Receiver Announces that Burke has a Stalking Horse Bid and Deal will Close by End of 2024

[BenedictGomez]

Nepotist management? That'd be going from QBurke to GBurke.

 

[B-Eastski]

Investors Say Receiver Is Ignoring Their Bid for Burke | Seven Days

A pair of investors say they've offered $10 million to buy Burke Mountain ski area but have heard nothing from the receiver that controls the property.

m.sevendaysvt.com

Well, these two guys are not the purchasers. They also seem pretty butt hurt. I don’t see the point of them going up to East Burke on Friday. Frankly, I think they were lowballing. They should not be at all surprised that their $10 mill offer for a ski area and a $50 mill hotel got no traction. And they aren’t really locals. Jamaica, Vermont is a long ways away…..

Who is valuing the hotel at $50 million?

 

[thetrailboss]

Who is valuing the hotel at $50 million?

It cost $50 mill to build. At least that’s how much Q and company raised from EB-5 investors.

 

[B-Eastski]

Is 10-12 million a reasonable offer ? Town-assessed value is $20.3 million. Amazing that you could get an entire 2000 vertical foot ski area for barely more than the price of a

It cost $50 mill to build. At least that’s how much Q and company raised from EB-5 investors.

Unlikely

 

[thetrailboss]

Unlikely

Yeah, I am not an expert on the valuation of assets, but surely there has been some depreciation. But $10 mill is laughable for both the ski area and hotel, assuming that is what they were offering.

 

[B-Eastski]

You are probably correct, but you are not completing the equation. There is 10s of millions of infrastructure work to the mountain and hotel required to bring it into the future.

 

[Big Wave Dave]

You are probably correct, but you are not completing the equation. There is 10s of millions of infrastructure work to the mountain and hotel required to bring it into the future.

So where you spending the money?

 

[B-Eastski]

So where you spending the money?

The hotel has structural issues & hvac issues, lifts need to be overhauled and there needs to be major upgrades in snow making. Right there you are talking 10-20 +

 

[drjeff]

If I remember the numbers correctly, and I might be off, last I recall the recent going industry average for a ski area sale price has been in the 10-20x EBITDA range. Not sure what the EBITDA on Burke is and how that would relate to the figure the Investors are looking to buy it for vs the figure that the receiver is looking to get for the original investors. In the end, I am guessing that the receiver will have to get the original investors to take an offer that is probably at the very high end 25 cents on the dollar of their investment, and probably a good chunk less than that. As the fiduciary responsibility saying goes, investments do carry risk and losses can and do occur....

 

[thetrailboss]

The hotel has structural issues & hvac issues, lifts need to be overhauled and there needs to be major upgrades in snow making. Right there you are talking 10-20 +

The HSQ's are relatively new. The T-Bar is new. The J-Bar needs replacing. So I don't know what you mean by "overhaul" the lifts.

Snowmaking, yes.

The Hotel--I know you had said structural issues, but I have not seen anything clear explaining what is needed.

Sherburne Lodge is shot. It was last renovated in 2005.

Mid-Burke is, well, Mid-Burke.

 

[thetrailboss]

You are probably correct, but you are not completing the equation. There is 10s of millions of infrastructure work to the mountain and hotel required to bring it into the future.

Typically for purchase price one does not consider the improvements that are needed.

 

[B-Eastski]

The HSQ's are relatively new. The T-Bar is new. The J-Bar needs replacing. So I don't know what you mean by "overhaul" the lifts.

Snowmaking, yes.

The Hotel--I know you had said structural issues, but I have not seen anything clear explaining what is needed.

Sherburne Lodge is shot. It was last renovated in 2005.

Mid-Burke is, well, Mid-Burke.

Every time i have been to Burke HSQs have had issues. Waited an hour on the lower one. Sure was pissed. Relatively New in detachable is different than relatively new in fixed.

 

[thetrailboss]

Every time i have been to Burke HSQs have had issues. Waited an hour on the lower one. Sure was pissed. Relatively New in detachable is different than relatively new in fixed.

Sherburne HSQ is now 20 years old. It was struck by lightning a few years back. From what I understand, the concern has been maintaining it. Does it need replacement? Unlikely. Does it need perhaps some deferred maintenance? I'd say yes.

 

[Big Wave Dave]

Every time i have been to Burke HSQs have had issues. Waited an hour on the lower one. Sure was pissed. Relatively New in detachable is different than relatively new in fixed.

I’ve skied Burke around 30 days this year and lost maybe a couple hours due to lifts being down. They do seem to have some issues but they always open back up quickly.

Burke needs a new lift and a dedicated intermediate pod. Until that happens it won’t draw the crowd it needs. The long proposed West Bowl area would be the fix.

 

[thetrailboss]

Burke needs a new lift and a dedicated intermediate pod. Until that happens it won’t draw the crowd it needs. The long proposed West Bowl area would be the fix.

From the NEK had an easy and inexpensive proposal: shorten the Willoughby Quad and have it end right below Upper Fox's Folly so that intermediates can ski the lower blues. But the poor Willoughby is dying a slow and painful death.