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Understanding the real estate economy



VAIL, Colo. — Real estate construction for vacation and retirement homes has been the big story for 10 to 20 years in Aspen, Vail, and Jackson Hole, and it continues to get even bigger. In an extended series on this phenomenon, the Vail Daily notes the increasing concentration of wealth.

Peter Francese, a demographic trends analyst for Ogilvy Mather, explains it this way: "The top 20 per cent of income households take home 50 per cent of all the money earned in this country."

Mick Ireland, a Pitkin County commissioner, further explains that the bottom 60 to 80 per cent of the population has seen little or no growth in income, while the top wage-earners have 20 times more wealth than they had 20 years ago.

One problem with this new real-estate based economy is that it has elevated real estate prices but not necessarily wages to correspond. Thus, affordable housing has become a pressing, even desperate need. But Ireland warns that, at least in Colorado, the answer cannot be found by importing workers on a daily basis. The state highway treasury is nearly empty.

But a more far-reaching problem is being talked about by various individuals: when this new boom ends. "In 10 or 15 years, there will come a time when the boomers are going to say it’s time to cash in and retire," said Francese. "I’d hate to be the last guy to have bought a million-dollar condo in Vail, because when they move on, they do so with a vengeance."

Echoes of ‘Chinatown’

FRASER, Colo. — The 1974 film Chinatown resonates broadly in the West, but perhaps no place so urgently as Colorado’s Fraser Valley, where Winter Park is located. That film examines the machinations behind development of Los Angeles in the 1930s and that city’s reach to into the distant Owens Valley, on the far side of the Sierra Nevada, to get the necessary water.

The Fraser Valley has had a similar relationship with Denver that dates to the late 1920s. Located at the very headwaters of the Colorado River, the valley exports 60 per cent of its water to Denver and its suburbs. But Denver still retains rights for substantially more water and wants to exercise those property rights. The effect would be to take up to 80 per cent of the valley’s water.

With these parallels in mind, a group called Friends of the Fraser River recently showed Chinatown at a local library followed by a discussion among 40 people. While the film ends in murder, the local activists are confident of a more peaceful resolution of their disagreement with Denver.

Gunnison sees threats east and west

CRESTED BUTTE, Colo. — Water continues to be in the news in the Gunnison Valley, where Crested Butte is located. As they have for decades now, the locals continue to worry about interlopers from both the east and the west.

To the east is Colorado’s Front Range urban corridor, where both farms and cities began outstripping the native water supplies 125 years ago. Whether any water in the Gunnison Valley is legally available to feed the large and growing population of the Front Range remains disputed. Just the same, locals are wary of penetration by those who may be less than resolute in their opposition.

That became apparent when the top candidate for a job as manager of a local water district was the director for a Front Range district that depends upon transmountain diversions. The candidate apparently didn’t share the resident "not one drop" belief, although board members for the Upper Gunnison River Water Conservancy District told the Crested Butte News they are confident that the manager, if hired, will learn to espouse that philosophy.

Meanwhile, to the west, the locals see threats from the down-valley states, particularly Arizona. Scott Balcomb, who represents Colorado in inter-state negotiations, recently told a gathering of Western Slope representatives that what happens downstream in Las Vegas, Los Angeles, and Phoenix could ultimately affect water supplies in the ski and other mountain towns of Colorado.

What do bankers know?

KETCHUM, Idaho — If population and development growth are the big stories of the ski and resort valleys of the West, the profusion of new banks is a startling emblem. While some say that the new banks are simply free enterprise at work, others see speculative fever.

"What we have learned is that bankers are no better at picking investments than the rest of us," writes Tim Ryan of Ketchum in a letter published in the Idaho Mountain Express. "We now have eight banks in our little town, with two or three more on the way. What are these people thinking?"

School enrolment expected to fall

CANMORE, Alberta — Enrolment in public schools in the Bow River Valley, where Banff and Canmore are located, continues to decline.

