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high end real estate

By Amy Fendley By Amy Fendley In 1997, it was the vision of a client of Kyber Development Limited to design and develop the most deluxe spec house in Whistler. Called The Talisman, the home was put on the market and offered at $3,500,000. The client’s knowledge of Asia led him to believe that there were individuals unaffected by North American markets. He continued to invest more money in the project, bringing the quality of the finished building to a new level. Three weeks after completion, the house sold to a buyer from Hong Kong, and Kyber had two more buyers knocking at the door. All of a sudden, in four weeks over the last Christmas period, there were more $2 million properties selling than ever before. Other clients began building high-end homes that also sold. And so began the rolling game of high-end real estate. A couple of weeks ago Akasha, a high-tech, high-end home built on spec by Munster and Sons and Taina Development in Sunridge Plateau, went on the market. Asking price: $7.3 million. As a developer, Michael Gottschalk, director of Kyber Development, admits that in many peoples’ minds developers are synonymous with "the greed factor," but there are no guarantees. "The developer assumes a lot of risks, all the risks," explains Gottschalk. "Financing risks, whether or not it will sell and what the final product will be. There are liability issues whatever they develop, and therefore are really deserving of what they get. If development was easy, everyone would do it." And when economies go south, developers can be left holding the bag. Gottschalk compares the high-end real estate market to the stock market and says that currently all indications show the market is going high, high-end. Drew Meredith, president of the Whistler Real Estate Company, says that 1999 is recovering from a very sluggish 1998, as market prices have stabilized. However, high-end sales continue to push average prices higher. In the first two months of 1997 there was only one sale over $1 million in Whistler. The same was true for 1998. During the first two months of this year, there have been 10 high-end sales. "The real estate market has benefited immensely from the great ski season and the diverse clientele in the resort," said Meredith. "The great word of mouth from these guests when they return home has got to have a very positive impact on the resort in the future." Two and a half years ago, when Whistler was beginning to reach its development limit, high-net individuals were focused on Vail, Aspen and Sun Valley. Now, a lot of those people are either looking to retire here or would like to have a vacation home here. "It’s moved on to greener pastures," says Gottschalk of the high-end market. "People are coming and they want to see what there is available." Kyber is currently building three 7,000 square foot homes. Designs for two other homes are being drawn up and they will be built later this year. Two future designs are on the table for spring 2000. "We are optimistic that the market will go up," says Gottschalk. "We’ve got a $6 million home on the drawing board for 2000 that will be finished in 2002." Gottschalk says that land is becoming more and more difficult to find, and that as there are fewer sites to develop Whistler developers are heading towards the inevitable: re-developing older homes. Homes in Alpine, Whistler Cay, Brio and Alta Vista, where the land value is significantly higher than the building on it, are ripe for redevelopment. But wealthy investors can still look at what’s around them, and right now the focus is on Horstman Estates, Sunridge Plateau and Blueberry Hill. "What’s different about a spec home is evident in what your customer would want," says Gottschalk. "We’re trying to stay neutral to the approach, but unique and finish out as high-end as we thought the market would bare." The Whistler real estate situation is worlds away from the Lower Mainland, where the Greater Vancouver Regional District reports housing starts are at their lowest level since 1945. "Whistler is a different animal, because we prey on an international market," said Gottschalk. "We’re not creating homes for people who typically live and work in Whistler. The people we’re building for may use the house for four weeks out of the year. "We’re building on an international economy, and it’s great for Whistler."