Brent Pearson, chief financial officer and a principal for Resort Ventures West, built the First Tracks development, which in some ways has become the laboratory for Steamboat’s new affordable housing regulations.

Photo by Matt Stensland

Brent Pearson, chief financial officer and a principal for Resort Ventures West, built the First Tracks development, which in some ways has become the laboratory for Steamboat’s new affordable housing regulations.

First Tracks in Steamboat sell for far less than deed-restricted prices

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■ For more about available homes at First Tracks, part of Wildhorse Meadows, call sales representative Bobby Aldighieri at 970-846-1918 or go to www.wildhorsemeadows.com.

■ Learn about local housing opportunities and resources through the Yampa Valley Housing Authority at www.yvha.org.

Price points

First Tracks sales data illustrates the gap between actual sale prices and the deed-restricted prices set by city officials as benchmarks to determine developers' contributions to local affordable housing.

For 13 sales recorded through June 29, actual sale prices for First Tracks condominiums ranged from about $179,000 to more than $293,000. Affordable benchmark prices, though, ranged from about $188,000 to $298,000. One unit with a benchmark price of $298,200, for example, sold for $247,467.

The average benchmark price for those 13 First Tracks condos was about $281,000. The average sale price was about $248,000. The average disparity, or gap, between benchmark price and actual sale price was about $32,500 — in the negative.

In September, First Tracks developers Resort Ventures dropped the price on a few studio units by $30,000, to $119,000. The asking price for a pair of two-bedroom condos dropped from $295,000 to $249,000.

— Declining sale prices at First Tracks indicate that the national economy and housing market continue to do on their own what city officials tried to do legislatively several years ago: set affordable prices for some local homes.

First Tracks condominiums, the affordable housing component of Wildhorse Meadows, have sold on the open market for prices that, in aggregate, are about $600,000 less than deed-restricted prices set to determine developers’ contributions to local affordable housing. Last week, the Steamboat Springs City Council gave another concession to Wildhorse Meadows developers Resort Ventures West. That action all but eliminated the requirements placed on a First Tracks project that was a centerpiece of Steamboat Springs’ efforts several years ago to legislate affordable housing during a time of skyrocketing property values.

“We are gradually getting deeper and deeper in the hole from that item,” Brent Pearson, chief financial officer and a principal for Resort Ventures West, said about First Tracks. “Everything is selling for less and less and less.”

First Tracks consists of 47 condominiums in two buildings on the Wildhorse Meadows site, off Mount Werner Road near the base of Steamboat Ski Area. First Tracks can be accessed via Bangtail Way near the Tennis Center at Steamboat Springs. City planner Seth Lorson said the condos also account for the affordable housing obligations of One Steamboat Place, at the immediate ski base, and Trailhead Lodge on the Wildhorse Meadows site.

Pearson and Lorson presented data to City Council last week that showed in each sale of 18 First Tracks condos, as of June 29, the sale price was below a deed-restricted price established as a benchmark in May 2009, when the City Council significantly reduced First Tracks’ affordable housing obligations.

“They still have yet to sell any of their units for more than the deed-restricted price,” Lorson told the council.

Several First Tracks condos have sold for at least $50,000 less than the price city officials once determined “affordable.” The sales through June totaled about $423,000 less than those affordable benchmarks.

Pearson said Thursday that, with the most recent data, 23 First Tracks condos have sold, and the new below-benchmark total is about $600,000.

The City Council voted, 5-1, Tuesday to allow that below-benchmark amount to offset potential future First Tracks sales at prices above affordable benchmarks — should such sales occur.

Before Tuesday’s action, any First Tracks sale above a condo’s affordable benchmark price would have required a community housing payment, or fee in lieu, from Resort Ventures West.

The council’s vote Tuesday, which overturned the Steamboat Springs Planning Commission’s denial of Resort Ventures West’s request, removes the requirement for any fee-in-lieu payment until First Tracks sales total more above the benchmarks than below. In other words, until Resort Ventures West has made up the $600,000 — or whatever the below-benchmark total might be after additional sales — the company won’t be required to make a community housing payment.

“We’re better off having a partner than watching these guys go through something they can’t solve,” Councilman Walter Magill said. “Right now, there’s no call for affordable housing.”

