Jay Peak bombshell

[thetrailboss]

Meanwhile.... https://vtdigger.org/2019/11/14/stenger-wants-his-passport-back-prosecutors-say-no/


Sent from my iPhone using AlpineZone

 

[VTKilarney]

A recent article about the EB-5 fraud court proceedings had this nugget:

The receivership is estimating the value of Jay Peak at around $90 million to $100 million and Burke Mountain at between $10 million and $20 million, according to Schneider. Jay Peak is currently on the market, while Burke Mountain isn’t expected to be put up for sale until next year.

Article here: https://vtdigger.org/2019/12/08/qui...s-jay-peak-receiver-for-avarice-in-260m-suit/

If I recall correctly, the hotel alone at Burke cost in the vicinity of $55 million. So there's at least $35 million wiped out.

One thing is for sure. Both mountains will need improvements. Jay Peak had a TON of money poured into hotels and other buildings, but extremely little put into the mountain itself. A purchaser will need to budget for some very expensive snowmaking and lift upgrades. Burke has less of a need to deal with lifts, but the snowmaking needs a lot of attention in order to bring it up to modern day standards.

 

[ss20]

A recent article about the EB-5 fraud court proceedings had this nugget:

The receivership is estimating the value of Jay Peak at around $90 million to $100 million and Burke Mountain at between $10 million and $20 million, according to Schneider. Jay Peak is currently on the market, while Burke Mountain isn’t expected to be put up for sale until next year.

Article here: https://vtdigger.org/2019/12/08/qui...s-jay-peak-receiver-for-avarice-in-260m-suit/

If I recall correctly, the hotel alone at Burke cost in the vicinity of $55 million. So there's at least $35 million wiped out.

Wow. Given a new high-speed quad will run you...$6-9 million by its self both those numbers are pretty depressing. It's a shame there's just no money in the ski industry.

 

[1dog]

Is Stenger just an unwittingly attached to this? I don't know anything about him except he's been a staple there for years. Seems to me he was not aware of the unfolding fraud - or maybe not until it was too late?

Anyone have any insight into his character?

 

[VTKilarney]

Is Stenger just an unwittingly attached to this? I don't know anything about him except he's been a staple there for years. Seems to me he was not aware of the unfolding fraud - or maybe not until it was too late?

Anyone have any insight into his character?

It depends who you ask. The federal government has charged Stenger with ten criminal charges, including conspiracy to commit wire fraud, wire fraud and making false statements. Stenger has plead not guilty.

Stenger has settled separate civil cases with the federal government and the state of Vermont. In both of those cases Stenger agreed to pay a fine. Theoretically, an innocent person can settle a civil case because they want to avoid the risk of trial - so make of the settlement what you will.

In my opinion, Stenger was not clean. He either knew what was happening or he was the world's most incompetent business person. Take your pick. My opinion is that it was the former.

 

[thetrailboss]

Is Stenger just an unwittingly attached to this? I don't know anything about him except he's been a staple there for years. Seems to me he was not aware of the unfolding fraud - or maybe not until it was too late?

Anyone have any insight into his character?

It is very, very hard to think he did not know. He probably chose "not" to know.

 

[Jcb890]

It depends who you ask. The federal government has charged Stenger with ten criminal charges, including conspiracy to commit wire fraud, wire fraud and making false statements. Stenger has plead not guilty.

Stenger has settled separate civil cases with the federal government and the state of Vermont. In both of those cases Stenger agreed to pay a fine. Theoretically, an innocent person can settle a civil case because they want to avoid the risk of trial - so make of the settlement what you will.

In my opinion, Stenger was not clean. He either knew what was happening or he was the world's most incompetent business person. Take your pick. My opinion is that it was the former.

Seems obvious, not sure why anyone would be looking to give him a 'pass'. I don't think 1dog was, seems they were just asking.

 

[fbrissette]

It is very, very hard to think he did not know. He probably chose "not" to know.

He knew. How much he personally financially benefited from the scam is less clear.

 

[mbedle]

A recent article about the EB-5 fraud court proceedings had this nugget:

The receivership is estimating the value of Jay Peak at around $90 million to $100 million and Burke Mountain at between $10 million and $20 million, according to Schneider. Jay Peak is currently on the market, while Burke Mountain isn’t expected to be put up for sale until next year.

Article here: https://vtdigger.org/2019/12/08/qui...s-jay-peak-receiver-for-avarice-in-260m-suit/

If I recall correctly, the hotel alone at Burke cost in the vicinity of $55 million. So there's at least $35 million wiped out.

One thing is for sure. Both mountains will need improvements. Jay Peak had a TON of money poured into hotels and other buildings, but extremely little put into the mountain itself. A purchaser will need to budget for some very expensive snowmaking and lift upgrades. Burke has less of a need to deal with lifts, but the snowmaking needs a lot of attention in order to bring it up to modern day standards.

