Monday, July 5, 2010

The Yellowstone Club – Snowboarding for the super-rich, everyone else not welcome.

 
Previously in the Last Resorts articles we’ve taken a look at some snowboard destinations that you aren’t likely to get a chance to try because they’re a bit too warm, too remote or too warlike. This week’s resort however is lovely, it’s easy to get to, beautifully maintained and there are no lift queues, the only drawback is the price…It costs a cool $250,000 to join. Welcome to the Yellowstone Club…


The Yellowstone Club was set-up by timber magnate Tim Blixseth and his wife Edra in 1997 as "The World's Only Private Ski and Golf Community". They set about encouraging a number of incredibly wealthy folks to invest in the resort. You have to be incredibly wealthy because to become a member you need to have at least $3 million in assets, you need to stump up the $250,000 membership fee, you’ll need to build yourself a house which will cost between $5million and $35million and then you’ll have to fork out the annual charges of $20,000. Over the years they built up a membership of close to 350 people including the likes of Bill Gates, Dan Quayle, Tour de France winner Greg LeMond and ski film legend Warren Miller and the club itself amassed over $600 in assets.

Things were going so well the Blixseth’s decided to start investing in a series of other clubs for the super-rich around the world and they were planning to build the world’s most expensive house at the Yellowstone Club for a cool $155 million. 
Possible design

But underneath the fa├žade things were not all that kosher. Tim Blixseth was well known as someone who had made millions of dollars in the timber business, who had then gone bankrupt, and had managed to strike it rich again to become a billionaire. After his experience of bankruptcy he was quoted as saying, “I swore I was going to exclusively collect assets and not liabilities for the rest of my life. I swore never to take gambles I couldn’t back up, or that I couldn’t afford to lose. And, I’ve stuck with that ever since.” He lied.

Back in 2005 the Yellowstone Club was doing very well, but to invest in his world conquering plans Tim Blixseth needed a loan. Back in the heady days of 2005 of course, loans were a little too easy to get hold of. He approached Credit Suisse for $150 million, but the bank convinced him to take more, and he did, finally agreeing on a $375 million loan. And if that sounds a bit flippant when dealing with huge sums of money then this quote from The Atlantic will give you an idea of how much thought went into the deal… 

When he and Jeff Barcy, the lead Credit Suisse banker, couldn’t agree on the fee, they flipped a coin. (Blixseth won, and Barcy got 2 percent instead of 3 percent.) Appraisals? Cash-flow projections? The ability of the borrower to re-pay? Ah, not to worry, these small details didn’t require much attention, because Credit Suisse didn’t have any money at risk anyway. The loan would be packaged and sold as part of so-called collateralized loan obligations, putting possible future problems on the shoulders of institutional investors like hedge funds and pension funds.

And the first thing the Blixseth’s did was siphon $209 million of it into their personal accounts.
Happy days

---Video Interlude--- 
They have a pond skimming event at the Yellowstone Club, although there’s not much of a crowd. No idea why the whole video is in reverse but its strangely mesmerizing to watch: 
---Video Interlude Ends---

Unfortunately all this dodgy dealing started to bite back and things started to go a bit askew in 2008. It was, to put it lightly, not a good time to have a stonking $375 million loan to try and pay back. The finances of the Yellowstone Club were shot and people were noticing including Greg LeMond who started legal action against the Blixseth’s. Within a few months the house of cards had fallen, the Blixseth’s had to file for bankruptcy and their marriage fell apart very publically and dramatically.

 “I would rather feel the cold steel of a revolver in the roof of my mouth and pull the trigger than to ever think about living a day with that man again,” Ms. Blixseth said in this article from the New York Times. She doesn’t seen to be doing so badly all things considered though as she was pottering around one of her other mansions during that interview. 

All this controversy was lapped up by the press and the public who reveled in the downfall of the Blixeth’s and their gated community. In one article Warren Miller waded into the discussion by trying the rebrand the super-rich people of Yellowstone club as “economically stratified”. The article he wrote is gibberish but the comments section is really active and worth a look because a few members of the club get.
Tim Blixseth back when he was economically stratified

Despite the issues of the Blixseth’s and the surrounding press coverage the club has managed to survive and it is now under new management. Under chapter 11 bankruptcy the Yellowstone club was sold to the private equity firm of one of its members for $115 million. Just a year previously, that same buyer, CrossHarbor Capital Partners, had been willing to pay $400 million for the club. Ouch.

It’s worth mentioning though that the $155 million house didn’t get built but if you fancy buying a $2 million driveway there is now one available.

What is the snowboarding like?

It’s very nice a quiet. The busiest days see a maximum of 150 people on the mountain. They will open the resort including all of the lifts and the three restaurants even if there is just one person on the mountain. And the upshot of that is that you get powder runs for days after a snowfall. 

