Park City Home Buyers Change

By Todd Anderson

Dec 16, 2010

The Real Estate market in Park City, Utah has not been immune to the value changes that the rest of the country has seen. Early on in the National housing and credit collapse many agents in Park City claimed that our area was insulated and we would not be affected by the changes the rest of the country was experiencing. An in depth analysis of our market now shows that market changes in Park City mirror the national averages. Prices have retreated to the 2005-2006 levels in many areas while falling well below that in the outlying areas of the city. The change has occurred in residential entry level condominiums and every market segment right through multi-million dollar luxury ski villas. Changes can be seen not only in sales prices, but also in the mindset of the Buyers. Park City is a destination ski resort area offering arguably one of the county's best vacation and second home experiences. The things that made Park City desirable before the economic change have not changed, but the Buyers now have a different perspective on real estate here. Buyers still want to own in Park City and the emotion behind the decision to buy here has not changed. The focus that drives which Park City home a Buyer purchases has changed and the emotional drive toward a particular home is gone. In past years Buyers fell in love with a home, now the buyers can be just as focused on the deal as they are a particular home. Park City real estate buyers now often have a somewhat indifferent attitude to the home or condominium they are purchasing; as long as they are getting a deal, they love the home. Prospective property owners are writing offers on multiple homes with the intent of purchasing whichever property presents the best bargain. Park City real estate Buyers are still focused within a particular area, property type, and price range, but the message to Sellers is "I like your home best, but I'll substitute it with the home down road or in the next subdivision if I believe it represents is a better value".

Tags: bargain, Buyer, condominium, deal, home, Luxury, Park City, purchase, seller, Ski, Utah
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Developer Buys Promontory at Auction

By Todd Anderson

Apr 27, 2009

In the spring of 2008 creditors forced the Promontory luxury golf subdivision in Park City, UT into bankruptcy. The developer, Arizona based Pivotal defaulted on loans amounting to over $270M.

On April 15, 2009 a group named Pivotal 7000 headed by the CEO of Pivotal, Francis Najafi, purchased the development for a price far less than the debt on which Pivotal defaulted. The $70M bid by Najafi which was approved by the U.S. Bankruptcy Court effectively wiped out $275M in loans that had been packaged by Credit Suisse.

During the bankruptcy, Promontory maintained its operations which consist of two golf courses, clubhouses (golf, tennis, kids, outfitters, etc) an equestrian facility and more than 1000 building lots. The assets have been valued between $230M and $560M.

The new ownership plans to move forward with Promontory's original vision for the second home luxury community. While some property owners within Promontory may still have a bad taste for Pivotal, the fact that the development is no longer in bankruptcy and is being run by a company familiar with the project may be a benefit. Promontory's plan of reorganization binds Pivotal 7000, LLC, as the new owner, to observe key provisions of the court-approved plan and sale procedures. These provisions include the obligation to honor Promontory's county-approved master plan, the Promontory Club's membership agreements and membership plan, and the assumption of all lot purchase agreements with Promontory lot and home owners. In addition, provisions have been made in the plan for funding of legitimate unsecured creditor claims and the creation of a reserve fund for Promontory's homeowners' association, the Promontory Conservancy.

The stigma of bankruptcy and the relatively large number of speculative purchases and building that was done by private investors has hurt the market in Promontory. The luxury homes that are for sale in the Promontory area are currently some of the best values in Park City. Now may be a perfect time to invest or purchase a second home in a golf course community as the developer should be on much more stable ground for the near future.

On another positive note, Golf Digest just ranked the Jack Nicklaus and Pete Dye designed courses at Promontory as the number 2 and 3 courses in the state behind Glenwild (also in Park City).

Tags: auction, bankruptcy, development, Glenwild, Golf, homes, Luxury, Park City, Promontory, purchase, rankings, Real Estate, Ski
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Promontory Bankruptcy Auction Date Set

By Todd Anderson

Mar 22, 2009

Efforts to work through the Chapter 11 bankruptcy moved forward last week as it was announced that the Promontory Development will be auctioned off on the 15^th of April, 2009. Credit Suisse has opted to send the property and operations to auction rather than provide the $70 Million in exit financing mandated by the bankruptcy court. It is expected that Promontory will emerge from bankruptcy in April and the winner of the auction will be bound to observe key provisions of the Court-approved reorganization plan and sale procedures. The provisions include the new owner's obligation to honor Promontory's County-approved master plan, the Promontory Club's membership agreements and membership plan and the assumption of all lot purchase agreements with Promontory lot and home owners. With some luck, this will remove some of the cloud of uncertainty that has been over the development since it was forced into bankruptcy in March of 2008. The Promontory luxury golf, equestrian and "club" community of second homes covers approx. 7200 acres in the Park City Area with a master plan including 5 golf courses (2 are currently complete), pool, tennis, kids clubhouse, trails, outfitters cabin, ski resort amenities at Deer Valley and Park City Resorts and more (many of which are currently in place). The area includes over 1900 home sites. Of the 700 or so lots that have been sold, nearly 300 have homes completed or homes under construction. Many of the homes and lots were purchased and constructed during the Park City real estate boom. They have not escaped the current market downturn and the effects of the bankruptcy cloud over the development. There are currently over 100 lots for sale and nearly 90 homes in various states of completion. Many of the lots are offered at prices near or below their original sales price. There are 26 homes available for under $2 Million (I can recall a time two years ago when there was only one). If The Promontory development emerges successfully from this bankruptcy and is able to complete its original vision as a four-season, multi-generational luxury community, this may prove to be one of the best times to purchase. See the Promontory golf page of the YouInParkCity.com website for a couple of our favorites.

Tags: auction, bankruptcy, development, Golf, homes, Luxury, Park City, Promontory, purchase, Real Estate, Ski
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