In the early 1990s the schools began growing briskly, but the 1999 enrolment of 2,645 has now fallen to 2,243. This loss can be explained by growing enrolment at a Catholic school and also at a Francophone school, which together have siphoned 385 students.

But the fuller story is a familiar one in fast-growing resort valleys of the West. A vast majority of newer residents are "empty nesters," many of them baby boomers. "Few people with children can afford to live here, few are moving here, and many are leaving," reports the Rocky Mountain Outlook.

Intrawest takes reins in Canmore

CANMORE, Alberta — Intrawest has signed on to manage a 214-suite Solara condo-hotel in Canmore, the company’s first business proposition in Alberta. However, it’s not the first such relationship between the two. Intrawest manages 3,000 accommodations for Solara in Canada. Solara has 8,000 units worldwide. As well, Intrawest manages hotels that bear the Westin, Marriot and Hard Rock brands.

"Skate bum" returns home

KETCHUM, Idaho — Described as an "old-timer’s old-timer," Grace Laughlin is leaving Ketchum and Sun Valley after 57 years. She has returned to her original hometown of St. Louis, Mo., where she has family members.

The Idaho Mountain Express explains that Laughlin was already smitten with ice skating when she saw a movie in 1959 called "Sun Valley Serenade." Seeing the actress Sonja Henie schuss the slopes of Bald Mountain, Laughlin resolved to do the same. But her love was first for ice skating, and between waitressing and then hosting, she earned the title of "skate bum."

But why leave now? "I’ve broken too many bones," she explains. But it ‘s not the ice rink that worries her, but the ice around town that will arrive with another winter, she told the newspaper.

Fried marmot disrupts life

STEAMBOAT SPRINGS, Colo. — A marmot made the ultimate sacrifice recently in Steamboat Springs. The critter got past a chain-link fence and a second barrier before climbing a transformer. There, it caused a high-voltage fuse to blow, causing a loss of power for several hours in portions of Steamboat. The community seems to have survived the interruption without major consequence, reports The Steamboat Pilot. As for the marmot’s life-transforming attraction to electricity, no theory was offered.

Where the money comes from

JACKSON HOLE, Wyo. — The election campaign season is well underway. Not quite half of all political campaign contributions for the November elections have already been made. And again, as in the past, Wyoming’s Teton County (i.e. Jackson Hole) heads the pack – not only among resort counties in the West, but the entire nation.

Jonathan Schecther, who crunches numbers for the Jackson Hole News & Guide, reports that Teton County residents have given $39.40 per capita. No. 2 in the nation is Colorado’s Pitkin County, where Aspen/Snowmass residents have given an average per capita of $29.01.

Far behind is Colorado’s Eagle County (Vail and Beaver Creek), followed by the usual suspects: Massachusset’s Nantucket, Utah’s Summit County (Park City), Idaho’s Blaine County (Sun Valley/Ketchum), Colorado’s San Miguel County (Telluride), Colorado’s Routt County (Steamboat), and then Colorado’s Summit County (Breckenridge, etc.)

Two growth paths, same staffing levels

MAMOTH LAKES, Calif. — The town of Mammoth Lakes has been trying to map the future, understanding that there are various paths that may lie ahead. But the difference between the strong growth and the lower growth scenarios is slight when tied to the town’s municipal staffing levels, reports The Sheet. One scenario sees 133 town employees, and the other 135 employees.

Idling allowed on breaks

PARK CITY, Utah — It’s a no-no in Park City for police officers to leave their cars idling while taking breaks. Not so in unincorporated Summit County, even if gas is more than $3 per gallon.

"When your husband’s kicking the crap out of you and you’re dialing 911 while he’s ripping the phone out of the wall, which happens pretty much on a weekly basis in Summit County… those are the people that don’t care that our vehicles idle," explained Dave Booth, the chief sheriff’s deputy.

"People want cops there now, they want them there three minutes ago," he went on to tell The Park Record.

