op has more than 900 members, and as it currently stands, those members still have the right to vote, receive member benefits and voice their opinions on how the mountain and village are operated, according to Sky-line’s preliminary discussions with the co-op.
If the resort were to eventually be bought out by a third party that didn’t want to continue the partnership, members would be refunded their individual shares, Sneyd said.
When Skyline was initially considering the purchase of Bear Valley, Skyline saw the co-op as an asset, Sneyd said.
“Skyline would not have invested without this showing of community support,” he explained. “At all of our properties, we have a membership club-style program. We’re quite used to working with the community and finding a win-win for their involvement, the resort activities and capital improvement plans.”
Though the details of the partnership are still being worked out, Sneyd said Skyline’s immediate priority is collaborating with the co-op to meet Bear Valley’s needs.
As outlined at the meeting Saturday, Skyline will likely invest in all maintenance, immediate capital improvements, marketing, operations and financial risk. The co-op will continue toward membership growth, community participation, benefits for membership and capital improvement projects by approval.
In the coming years, Sneyd said that Skyline hopes to develop the village, but that likely won’t happen immediately.
“Really, you have to have a viable resort that is in demand before you start selling real estate,” Sneyd said. “We plan to work with members of the co-op and community on specifics of design” for the village.
After visiting Bear Valley briefly for Saturday’s meeting, Sneyd said he intends for the development to feel “organic, that it looks like it was developed over time at the mountain, rather than many resort experiences elsewhere, where it looks like it was just developed yesterday and feels a little bit plastic-y. We want it to feel timeless.”
And as Skyline invests in the village, the co-op may focus its financial resources elsewhere.
“They believe the money should go into the mountain,” Sneyd said. “What we’ve said is that we would participate and agree where their co-op seeds get invested.”
Over time, Sneyd said Skyline plans to invest in the lodges, snowmaking, the rental areas, retail shops, food and beverage offerings, and the lift from the village to the top of the mountain – a project that’s long been pursued and delayed at Bear Valley.
But – with Skyline’s operation set in Toronto – Sneyd recognizes that it needs asset managers nearer to Bear Valley. Based upon recommendation, Skyline selected Chris Ryman and Betsy Cole, a Northern California ski-industry duo with decades of experience. Sneyd said the pair will meet with the current management team at Bear Valley.
“They will review and make sure that the onsite management team is establishing a great business plan and fulfilling the great business plan,” Sneyd said.
And as Skyline continues the course toward purchase, the co-op is working with its members.
“They want to confirm with their membership that this slightly different structure for the co-op is still acceptable to their members,” Sneyd said.
Next week, the co-op promised its members the details of the proposed relationship, options available to members, the process required to vote on this new direction and giving potential refunds to members who may not want to continue with the cooperative effort after this change.
But Sneyd said he anticipates – and hopes – the partnership will continue.
“I can’t imagine the co-op not continuing,” he said. “It makes so much sense: Skyline will take care of any operating shortfalls. We all know about the resort industry; there are ups and downs. Co-op members get all the same benefits they were promised, and they now have an experienced resort operation team coming in with equipment and commitment to turn Bear around.”