Jay Peak, VT Opens New $5-Million Development | Resort Will be For Sale in May to Repay Defrauded Investors

Steven Agar | | Industry NewsIndustry News
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Jay Peak, VT. Credit: sherwoodrealestate.com

The ribbon was cut Wednesday afternoon on the last major development at Jay Peak, coming just a few months before the resort is expected to hit the market in May in search of a buyer, reports vtdigger.org.

This is good news for the 800-plus EB-5 investors who were defrauded in a massive Northeast Kingdom redevelopment scheme and will likely get most of their money back with the sale of Jay Peak as well as the nearby Burke Mountain ski area and other properties.

Gov. Phil Scott was at Jay Peak on Wednesday to mark the official opening of the latest development project to be completed at the resort, the Clips & Reels Recreation Center, a roughly $5 million movie house, wall-climbing center and arcade that is part of the resort’s Stateside project.

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Michael Goldberg, the court-appointed receiver in the EB-5 fraud case, speaks at a Statehouse news conference. Credit: Michael Dougherty/VTDigger

Michael Goldberg, the court-appointed receiver for Jay Peak Resort, Burke Mountain Resort, and properties in Newport, says the recent Securities and Exchange Commission settlement with the two men who perpetrated the Ponzi-like fraud, Miami businessman Ariel Quiros and former Jay Peak CEO Bill Stenger, has cleared the way for the sale of both properties. In the settlement with the SEC, Quiros agreed to surrender properties he had totaling more than $81 million, including his ownership stake in both Jay Peak and Burke Mountain.

Since Goldberg became the receiver in April 2016, he has made a concerted effort to restore fiscal stability to the two mountains. He has kept the resorts operating through the receivership period and has recovered enough money from lawsuits against Citibank, Raymond James Financial, and other sources to pay off debts and make repairs. The half-finished condo complex at Stateside was completed, a faulty tram was repaired to the tune of $5.1 million, vendors have been repaid an outstanding $5 million and another $5 million debt to contractors has been settled.

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Jay Peak, VT. Credit: panoramic.com

In addition, Goldberg has made investments in snowmaking, landscaping, soccer and lacrosse fields and a new theater at Jay Peak. He installed a new lift and snowmaking equipment at Burke.

The resale value of the resorts is a big unknown at this point, but Goldberg anticipates a vigorous sales process with private equity buyers and bids from resort, timeshare and hotel companies. Goldberg expects to see “a well-attended sales process with a lot of rich people and entities — it will go for the highest possible price.”

 


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