Mammoth Real Estate Q&A — A Journey Through Dysfunction?

This Real Estate Q&A appears in the 4th of July Weekend 2021 issue of The Sheet.

 

Though we travel the world over to find the beautiful, we must carry it with us or we find it not.” 

Ralph Waldo Emerson

Q: We visited ML in 1997, bought property in 1999, built a house in 2002, moved into it 2004. It didn’t take long to realize a resort is not a normal town. We’ve learned to roll with punches of a resort town…but has ours always been this dysfunctional? Old timers tell me yes. Is there a secret as to why our town is so dysfunctional? Is this typical of resort towns?

A: This reader has persisted for months that I answer this question, so here goes my best attempt…..In the past when people did stupid things around here I was often reminded that we live in a “low oxygen” environment in Mammoth. The high elevation and thin air not only impacts our visitors and second homeowners, but even those of us who have been around long enough to truly acclimate (maybe the people in Bishop really are smarter?). I’ve come to believe there is something to this, but….

Mammoth Lakes is the only resort town I’ve ever lived in, so I can only speak for it. Dysfunction may be in the eye of the beholder. And others may argue that dysfunction is everywhere these days, so what’s the problem? Since this is a real estate column I’m interpreting your concept of “dysfunction” as the oddly-planned hodgepodge of development and the erratic boom/bust push from developers. And maybe the unfinished and rather unpolished character too (weren’t you told that Mammoth was going to be the next Aspen, or Whistler?) So let’s take a look at some factors that make Mammoth what it is, and why some believe it is a byproduct of our dysfunction.

First, the underlying attraction to living in a community like Mammoth is the natural beauty, the changing seasons, the open space, and the bounty of recreational opportunities. But small town resort living isn’t for everybody. Many years ago I coined the marketing phrase “Small town, Big playground.” It describes the Mammoth region well. Over my four decades of living here I’ve seen many “residents” come and go. One of the small dysfunctions is that Mammoth is inherently a transient place; visitors and second homeowners coming and going, seasonal workers, temporary “escapees” and others who “try it out for a few years.” Many of those who left after some time simply didn’t find enough “action” or cultural stimulation here. Others couldn’t deal with the winters. Others found difficult economics.

One of the true “dysfunctions” that warps this community (and likely other resort areas) is people’s priorities. Many want to focus on recreation including a variety of extreme sports, and of course golf. This focus is at a very high level in the eastern Sierra. Whether you are a well-taken-care-of trust funder or an impoverished “bum”, the priority of play often displaces what other “normal” people consider as responsibilities. This can include showing up for a job or even having a job. Or paying rent. Or a whole host of other things “responsible” people do. And forget anything that would include volunteerism or civic mindedness. Remember; Mammoth –– Just For Fun. When this is everybody’s priority, some dysfunction is sure to follow.

This priority of play can be true in the real estate industry. Over the years I’ve managed dozens of agents. The challenge of focusing them on work while they wanted to be out skiing, snowmobiling and playing golf was incredibly frustrating. All while I wanted to be out there playing too. Talk about dysfunction. It is amazing this community works as well as it does. Thankfully we have enough citizenry who can find some balance. This priority of play can happen to anyone including government employees and officials and even the local doctors and health care practitioners. For the most part it is why people live here (and come here) in the first place. This is the land of play-a-holics. Maybe we should have an Anonymous group for this?

To make matters worse, the play priority exists along side of our challenging economic environment. Mammoth is a seasonal economy. It isn’t as seasonal as it was decades ago when summer was dead, but it still ebbs and flows. Add to this the higher costs of living in this isolated place including the ever increasing rental and housing related expenses. The snow removal alone is expensive. Snow removal can be an impatient master; when it needs to get done, it needs to get done. All at the same time people are addicted to playing in the fresh snow.

The challenging economics and harsh winters impact the real estate and development sector. Many, many projects get proposed, even down to expensive plans and the environmental work, but never get developed. It is a recurring theme here in Mammoth for decades. The cost estimates simply come in too high. And the revenue projections come in too low. Hopefully the cost overruns at our new ice rink don’t shock us. Or the mid-term maintenance costs. Regulation (or over regulation) by the State of California and the Town of Mammoth Lakes don’t help either at bringing these development costs down to a viable level. And we have snow-load and seismic engineering requirements that also add to increased construction cost.

