October 06, 2006 Features & Images » Feature Story

Moving mountains o' real estate 

Editor Bob Barnett hits the road to check out B.C.'s developing mountain resorts.

Why buy a condo up on the mountain when the rivers, lakes and many trails and golf courses are down in the valley?
  • Why buy a condo up on the mountain when the rivers, lakes and many trails
    and golf courses are down in the valley?

Story and photosy by Bob Barnett

It’s an inauspicious introduction to what is supposed to be another all-season mountain resort in B.C. There is no one in sight at the base of Revelstoke’s Mount MacKenzie in the middle of September, and little indication that anyone is working on the $1 billion development. The end of the gravel road is marked only by an old Mueller double chair, a weathered barn of a day lodge and a pickup truck.

There’s nothing more to see.

The buzz of a chainsaw breaks the silence long enough for someone to buck a log and a few moments later a gregarious lumbering man in overalls wanders into view. He is TJ, a lift mechanic — perhaps the lift mechanic, as there is currently only one lift at Mount MacKenzie.

That lift, the Mueller double chair, was installed about 1990 he says, after it was rescued from a Lower Mainland ski area. He unlocks the door to the building that serves as the cafeteria, equipment rental centre, ticket sales office and ski patrol quarters. Inside, a map of the development concept plan for the future Revelstoke Mountain Resort shows 20 lifts servicing 6,500 feet of vertical terrain and 110 runs. Single-family and condo developments straddle the road leading up to the base, where the lift and the day lodge now stand.

TJ shows us out and locks the door. Standing in the autumn sunshine surrounded by the peaks of the Selkirk Mountains, we all agree it’s a beautiful area. And TJ is optimistic about the future.

“I’m glad I got my house before the real estate boom hits,” he says.

Someday there may be a boom in recreational real estate at Revelstoke. Heli-ski and cat-ski operators have been based in the town for years, including CAT Powder Skiing, which currently operates on Mount MacKenzie’s upper slopes. There is no doubt the skiing and boarding can be great.

The question is, when will the resort development happen. New runs have been cut in the trees above the lift, providing new terrain for clients of CAT Powder Skiing, and a road is being built to the top of the mountain. But the promise of an all-season resort with 16,000 beds, announced nearly two years ago, seems a long way off. Speculation about a boom in recreational real estate is a little premature.

But excitement about resort development and real estate prices seems to be the norm in British Columbia. The story at the top of page 1 in last Friday’s Vancouver Sun was about a proposed development on the Sunshine Coast that is expected to “…bring thousands of new residents and a Whistler-style resort to the area.”

Like Mount MacKenzie, an anticipated demand for recreational real estate is key to the Sunshine Coast proposal, as the story states: “Vacation property prices in Whistler are all the evidence (developer Steve) Dunton needs that Vancouverites are desperate for getaways within easy driving distance.”

From Tofino to the Sunshine Coast, and from the Okanangan to the East Kootenays, resort development in B.C. has boomed in recent years. Recreational real estate that includes seasonal activities such as golf, skiing/snowboarding, boating, fishing, hiking, kayaking and lifestyle amenities such as nearby wineries and beachfronts, is being developed at a phenomenal pace. You can’t open a magazine or newspaper in Vancouver without tripping over ads for Predator Ridge, Strand Lakeside Resort or Galiano Oceanfront Inn and Spa.

Mountain resorts are a subspecies of this group. Following the general consolidation of ownership of North American ski areas in the 1990s, there has been a rush to develop new mountain resort areas and expand existing ski areas in British Columbia. That momentum has been furthered by provincial government policies this decade that have encouraged resort development.

The reference point for most of these B.C. resorts is, to some degree, Whistler or some aspects of Whistler — in particular strata-titled condominiums, a phenomenon that has allowed resort developers to sell properties before a shovel goes in the ground and thus reduce their financial exposure.

No one wants these resorts to become another Whistler, but the proponents like the way Whistler property values have appreciated.

And it’s a fact of life that real estate development and sales are necessary to finance a resort. It’s been a long time since ski areas could make a go of it by selling season passes and hot chocolate.

Which raises a question: What is the market for mountain resort real estate in B.C.?

The obvious answer, besides British Columbians, is Albertans. With national and provincial parks blanketing most of the Rocky Mountains in Alberta, and thus limiting real estate development, Albertans seeking a second home in the mountains have turned to B.C. The East Kootenays, in particular, have been the beneficiaries.

And while a strong B.C. economy and booming real estate values have kept prices up, the even stronger oil economy in the province next door has meant real estate prices at B.C. mountain resorts are generally affordable to Albertans.

So what are people buying into?

A recent sampling — and only a sampling, not a comprehensive review — of some B.C. mountain resorts found lots of Alberta licence plates and healthy real estate markets. There is also some great skiing when the snow is good.

Each of the five mountain resorts visited is also building a village at the base of the ski area; this is where things start to differ from the Whistler model.

The proposed village area at Mount MacKenzie is only about 10 km from downtown Revelstoke. At Kicking Horse, the partially completed village is about 20 km from Golden. Panorama’s village, which is very close to buildout, is about 18 km from Invermere. At Kimberley, the resort development is almost a continuation of a suburb that extends up Gerry Sorensen Way from the town centre. And at Red Mountain Resort, the first buildings in the village master plan, the Slalom Creek condominiums, are up Highway 3B about 10 km from Rossland.

