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Tamarack owners file for bankruptcy.
http://www.idahostat...ory/300667.html

The majority owners of Tamarack Resort have filed for bankruptcy to avoid foreclosure by Credit Suisse, which is owed more than $262 million from loans the resort took out for construction.
Tamarack CEO Jean-Pierre Boespflug said Tuesday that they had to file to protect ownership of the ski and golf resort near Donnelly after a new $118 million loan fell through because of recent banking scandals in France.

"The main thing to understand is that it's really not Tamarack Resort filing," Boespflug said in an interview Tuesday night. "Tamarack itself is not affected, and it's business as usual."

Boespflug's company, Cross Atlantic Real Estate, owns 27 percent of the resort and VPG Investments owns 48 percent.

VPG is owned by Tamarack co-founder Alfredo Miguel Afif of Mexico. Cross Atlantic and VPG each filed for Chapter 11 bankruptcy protection Friday in federal court in Boise.

Companies often file Chapter 11 bankruptcies as a way to reorganize because of ongoing financial difficulties. A filing doesn't always mean that creditors won't receive payment. To put it simply, filing Chapter 11 gives company breathing room to regroup rather than having to fight off creditors.

Often in a Chapter 11 bankruptcy, only secured creditors receive any type of payment in the reorganization plan, which must first be approved by the court.

But the bankruptcy filings by Boespflug and Afif indicated that there will be money available for unsecured creditors as well, but there were no specifics given.

Credit Suisse is listed as the top creditor in the bankruptcy filing, but five other creditors are owed a total of more than $9 million, according to bankruptcy filing.

Other high-dollar debts include $4.1 million to a Houston-based company called Rotorwing and $3.2 million to Hopkins Loan Services in Meridian. The filing also lists more than $2 million owed to a bank in Mexico.

Boespflug said that since new financing is not readily available, they couldn't risk foreclosure proceedings by creditors, especially Cayman Islands-based Credit Suisse. If Tamarack defaults on the loan, Credit Suisse would gain control of the resort because Boespflug and Afif used their percentage of the ownership as collateral.

They said part of their financial problems stem from a banking scandal that has hit the French financial markets.

Societe Generale had agreed to provide a $118 million loan to the resort that would have been available in time to avoid any possible foreclosure by creditors.

But Societe Generale withdrew its commitment after the bank suffered $7 billion in unauthorized trading losses in January because of a rogue securities trader.

Boespflug called the bankruptcy filing a "technical maneuver" to protect the company while it seeks new financing.

On Monday, the company released a statement that because of its difficulty finding financing, it had to slow down commercial and residential construction at the resort and use the resort's existing money wisely.

Boespflug said Tuesday night that he's optimistic that the resort can find a new source of financing.

"There are other banks interested," he said. He declined to name those banks.

Financial problems at the resort have already resulted in employee layoffs at both the resort and at its Boise office, but the company has declined to elaborate on any specific numbers.

Despite the financing troubles, Boespflug said the resort is experiencing its best season to date, thanks to the abundant snowfall so far this season. Revenues and skier numbers are all exceeding expectations, he said.

Construction on Tamarack Resort began in 2003, and it opened for its first skiing season in December 2004.

Tamarack has been highly touted since its 2004 opening. It has been featured in major newspapers, including USA Today and the New York Times, as well as dozens of ski and travel journals.

In the summer of 2005, President Bush visited Tamarack at the invitation of then Gov. Dirk Kempthorne.

Sales of Tamarack's luxury homes have been well received. Since January 2004, the resort has sold eight real estate offerings for more than $500 million.

In its last yearly earnings reported in June for the year ending April 30, the resort listed nearly $93 million in revenue, including $76.3 million in real estate sales.

Just business as usual.

I would think something is going on for them to do that, or does every ski area do that as a way to help pay off some debts?

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Reading the article that was posted, it isn't Tamarack that is filing, according to the quote above. This is the owners of the stock in the corporation protecting themselves from having their ownership taken away. It sounds as if it is no different from any other investor filing for bankruptcy protection, such as a guy who owns some shares of Pepsi. It doesn't mean that Pepsi is in trouble.

Except they own 75% of it and Tamarack's CEO owns one of them.

zeedotcom, on Feb 21 2008, 05:13 PM, said:

Do not be fooled by smoke and mirrors . the normal operation will not be affected because Tamarack resort LLC ,the operating entity has no assets It does not need ch 11 protection because it has very little to lose . those owners of the stock own all of the capital assets at the resort ,they filed ch 11 to protect the assets from being sold or repossessed. very normal business practices these days

Looks like skiing may be affected now, ouch.

CREDIT SUISSE SUES TAMARACK RESORT OVER DEBT

SAM Magazine—Boise, Idaho, Mar. 14, 2008—Investment bank Credit Suisse is suing Tamarack Resort, claiming the resort has failed to repay $262 million in debt and interest. The company is asking the court to foreclose on the property an award it to Credit Suisse; in anticipation of just such a move, Tamarack filed for Chapter 11 bankruptcy protection a few weeks ago.