Councilman Jon Quinn stepped down from Tuesday’s discussion and vote because of business conflicts. Councilwoman Meg Bentley cast the opposing vote in the 5-1 approval.

“I feel like this developer, as many other developers … they want to ride the rocket up, but when it runs out of steam, they want us to bail them out on the ride back down,” Bentley said.

“I just can’t go along with that.”

Housing history

Development of Wildhorse Meadows coincided, chronologically, with previous City Council efforts in 2006 and 2007 to establish Steamboat’s first affordable housing regulations.

Those efforts were spurred by projected significant development at the base of Steamboat Ski Area, with large projects including One Steamboat Place and — it was thought at the time — redevelopment of Ski Time Square on the immediate horizon.

First Tracks was viewed as a major method of securing housing for the local work force amid the high-end development projects, and in some ways became the laboratory for Steamboat’s new affordable housing regulations.

“You’ve treated us differently from the get-go,” Pearson told the City Council last week. “We’ve basically been the test for the city of Steamboat Springs during this period of time.”

Sales of First Tracks units were slow, especially after the recession’s full force struck in 2008. Pearson said it became increasingly difficult to find buyers who met criteria for deed restrictions that weighed factors including income level and assets.

Hence the changes in May 2009, when the council removed deed restrictions from all First Tracks condos.

“The structure as it was agreed upon in the meeting of May 2009, when (Resort Ventures West) had restructured their entire community housing plan, was that each unit they sold they could sell at market rate, with no restriction,” Lorson said.

Instead, the City Council said at that time, Resort Ventures West would make fee-in-lieu payments according to how actual sale prices compared with the affordable benchmark prices.

Under the new agreement, Resort Ventures West would pay a maximum fee of about $35,000 for any sale at a price above the affordable benchmark.

Say, for example, that benchmark was $100,000 for a First Tracks condo.

If the condo sold for $150,000, the fee-in-lieu would be the maximum of about $35,000. If it sold for $115,000, or $15,000 more than the benchmark, the fee would be $15,000.

If the condo sold for $95,000, or anything less than the benchmark, the fee would be zero.

To date, no First Tracks unit has sold above its benchmark.

The council’s action Tuesday means any fee-in-lieu contribution from First Tracks is unlikely, given the current $600,000 gap.

“I don’t think anybody expected the units would actually sell below the affordable housing set price,” City Manager Jon Roberts said. “I don’t think anybody foresaw that scenario coming about.”

Pearson noted that a voluntary transfer fee remains, in perpetuity, on sales of future development at the rest of Wildhorse Meadows. Those fees would benefit local affordable housing efforts.

He said plans could move forward in spring for a Wildhorse Meadows development phase that could include single-family homes, totaling as much as 60,000 square feet, on the west-facing hillside below Mount Werner Road.

For Bentley, the transfer fee is not enough. She called Tuesday’s vote “a bailout here, on a local level,” and noted the City Coun­­cil’s compromise efforts in 2009.

“I feel like this is a sell-out to the community that was promised community housing,” she said.

Comments

beentheredonethat 3 years, 4 months ago

the city has no business trying to create "affordable" housing. let the market regulate prices. developers get to keep any profit they can make, but developers also take whatever losses occur. simple.

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Fred Duckels 3 years, 4 months ago

Incompetence abounds in this insane idea. The recent past has been a tempting proving ground for inexperienced novices looking to save humanity. In my lifetime we have lived without government assistance for a long time. Most were too proud to accept, even if provided. We are each given life and it is not wise to pull the cart of others, in the process we rob them of their chance to rise on their own. Shaking down those that we assume are getting ahead of us, is tempting, and elevates our image. I can see requiring concessions, but let's use the money for something where we get more bang for the buck. It is very easy to use the AH banter to cover the shakedown, but we will forever tinkering to deal with this knee jerk idea. It sems that now the taxpayers may be asked to pick up the pieces to sustain this folly, count me out. We have had our dose of this insanity on the national scale and must we continue down the road? It's meat and taters time, no catsup.

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steamboatjody 3 years, 4 months ago

Thanks for keeping it real, Meg, and actually voting for your constituents. How is it that you are the ONLY City Council member who is seeing this clearly and not bailing out the developer? HELLO!!! There's a recession out there and ALL the real estate prices have gone down, you aren't the only ones suffering Resort Ventures West you just keep expecting the City to ease your pain which is ridiculous!!!!

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