Look...Justin Timberlake and Travis Rice have been there.
Mark Carter, Travis Rice, Warren Miller, Justin Timberlake and Scott Schmidt. Source

And you get quite a lot of mountain to cover. There are 75 ski runs with poncy names like “Learjet Glades” and “Ebitda”. Former pro-skier Martin Bell visited in 2007 and described the place: 
Having originally heard about the place, I had envisaged a 'golf course on a slope' - a few blue and green runs meandering through a luxury real estate development. But Pioneer Peak, where most of the club's skiing is situated, is a real mountain. It tops out at just over 3,000m, with a vertical drop of 823m - quite respectable for a North American ski area - more than well-known resorts such as Alta or Alpine Meadows. Off the top ridge there's a choice of several steep chutes above the tree line. Lower down the mountain there are groomed autobahns, and over the back are powdery glades, which is where I discovered that there was no need to ski too deep into the forest. The total skiable terrain extends over 900 hectares, making it larger than some top-level resorts such as Beaver Creek, Deer Valley or Telluride. It doesn't stop there. Yellowstone Club members can ski, via a connector chairlift, to the massive linked ski area of Big Sky and Moonlight Basin.

Snowboarding in an empty resort surrounded by mountain huts filled with candy, it's Hansel and Gretel's wet dreams…

The connected area of Yellowstone, Big Sky and Moonlight basin make this the largest skiable area in the US. Of course that’s only for club members; the folks from Big Sky or Moonlight Basin don’t get to ride in the Yellowstone Club areas. That’s got to be really galling to not be allowed to ride in one part of the area because of you are not rich enough, although from this Independent article it seems you can get through security if you are either a journalist or you're dressed in a gorilla suit: 

Is there an easy way just to access the club, and have the privilege of skiing around Lone Mountain from Yellowstone Club via Big Sky to Moonlight Basin? Yes, there is. The club polices its community well, and boasts a "vice-president of security and director of privacy" on its management team. But on occasion people do get under the wire, among them a writer for US Skiing magazine, who skied in wearing a gorilla suit. Which is odd, as in my experience a journalist who asks politely is invited through the club's imposing gatehouse and offered dinner and a bed for the night before skiing the slopes. That's how, for one day in mid-January, I joined the privileged few.

See if you could get a job in the Yellowstone Club’s security team. There’s a guy dressed in a gorilla suit in this shot can you spot him?
Only took me 5 minutes to spot him.

Let’s check out one last video of the snowboarding you are missing. Is there anything stranger than a bunch of rich kids falling over every obstacle they can find on their private mountain to a gangster rap soundtrack?

One word of warning though, before you get too envious. I mentioned at the start of the article that the place is easy to get to. For most of the members it’s especially easy because they tend to fly in by private jet, which sounds good but it’s a risky business. In March 2009, 14 people died in a plane crash when they were on their way to resort. Rather conveniently though, they crashed into the local cemetery.
I shit you not, this actually happened

Anyway if you can get there without dying, you have more money than Scrooge McDuck, and your not afraid to have most of the world hate you, then this is the resort for you. For those of you who are not economically stratified enough to join there is however another way…. To support the needs of the 340 members they need over 600 employees, so if you are looking for a job for the season I recon this is worth a shot. The tips should be good.



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6 comments:

  1. You should read this article.

    http://www.bozemantalks.com/2010/07/25/the-yellowstone-club-strikes-out-again

    You can only get a job there if you are "white, f*!@able and friendly" according to one senior manager at the Yellowstone. The club may have sold but employmenet discrimination, theft, wrongful discharges, etc. are rampant as the new management creates an excusively "all white work staff" for economic stratified, who by the way NEVER tip up there! I worked here, and the skiing was great, but not worth your soul.

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  2. Obviously you don't deserve to work there. If you actually took a look at the bills that the members receive there is a "service charge" topped off at 25%. That goes DIRECTLY to the employee who serviced them. That's a better tip then the average American gives elsewhere. Sorry but with that attitude it is no wonder the club didn't want you there.

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  3. Besides your being poorly informed [fact], you may be as ignorant as you like and run your mouth all you want - but cracking a joke about many members of two different families perishing in a plane crash - is hideous. I hope somehow, someday, I meet you. Punks like you deserve to be embarrassed, or just plain knocked down!

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    Replies
    1. That's a unique combination of claiming the moral upper ground and threatening violence

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  4. Yc is a great place to work and visit. The members may be rich as hell in many cases but for the most part they are polite and respectful to the staff that serves them. Most of the time it's like working in any other service job, only the atmosphere is plusher and the drinks are all top shelf. Oh ya... And the skiing is wonderful, even for employees that get to ski the mountain twice a month. Cheers!

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  5. yeah, i worked there too, it was the S@#T! sick place to work, mostly awesome staff of people who i made lots of good friends from, sick mountain, free season pass to big sky... management was always super awesome to me and I made some serious cash money... people who complain about the yc are just a bunch of wanna be big sky locals who should just go back and complain about living in minnesota instead.

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