Okay everybody, up from your computers. Stand up. Take a big breath. That’s better. By now you’ve probably received (and long forgotten) an email from some Mammoth real estate entity about a press release issued on April 5 from Mammoth Mountain Ski Area. While the world yawned, young (and some not-so-young) and hungry Mammoth agents made something of it. Perhaps this would kick-start the next buying frenzy?
The press release stated that MMSA and their real estate marketing arm known as Playground, are about to commence an earth shattering series of announcements about the future plans of Mammoth. “After months of comprehensive planning by Starwood and some of the west coast’s leading architects and designers, we are thrilled to now be in position to move forward with Playground to roll out MMSA Development Company’s 2007/08 development program.”
The immediate upcoming releases are destined to be about the new luxury hotel brand in the south village and a new quarter ownership opportunity “nestled alongside Sierra Star’s seventh fairway.” Both have been “much anticipated.” (By whom?–Starwood investors looking for some return on investment? By hungry sales team members looking for commission income?) “Both offerings are completely unique in the market and extremely well positioned.” (Can anybody explain what “well positioned “ means in today’s psycho-babble marketing lingo?)
The “buzz” of the press release was the “unveiling of plans involving more than $1B of new investment in Mammoth Mountain Ski Area”. This leads to Point #1 of Reading Between the Lines. It doesn’t mean Starwood is going to invest $1B into the Ski Area. It means they plan on developing properties (namely condo hotel and fractional units) that they are projecting will generate $1B worth of sales. Maybe a minute fraction of this $1B will actually be tilled into the ground without a direct multiplier of return on investment. Essentially, they are looking for someone (like you) to finance their otherwise un-finance able hotel rooms.
The press release goes on, “Starwood’s ongoing capital investment and its consolidation of real estate and operations marks the beginning of a truly exciting new era for Mammoth…elevated to an entirely new level.” This leads me to Point #2 of Reading Between the Lines. (I dearly apologize for my cynicism.) I think they call it déjà vu (all over again). This sounds just like a press release issued by Intrawest ten years ago. Where are my old Mammoth Times issues or even better the “mail drop” marketing blasted material for Juniper Springs Lodge? (Maybe we now know what “well positioned” means.) Anybody who’s been paying attention knows what this “elevated to a new level” is likely to mean. Charles Ponzi knew.
Point #3 of Reading Between the Lines; hold on to your wallets! The “battle of the fractionals” is about to begin. I’m envisioning timeshare-like pitches while you fill your gas tank in places like Mojave and Big Pine. “Sir, I can tell by the skis on top of your car that you are heading to Mammoth for the weekend. How would you like a free lift ticket? Just sit through a 30-minute presentation…” Or, “Is that a DVD player in your Escalade? we now have a newly updated version of “On the Shoulders of Giants” (except Barry Sternlicht is now one of the Giants) on DVD that you can play on your way up the hill.”
Seriously, all we need are more fractional properties. Fractionals are destined to be the resort equivalence of today’s sub-prime mess. I can hear people now, “but it was so affordable to get in, but now the monthly is killing me and there’s nobody to buy me out”. AND these fractional properties are selling so well right now (NOT!) that they’re going to build a whole bunch more. And each offering will promise a better location, services, amenities and yadda yadda. But don’t worry Mr. Buyer, they’re well positioned!
Point #4 of Reading Between the Lines; We know that last month Peter Dupuis and his company S&P Destination Properties (currently marketing the Tanavista project here in Mammoth) were being chased and courted by Starwood and MMSA. Instead the press release announces Playground will remain the marketing and sales reps. S&P apparently has better things to do in exclusive places like Dubai. Playground are minor leaguers compared to S&P. Maybe Pete will do some consulting.
Point #5 of Reading Between the Line; And this is becoming the most important point of all. Now, more than ever, is the time to be discerning about your resort real estate investments in Mammoth Lakes. Enough said.