High-tech gear further explains the policy. Police use lap-top computers to provide directions in the fast-growing valley. Leaving the computers on while shutting down the motor draws down car batteries. Booting up the computers takes 5 to 10 minutes.

Good luck and bad

EDWARDS, Colo. — Runoff from the biggest snow in nine years along the I-70 corridor has been moderately paced this year, with the peak runoff expected more or less on schedule, in late May or early June. Still, the water has been troubling.

The Vail Daily reports several mishaps involving rafters and one fatality. The victim, a 57-year-old Eagle Valley man, was rafting at Edwards when the boat flipped. Described as experienced, he was wearing a life vest but did not survive.

Meanwhile, several novices who did everything wrong survived with comparatively minor injuries. The trio of 19- and 20-year-olds had purchased a raft from Wal-Mart, but instead of investing in life vests, they bought a 12-pack for their journey on the Colorado River on a segment that has rapids of moderate Class III difficulty. The trio got pitched from the raft, lost most of their clothes to the waters, and one even blacked out. Miraculously, all survived.

A life remembered

TELLURIDE, Colo. — In mid-May, Jim Stewart was rafting a tributary of Idaho’s Salmon River when his boat capsized and he was killed by blunt trauma, from either a rock or the boat’s rowing frame.

A native of Nebraska, Stewart had had a broad and diverse background: education in music (specializing on the trombone) in Iowa, graduate studies at the Wharton School of Business, and then two decades in international investment banking before he moved to Telluride full time in 2000. While in Telluride, he was involved in many and varied pursuits, among them historic and architectural preservation.

One of his fellow board members, Chance Leoff, told The Telluride Watch that he finds it distasteful to exaggerate a person’s virtues after his or her death. "That won’t be necessary it his case," he said. "He really was an honorable, terrific guy. No one’s going to have to lie about him. It’s a big loss, it really is."

Mining icon may be saved

TELLURIDE, Colo. — In a sense, the history of mining is all around in Telluride. The magnificent homes and attractive storefronts are a testament to the wondrous mineral wealth that was extracted during the late 19 th century.

Still, a visitor to Telluride could be excused for not understanding the source of this Victorian architecture. The icons of the industrial activity are all outside of the town and even so steadily disappearing. To that end, Telluride and San Miguel County are debating what can be saved of the old Pandora Mill that remains at the end of the box-end canyon.

A permit was issued in 2003 for demolition of the old mill, which is a "very dangerous" place, in the words of a county commissioner, Art Goodtimes. It is home to some asbestos and showing the strains of eight decades of heavy snows.

But Johnnie Stevens, who grew up in a house next to the mill (his father was superintendent) before he eventually headed the ski area operations, is among those calling for its preservation. Just how it can be preserved, and more importantly, on whose dime, have yet to be worked out, reports The Telluride Watch. However, the Idarado Mining Co. remains agreeable to at least study the options.

First Lady gets whiff of LA

DURANGO, Colo. — U.S. First Lady Laura Bush was recently at Mesa Verde National Park, which is located in Colorado a day’s drive from the closest major city. Nonetheless, she got a whiff of several cities, notes the Durango Telegraph.

The air there, once considered among the cleanest in the nation, is now gunked up with pollutants from nearby coal-fired power plants as well as from pollution that has drifted in from Phoenix, Los Angles and other cities.

Ozone levels have also been rising at Mesa Verde, and the same is true at Idaho’s Craters of the Moon National Monument, Montana’s Glacier National Park, and Wyoming’s Yellowstone National Park.

Cops infiltrate kegger

JACKSON HOLE, Wyo. — On the eve of senior skip day, some 76 people gathered in a canyon in Jackson Hole for a kegger. Based on a tip from a parent, so did night-vision-goggled officers from the Jackson Police Department and the Wyoming Highway Patrol.

The Jackson Hole News & Guide reports that the cops administered Breathalyzer tests to the students, and some 51 minors tested positive. A number of them – those under 18 or who had readings of .08 or greater – were taken to jail.