Through the $830 million transaction, a New York hedge fund manager will assume ownership of 14 properties currently held by CNL Lifestyle Properties, including major ski resorts, theme parks and other recreational locations.
A Florida-based real estate investment trust has reached an agreement to sell more than a dozen major ski resorts and other properties from Maine to California, the Associated Press (AP) reported.
Under the deal, AP reported, New York hedge fund manager Och-Ziff will assume ownership of 14 properties currently held by CNL Lifestyle Properties, including Sunday River and Sugarloaf in Maine, Crested Butte in Colorado, Brighton in Utah and Sierra-at-Tahoe in California.
Other ski resorts involved in the transaction are Cypress Mountain in British Columbia; Jiminy Peak in Massachusetts; Loon Mountain and Mount Sunapee in New Hampshire; Okemo Mountain in Vermont; Mountain High in California; and Summit-at-Snoqualmie and Stevens Pass in Washington state, along with the Gatlinburg Sky Lift in Tennessee.
C&RB reported on the potential sale of the properties last year: http://clubandresortbusiness.com/2015/03/17/cnl-lifestyle-properties-considers-selling-16-ski-resorts/
Missouri-based EPR Properties will retain the rest of CNL’s holdings, AP reported, including the Northstar California ski resort and 15 waterparks and amusement parks.
CNL will receive about $830 million in cash and stock under the purchase and sale agreement, AP reported. When the deal closes, it will be the largest ski-resort transaction in the history of the sport. The deal is expected to close in 2017.
The resorts’ staffs and customers, however, aren’t expected to experience a big impact from the change of ownership, AP reported. Long-term leases will remain in place, so mountain operators will remain unchanged after the properties change hands.
CNL and EPR are real estate investment trusts, which are investment vehicles for a variety of properties including hotels, office buildings and malls, AP explained. They own the properties and make money through leases with other companies that manage and operate them.
CNL Lifestyle Properties was valued at as much as $3 billion in 2012, AP reported, with ownership of more than 100 water parks, ski resorts, marinas and senior housing developments. As part of its anticipated exit strategy, CNL has been selling off assets in the real estate investment trust.
Under the deal, an Och-Ziff subsidiary will assume ownership of its share through cash and a $244 million loan.
Steve Kircher, an executive from Michigan-based Boyne Resorts, which has leases to operate seven of the ski resorts, said it was his understanding that Och-Ziff was brought into the transaction to diversify EPR’s exposure to ski holdings, AP reported.
Kircher said skiers shouldn’t be alarmed. Current lease holders will continue to operate the resorts as they have in the past, he said. From a skier’s perspective, it’s akin to a home mortgage being sold between banks. “It’s not an event from a skier’s perspective,” he said.
Rhode Island Public Radio reported that Bob Luce, Chairman of the Select Board in the Sugarloaf resort’s hometown of Carrabasset Valley, Maine, felt that the handover looked like good news.
In recent years, Luce said, it was apparent to the mountain community that the owners did not have much cash to invest in equipment and other needed upgrades. Two years ago, Sugarloaf skiers were injured when its King Pine lift spun backwards, Rhode Island Public Radio reported, and this summer, Sunday River’s Spruce Peak lift collapsed.
“They haven’t had the capital so I think they’ve both been struggling with that,” Luce said. “It’ll be better in the future going forward; it’ll give them additional access to capital to do whatever expansions they might have in mind.”
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