For some people this proximity to “real” towns is a virtue. A community that doesn’t live and breathe tourism and is separate from the resort experience is just a few kilometres away.

Others may find these mountain resort villages lack a nucleus. They have a sports shop or two, restaurants, a pub and places to buy souvenirs and gifts, but they don’t have the types of core businesses that were mandated in the first parcels developed in Whistler Village: a grocery store, liquor store, pharmacy and hardware store.

It’s not that one model is better than the other; they are different because of their proximity to existing towns.

Another difference is their proximity to major markets. Calgary and Vancouver are the closest major Canadian cities for B.C. resorts, with Seattle the nearest major American market. Fernie, Kimberley, Panorama and Kicking Horse are less than four hours from Calgary, which puts them in the range of weekend destinations for Calgarians. Revelstoke, however, is 400 km from Calgary, over the Rogers and Kicking Horse passes. Even though 3 million tourists pass Revelstoke on the Trans Canada every summer, it can be a challenging drive in the winter.

Someone driving to Revelstoke from Calgary would also have to pass the ski areas in Banff National Park and Kicking Horse at Golden before getting to Mount MacKenzie.

This assumes that people will get to these mountain resorts by automobile. In fact, most are drawing destination visitors from Europe and Australia who fly into Calgary or Cranbrook. Revelstoke also has an airport, although in its present configuration it is not large enough to handle commercial jets.

But destination visitors aren’t the bread and butter for these resorts or any others in B.C. Regional visits are, as Whistler has found out in recent years, key to economic sustainability.

Resort development starts with real estate sales. Resorts of the Canadian Rockies was put together by Charlie Locke in the late 1990s to get into the resort consolidation game. Locke, who is now out of the picture, brought Kimberley, Fernie, Lake Louise and Nakiska together under the RCR banner and started developing mountain resorts at Kimberley and Fernie.

Kimberley’s North Star Mountain, like Rossland’s Red Mountain, started off as a family ski hill operated by the local ski club and strongly supported by the mining company, Cominco — which was the reason the towns existed in the first place. As Kimberley’s Sullivan Mine began to reach the end of its life new fortunes were being made in mountain resort real estate.

Today at Kimberley, condominiums cover the lower slope of North Star Mountain, interspersed only by a couple of lifts and one of the three golf courses in town. Sitting above the town of Kimberley in the Purcells and looking across at the Rocky Mountains, the area is alive with outdoor recreation opportunities.

And that is perhaps Kimberley Alpine Resort’s downfall: why buy a condo up on the mountain when the rivers, lakes and many trails and additional golf courses are down in the valley? And the rental revenue from those condos may not be what was expected. Last winter Kimberley removed the covenant requiring condos to go into a rental pool because owners said it was impeding sales.

Up the valley, past Invermere and along Toby Creek Road, Panorama is more compact and isolated than the resort at Kimberley. The Panorama village has everything you’d expect at an Intrawest resort: a nice mix of various types of accommodation, a good golf course and everything well landscaped. Like Kimberley, you would have to leave the Panorama village area for groceries and most non-skiing activities, but there is a sense of a community at Panorama. It may be because the valley is cozier or because there are more single-family houses at Panorama and the owners flock to them on weekends.

Meanwhile, at Kicking Horse the first two large condo-hotels in a planned village have been built, along with another condominium property built by Whistler’s Rod Nadeau. But the emphasis right now is on high-end single-family development. Ballast Nedam Canada Ltd., the resort developer, is also the recommended builder for the single-family houses.

Kicking Horse, being just off the Trans Canada Highway, gets tourist traffic year-round. For that reason the developers built the Golden Eagle Express Gondola to take people from the base of the mountain directly to the Eagle’s Eye restaurant at the top, where fabulous food and views are proffered.

A golf course is planned at Kicking Horse, but like much of the village it has yet to be developed. Summer activities currently consist of downhill mountain biking on the mountain, rafting in the rivers, golf in Golden and paragliding.

Back in the West Kootenays, Red Mountain Resort is finally getting off the ground. There aren’t any new lifts yet, but the first condo development in what will become the village is under construction.

Red was purchased two years ago by Red Mountain Ventures, a private investment group led by San Diego’s Howard Katkov. A master development plan has been agreed to with the town of Rossland. The plan includes building 1,400 accommodation units and 70,000 square feet of commercial space in the village. It also includes rights to expand the ski area from its current 1,585 acres to 4,200 acres.

Red and Granite mountains have always been favourites of skiers and boarders, and the town of Rossland is as funky and charming as they come. Whether that’s enough to draw investors remains to be seen.

Rossland’s relationship to Red and its development is more advanced than Revelstoke’s with Mount MacKenzie, but there are parallels. The City of Revelstoke desperately wants the Revelstoke Mountain Resort to succeed, and as owner of some of the land included in the development parcel the city has been an active participant in various development plans over more than 20 years.

The man behind the development of Mount MacKenzie is Toronto’s Hunter Milbourne, who at one time was backing the Garibaldi at Squamish resort proposal. Milbourne has an agreement in place with the City of Revelstoke and provincial approval for resort development. Clearing for the village and a golf course at Mount MacKenzie was to have begun this summer but is now scheduled to begin next spring.

But it may be that given the amount of mountain resort development that has already taken place across B.C., and other ski areas’ more favourable proximity to markets, expectations of a recreational real estate boom eventually reaching Mount MacKenzie are optimistic.

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