The aggressive fight by Vail Resort to get total ownership of Park City Mountain Resort continued June 19, where the Colorado resort demanded an ‘Order of Restitution and Damages’ from Park City Mountain Resort.
Third District Court Judge Ryan Harris ruled in favor of Vail for the Order of Restitution, but then stayed that ruling until another hearing on August 27. He also ordered both companies to engage in mediation with a third party mediator before the next hearing. Meanwhile, he indicated that PCMR shouldn’t begin the removal of their lift towers, lifts, snow making and other property from the land which is now owned by Vail and Talisker Holdings, a Canadian corporation.
For those not familiar with the back story, here are the details: PCMR has leased the land on which most of its runs are located for decades. The original owner sold that land to Talisker, a Canadian development company that then gained ownership of Canyons Resort. Talisker then partnered with Vail. Vail now owns Canyons, and wants to dominate Park City’s resort industry by also obtaining ownership of PCMR, which is currently owned by the John Cumming family.
In 2011, after Talisker purchased the land, PCMR was late in making its payment for the lease. One year later, in 2012, Vail partnered with Talisker. At that point, both parties sued PCMR, saying that the late payment broke the lease, and the land had thus reverted to Talisker, who then sold it to Vail. The Talisker/Vail claim to ownership was upheld by Judge Harris.
Vail immediately gave an eviction notice to PCMR. The legality of the eviction will also be decided by Judge Harris
Vail has a history of aggressive business tactics, which has enabled them to become the largest mountain resort owner in America (see below). During the June 19 hearing, Vail argued that PCMR has no ownership of its lift towers, lifts, snow making or other property, because it was all ‘affixed’ to the land.
In other words, Vail not only wanted (and got) legal rights to the land formerly leased by PCMR, but now argues for the rights to everything on that land, so the resort will be ready for Vail to open and operate when the season starts.
However, PCMR argued that most of the lift towers are only bolted to a substructure beneath, and thus are not legally attached to the land—and if Vail wins its claims to the leased land, PCMR has stated it will remove the towers, as well as the water lines for snowmaking. This is only part of the standoff that may keep PCMR from its normal season opening.
The heart of the matter is that while Vail may now own most of the resort’s trails and terrain, PCMR owns the entire base area, the lower lifts and the parking lots. Another 208 acres around the base is owned by PPI, Park Properties Incorporated. But PPI is also owned by the Cumming family, and John Cumming has stated that none of the property is for sale.
Without PCMR’s base area, Vail has no commercial access to its resort property. Without Vail’s resort property, PCMR has very little terrain. Without an agreement between them, there will be little financial reason for the resort to open for the 2014-2015 season.
By staying his decision until the end of August, Judge Harris has created even more pressure for the two corporations to reach an agreement. The first winter storms begin to hit Park City in early October, and snow making must begin in October in order for the resort to be ready to open by its usual date in November. That would mean any construction—or deconstruction—would have to be completed within two months, which is extremely unlikely. A legal eviction would tie up the resort opening even longer.
PCMR provides about 27 per cent of Park City’s winter revenue. The resort’s lead attorney, Alan Sullivan, says, “The impact of an eviction would be enormous, it would have an enormous impact on my clients, but it would have an even greater impact on the people of Park City and Summit County.
Team Schlopy will have more news about the fight between the two resorts as it unfolds, and will be the first to tell our readers when—and if—PCMR will open this coming season.
About Vail Resorts, Inc. (NYSE: MTN)
Vail Resorts, Inc., through its subsidiaries, is the leading mountain resort operator in the United States. The Company’s subsidiaries operate the mountain resorts of Vail, Beaver Creek, Breckenridge and Keystone in Colorado; Heavenly, Northstar and Kirkwood in the
Lake Tahoe area of California and Nevada; Canyons in Park City, Utah; Afton Alps in Minnesota and Mt. Brighton in Michigan; and the Grand Teton Lodge Company in Jackson Hole, Wyoming. The Company’s subsidiary, RockResorts, a luxury resort hotel company, manages casually elegant properties. Vail Resorts Development Company is the
real estate planning, development and construction subsidiary of Vail Resorts, Inc. Vail Resorts is a publicly held company traded on the New York Stock Exchange (NYSE: MTN). The Vail Resorts company website is www.vailresorts.com and
consumer website is www.snow.com.