Tuesday, May 19, 2009

Tamarack back from the dead?

Posted By on Tue, May 19, 2009 at 10:50 PM

Don’t sell the skis just yet.

Tamarack Resort may have a buyer, principal owner Jean-Pierre Boespflug told the Idaho Land Board earlier today.

Boespflug notified the board that it could be contacted by an interested party within the next 60 days, though he declined to name the potential buyer, citing a confidentiality agreement. He urged the board to be ready to expedite the buyer’s requests for data or other information that would aid in the sale, so that the economy and unemployment rates in Valley County could begin to mend.

“Me and my partner, we are wiped out… We want to see the community survive, to see some kind of legacy for Idaho. What matters is that these people are not in a situation again where they have something very difficult to endure,” he said, referring to the way Valley County’s economy tanked in the early 90s when the logging industry largely pulled out of the area.

The Land Board is one of Tamarack’s major stakeholders, since the resort leases a large chunk of state land for $250,000 a year. The next payment is not due until January of 2010. Boespflug said he hopes the resort will be enjoying a revival by then.

“This process is still reversible,” he told the board. “Dismantlement has not occurred. We are essentially in the last 45 to 60 days where something can be done. The solution is to find a buyer with the expertise and the cash to be able to deal with a property like this.”

Tamarack Resort opened in 2004 to widespread acclaim and drastically raised Valley County’s employment by a third between 2003 and 2007. However, in 2008 the resort began sliding towards financial ruin when the owners failed to make loan payments to Credit Suisse, which is now owed about $275 million. Plagued by mounting debt and foreclosure proceedings, Tamarack officially closed this March, and Valley County unemployment rates jumped to 10.2 percent last November.

Boespflug and his partner, Alfredo Miguel-Afif, had been trying to secure a buyer for the resort even before a court ordered a receiver to take over management last October. Boespflug hinted that this latest promise of a buyer could actually be successful thanks to a court-ordered mediation that took place last week between six Credit Suisse representatives and three members of the Tamarack board of directors.

“The ray of hope is that the landowners and the owners are finally cooperating with a set of terms... The buyers, who have been hesitating before they commit to a final offer, are finally showing some interest,” he said.

There was a dark side to Boespflug’s sunny outlook, however.

“The issue is that this offer is going to be pennies on the dollar,” he said, though he declined to quantify how few those pennies might be when pressed by Gov. C. L. “Butch” Otter. Boespflug also admitted that a “short sale” or filing for Chapter 11 bankruptcy were not yet out of the picture.

Otter acknowledged that he was concerned about the mystery buyer and about how much money the Land Board could lose in a renegotiation.

“I think to be fair to the board and allow us to fulfill our Constitutional responsibility, we need to have some sense about how much pain you’re talking about,” Otter told Boespflug. “We’re going to have to decide credit worthiness of this white knight.”

Secretary of State Ben Ysursa expressed condolences to Boespflug and wished him luck in the negotiations.

“I know this is a difficult time for you,” he told Boespflug. “Your passion and dedication on this project has always been there. Things obviously went sour.”

However, Ysursa noted that although everyone wanted the project to succeed, the Land Board still has to “protect its interests.” The Land Board, made up of the state’s five Constitutional officers, is obligated to maximize returns on state endowment lands for the benefit of Idaho’s public learning institutions and other beneficiaries.

In the end, Boespflug offered hope without specifics.

“I want you to know that it is coming,” he said. “This is a very high stakes claim. It’s time to work hard and it’s time to settle things in a positive direction in the next 45 days.”


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