Last week Dwayne Romero of Related Colorado appeared before the Snowmass Village Part-Time Residents Advisory Board (PTRAB) to update the second homeowners on the progress of Related’s Snowmass developments. As opposed to the old days in Snowmass when we had to kick developers in the nether region to keep them from over-developing in frenetic greed-fests, people now want Related to move forward with the completion of the Base Village. However, forward progress wasn’t what the PTRAB participants heard.
Romero presented the village with a development plan that employed the wait-and-see approach to the Snowmass Village real estate scene. “We can’t manufacture a market,” he said several times. Romero touted the sale of one unit in the Viceroy hotel as a victory. The strategy is to sell as many Viceroy units as possible and then construct the second Viceroy building and sell the exact same type of product — but only if the first one sells. The other half-finished buildings in Base Village will languish while we wait and see if the Viceroy will move.
To recap the message of the meeting from my perspective: Snowmass Village is screwed.
Related’s timidity when faced with a new real estate reality was exactly opposite of what the people in the room wanted to hear. These folks were looking at the value of their second home and held a glimmer of hope that Related would be attempting to move the market by removing the blight from the center of town. Instead, what they heard was a plan that represented no plan at all.
I used to be a door-to-door salesman. The first thing we were taught as we carried our products into Denver neighborhoods was to sell ourselves first and our product second. If we projected a lack of confidence, it was passed on to our product and we went hungry when smart homeowners sent us packing.
Related’s non-plan defines everything wrong with the basic rules of selling. It represents a huge lack of confidence, and all markets need confidence. As soon as you admit that you have none, belief in your other products quickly wanes. In this case the Viceroy becomes a product that has no value. Related can try to sell it for any amount it says it is worth, but if Related lacks confidence that the rest of the Base Village has value, why would a buyer believe that the Viceroy has any?
Related might think it can’t manufacture a market for its units but it certainly can destroy one. Snowmass Village becomes the victim of the same patterns that caused the Great Recession to deepen: Related won’t take the risk to finish the Base Village because no one is buying. No one is buying because Related won’t take the risk to finish the Base Village. Something has to end this dreadful cycle and the government isn’t hanging around with stimulus funds for Snowmass.
The Aspen Skiing Co. showed up a while back wanting to reprise the luxury Fanny Hill cabins/townhomes part of its original Base Village approval. If it believes it can sell luxury units, I have to believe that Related can pull it off. The demand for high-end condos is there, the approval is all that is lacking.
I’m sure Related has looked at the luxury segment and knows what the market will bear. Its major developments throughout the United States are chocked full of wealthy buyers looking for a safe place to stash some cash. The Snowmass real estate market is the perfect place to spend some money and time. Related can summon several hundred buyers with a single keystroke in its mail program.
Related’s Viceroy units represent a lower-end segment of the market and as those units sell the company needs to consider a different group of buyers to market new products to in Snowmass. The world has changed since Snowmass was sold the cheap “hot beds” idea. Our clientele must be more diversified than what was envisioned before the Great Recession.
Related Colorado should be offering a bold plan that is designed to rekindle a real estate market that should be the envy of the world. I can’t believe that it bought back all of these properties to barely dip a toe in. Where’s the New York attitude? Where’s the cocksure swagger that will rekindle a feeding frenzy that would bite that toe off just a few years ago?
If Related Companies, as the premier developer in the United States and the primary property owner in Snowmass, doesn’t manufacture the Snowmass Village real estate market, who will?
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