The successful auction of the remaining condominium shares at the Steamboat Grand Resort Hotel and Conference Center is good news, not only for the Grand's owners but also for the community.
More than 30 whole-ownership units and more than 200 one-eighth share units were sold Saturday. Prices ranged from $14,500 for a one-eighth share of a one-bedroom unit to $680,000 for ownership of the penthouse suite.
The auction means the Grand's owners -- Grand Summit Resort Properties -- can pay off debt and that the hotel can finally start collecting assessment fees on 100 percent of the units. For the larger community, the auction means the Grand finally can shed the albatross label and become what it was envisioned to be when it was built -- a showpiece at the base of our ski area.
Construction began on the Grand in summer 1998, and after being delayed on several occasions, Steamboat's largest hotel opened in September 2000. It cost $80 million at the time it was built.
Those in the development industry like to say success hinges on bringing the right product to market at the right time. The Grand is certainly a first-rate product -- it is AAA's only Four Diamond property in the area. But hindsight shows the model for selling the Grand may have been the wrong product at the wrong time. Sales of the fractional shares never lived up to expectations, and the economy soured not long after the Grand opened. The economic fallout of the Sept. 11, 2001, terrorist attacks lasted two years -- it certainly was not the ideal time to be marketing luxury condominium shares.
Retiring the debt on the Grand hinged on selling the units, and when sales lagged year after year, the debt took its toll on American Skiing Co. ASC reported missing deadlines to make debt payments and restructured loans with its creditors. Eventually, ASC spun off Grand Summit Resort Properties to absorb the problematic Grand hotels in Steamboat and Park City, Utah -- a move that presumably allowed ASC to focus on running ski areas.
But the shadow of the Steamboat Grand always has loomed large over ASC and the ski area. Saturday's auction was the best way to get out from under that cloud.
The auction may even have exceeded expectations. Interest certainly was strong, which sends the right message for those contemplating investment at the base of the mountain now that an urban renewal authority has been created in the area.
Selling out the units will drive occupancy at the Grand. And the auction will allow management to focus on operating a first-class hotel instead of competing with its condominium owners on sales of units.
The Steamboat Grand has been a significant asset to the community from the moment it opened. It's a first-class property for guests, and it's an ideal venue for any number of functions including concerts, fundraisers, banquets and conventions. Simply put, Steamboat would be a lesser resort without the Grand.
But the facility's unsold shares have lingered like an asterisk next to the resort hotel's name. Saturday's auction should erase that asterisk once and for all. That's great news for anyone hoping to see our resort community prosper.