New West magazine reports that, in a statement, Tamarack CEO Jean-Pierre Boespflug said the bankruptcy filing will give the resort time to “either refinance, add a partner with additional financing, or sell the resort to a suitable buyer capable of managing the asset with the continued interest of the community in mind.” This was the first time that the sale of the resort has been mentioned as one possible outcome of Tamarack’s current liquidity crisis.

Resort operations will continue, public relations representative Jessica Flynn said, though services could be cut back in the off-peak winter and summer seasons.

Skier, on Mar 14 2008, 04:56 PM, said:

Massive lay offs are occuring at Tamarack .Just busines as usual for a ski area at the end of the season.

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I can assure you that the lifts are very well maintained to this point. Our track record of .02% downtime for the lifts this year is proof of that.

I just noticed that Tamarack has cut operations to only 2 lifts, with the beginner lift only open half days on the weekends. They must be getting desperate to save some cash!

It could be normal for this time of the season. Mt. Bachelor has cut operations and will soon be closing the Pine Marten and Northwest Express lifts for the season and only running Sunrise and Summit Express until the season closes.

Tamarack will shut down Boise office
Developers of the troubled resort take action to reduce their expenses. Twelve employees will be laid off.



By Ken Dey - kdey@idahostatesman.com
Edition Date: 04/17/08


Tamarack Resort is closing its Boise offices this week.
Tamarack CEO Jean-Pierre Boespflug told the Idaho Statesman that the move will affect 20 employees. Eight employees will continue to work for the resort remotely or from their homes. The rest will be laid off.

Boespflug said the resort decided to close the Boise office to further reduce expenses and to avoid cutbacks at the resort in Donnelly.

This is the latest blow to the financially strapped resort.

The Swiss investment bank Credit Suisse has a pending legal action asking the 4th District Court in Valley County for permission to foreclose on the resort to reclaim more than $260 million owed to the bank, including a $250 million in principal and about $10 million in interest.

In late February, Boespflug and Tamarack investor Alfredo Miguel Afif filed for bankruptcy under the names of their companies to keep Credit Suisse from foreclosing after the resort failed to stay current on loan payments.

The two had pledged their majority ownership as collateral.

Boespflug said he and Afif had no choice but to file for bankruptcy after the French bank Societe Generale withdrew a $118 million construction loan for the resort in late January. That occurred after a trader at the bank in Paris lost $7 billion in a banking scandal.

Boespflug said the resort continues its efforts to find new financing.

But the legal actions are mounting. Other actions include:

• Credit Suisse has filed a second lawsuit for unspecified damages aimed at Boespflug and Afif for breaching a written agreement included as a requirement for the loan.

• Dozens of contractors have filed more than $13 million in liens against the resort for unpaid debt.

• In March, the the resort's former vice president of real estate sales filed a lawsuit asking for more than $1 million for unpaid severance and real estate commissions.

I think the resort is going under. Yet someone will buy it later and make their million at it.

I personally believe that Tamarack's future is unknown. It's going to be extremely expensive to build a resort around the image that Tamarack is trying to appeal to and target. One key problem is that the entire project is forecasted around $400 million to complete and ski resorts are considered high risk investments these days because of their uncertainty of being successful. Another problem is that it takes a considerable amount of time to build a brand image and loyalty, which hopefully contribute to a profitable customer base. However, Tamarack is located in the middle of no where and therefore it's target market can probably only ski there a few times per year. Plus, Tamarack's target market is probably already very brand loyal to other resorts like Deer Valley, Beaver Creek and the Yellowstone Club. It's these reason why I believe Tamarack will have a hard time succeeding, unless it wants to position itself more as a locals mountain, with some high class aspects.

Telluride has some attributes that are similar to Tamarack and it has also experienced a troubled financial past and still does today in some aspects.

Good insight, Cameron.

Dino

location, location, location....a huge factor in a resort's success. places that do not have a large population base or major airport nearby must offer something very special to compensate. I am sure this down turn in the economy isn't helping (and most likely is the root cause) but isn't this what killed Stagecoach Ski Area back in the 1970's and probably numerous other ski areas over the years. History tends to repeat...

The management at Stagecoach is what killed it. It focused on building condos instead of concentrating on building resort infrastructure like a day lodge. Ski resorts actually do quite well during recessions because people can't afford to travel overseas so they stay close to home and support the local economy.

However, Tamarack is trying to appeal to the upper class, yet there are no hotels with this type of status currently in the area.

Kicking Horse is having major issues for the same reasons. I suspect Revelstoke will have the same problems as well.

well, not knowing too much about Tamarak, isn't that what they're doing too? I know they've built it up quite a bit and quickly. I'm sure that is contributing to their problems.