The scary thing is that 572 million was spent on all of the Jay Peak projects! Far worst than what happened at Burke.

 

[Jcb890]

$572M spent recently and your summit lift is a tram that can't run in winds over 5 mph.
Solid investment right there!

 

[BenedictGomez]

One of the funniest bits of this saga is how overnight Stenger went from supposedly one of the most intelligent men in ski business, to using the, "I am but a terribly naive pawn who was duped" defense.

 

[mbedle]

One of the funniest bits of this saga is how overnight Stenger went from supposedly one of the most intelligent men in ski business, to using the, "I am but a terribly naive pawn who was duped" defense.

And apparently, Canadian and Japanese ski resorts are looking to hire him as a consultant. He just got his passport back to be able to travel outside the county.

 

[thetrailboss]

And apparently, Canadian and Japanese ski resorts are looking to hire him as a consultant. He just got his passport back to be able to travel outside the county.

I am quite surprised that he got it back.

 

[thetrailboss]

$572M spent recently and your summit lift is a tram that can't run in winds over 5 mph.
Solid investment right there!

They would say that the money went into amenities that make the resort year-round and weatherproof. I agree to some extent.

 

[1dog]

They would say that the money went into amenities that make the resort year-round and weatherproof. I agree to some extent.

After skiing there a couple times a year 20 or more years ago comparing it to present - my kids enjoyed the water park when it was simply too cold to ski for them, and even if not too cold - the novelty was all they wanted. It's cheaper for me if the wife and kids are in there - except for that bar. . .


Then the rinks - I'm a former traveling hockey player so the draw for that crowd is good. Hotels and condos all seem to improve the area and the experience even though I don't stay in them. Enjoyed the dining and the whole vibe that was created.

I'm not old enough to play golf but there is another draw. All this investment to draw RE investment and dining experiences - where the margins are, seem to have worked. The question is at what price? Whats the ROI?

$572M -


Sugarbush didn't invest in half that I bet, yet created more year-round activity.

Weddings and mt biking,, disc golf, zip lines, and every kind of festival one can think of. Think at the sale they stated they spend $74M in ski mountain improvements, not counting hotel and condo development. Jay has Montreal 2 hours away - Mad River Valley has far fewer beds and is further away from larger metropolitan areas.


ROI - got to be a measurable return ( oh yeah and be able to fund debt - let's not forget the true problem here - am I off on that?)

 

[thetrailboss]

After skiing there a couple times a year 20 or more years ago comparing it to present - my kids enjoyed the water park when it was simply too cold to ski for them, and even if not too cold - the novelty was all they wanted. It's cheaper for me if the wife and kids are in there - except for that bar. . .


Then the rinks - I'm a former traveling hockey player so the draw for that crowd is good. Hotels and condos all seem to improve the area and the experience even though I don't stay in them. Enjoyed the dining and the whole vibe that was created.

I'm not old enough to play golf but there is another draw. All this investment to draw RE investment and dining experiences - where the margins are, seem to have worked. The question is at what price? Whats the ROI?

$572M -


Sugarbush didn't invest in half that I bet, yet created more year-round activity.

Weddings and mt biking,, disc golf, zip lines, and every kind of festival one can think of. Think at the sale they stated they spend $74M in ski mountain improvements, not counting hotel and condo development. Jay has Montreal 2 hours away - Mad River Valley has far fewer beds and is further away from larger metropolitan areas.


ROI - got to be a measurable return ( oh yeah and be able to fund debt - let's not forget the true problem here - am I off on that?)

In terms of skiing experience, from what I am seeing they have added one new beginner lift and that is it. Long laid out plans for HSQ for the Jet and HS6 for Bonnie, but no progress. Same old tired fixed-grip lifts. The last real new lift there of major significance was the Flyer....in 1999. That's 20 years ago.

 

[KustyTheKlown]

Let’s not forget the terrain expansion that has never happened and likely wont

 

[thetrailboss]

Let’s not forget the terrain expansion that has never happened and likely wont

Right. That too. I think that they even had trail names picked out for that expansion into the west bowl area.

 

[MEtoVTSkier]

I am quite surprised that he got it back.

WCAX

The court on Tuesday granted the request with conditions that travel is restricted to Canada and Japan and countries passed through on the way. The trips must be approved in advance by U.S. probation and Stenger must pledge his principal residence as security.

 

[VTKilarney]

Quiros bought the ski area for $21.9 million. Hundreds of millions were spent improving the place. It is now allegedly worth somewhere between $80 million and $100 million.

I'm no business expert, but that seems like a pretty horrible outcome.