Real estate development in Mammoth, and ultimately the refinement of the resort, has also been more seriously impacted by the vagaries of the macro economic environment. It too is a recurring theme. Months before Covid hit there were several small and large Village hotel developments that were well into the planning phase and being paraded in front of the public. And there is the recently approved and beautiful hotel redevelopment plan for the Sierra Center mall. Even with plenty of cash sloshing around the economic system, where is the progress on these projects? Forget it. 

Escalating construction costs are now making them even less viable. Consultants tell us we are substantially short “hot beds” here in Mammoth. This could be driving the increased values of existing condo/STR properties here in Mammoth. Covid and the STR evolution have moved us away from condo hotel properties, at least for now. The guests are preferring the reduced personal contact of STR properties. How things change.  

One of the classic stories of development struggle here in Mammoth is the the 355 acre Snowcreek Resort. Tom Dempsey negotiated a 25-year development agreement with Mono County in the late 1970s. He thought this would be more than enough time to complete the resort as planned. Within a few short years of starting development he had the first three phases (316 units) completed, had the Athletic Cub completed and had “storyboards” of the Snowcreek Ski Area and the Snowcreek Village at the base of the Sherwin Range. Imagine how that would have changed Mammoth?

But earthquakes, volcano hyperbole and recession put the brakes on development. In the mid-1980s they struggled to get Phase IV completed (138 units). (Does anybody remember the massive fire that took place on the site during the framing stage?) The 297 units in Phase V were started in 1989 but it wasn’t built-out until the early 2000s. The 1990s were an economic struggle here in Mammoth and Dempsey built small clusters of units just to keep his core construction crew working and to show “progress.” He got the Ski Area approved in 1990 and then the approval was rescinded. It took 25 years to complete the land trade for the back nine of the golf course, and the process outlived him. The 25-year development agreement had to be renegotiated. It’s one of the reasons the Aspen Village workforce housing project sits along Old Mammoth Road adjacent to the Athletic Club.

Ultimately the balance of the development was sold to Chadmar. They successfully completed Phase VI (The Lodges) in the mid-2000s. But the market was strong. Then we know what happened. Today, Phase VII (Creekhouse) is heading towards completion. It was a struggling development phase until the past 12 months when demand for these units skyrocketed. But here we are 44 years after the start of the development. And the massive Phase VIII (and/or IX) is nothing but sage brush and fill dirt. Who knows what the demand will be in the future? It could get sold to another developer with different ideas.

Despite the struggles and delays, can anybody say that Snowcreek is dysfunctional? No way. It is more popular than ever. All of it is fantastic, well maintained real estate. But it is a work in progress, like all of Mammoth. Mammoth may never be a “destination” resort, it is too busy on the journey.

One thing I love is a good old-fashioned conspiracy theory. Not the modern rhetorical use of the term, but something that makes you analyze facts and motives and circumstances. The process of thinking it through, asking good questions, testing hypothesis, etc.. I have my own personal conspiracy theory about this subject of Mammoth’s development “dysfunction.” It is largely the result of organized efforts by environmental groups like the Sierra Club to deliberately defuse development and expansion and intrusion into the Sierra Nevada region, especially our lovely local region. Simply an effort to keep it more pristine.

Okay, I’m nuts. But protracted lawsuits and other forms of influence peddling resulted in the death of things like the Snowcreek Ski Area, the linking of Mammoth Mountain and June Mountain via the San Joaquin Ridge and White Wing, Doe Ridge (what’s that?), the North Village redevelopment agency, extensive delays in the Mammoth Airport development and plenty more. These suits and actions killed valuable development synergy and momentum. The legal challenge to the Airport EIR was simply founded on “the growth inducing impacts” the airport expansion would create.

The lawsuit against the Village redevelopment agency is one that most people forget about or have no clue about. It would have created a public/private tool to pour a substantial portion of the property tax and bed tax revenues back into the Village development area including public amenities. If it weren’t for the litigation defeat, there may very well be the ice rink/indoor arena and 3-level parking garage structure on the existing parking lot next to Burgers. This was a key component of the 1994 Specific Plan changes. 

Like the new ice rink being built at the Park, these types of facilities are a money pit and some sort of public/private deal and added source of cash flow is the only way to make them viable. This ice rink multi-purpose entertainment facility was the key to the true viability of the Village. It would have also established the special events venue the community wishes for today. We could argue the merits of the lawsuit or the soundness of the plan, but this one action sealed the fate of the Village into an eternal dysfunctional abyss. Today, the Village is fine, but it will never attain the intended vision to compare and compete with other modern mountain resort faux alpine villages. And maybe this is okay. The journey is not complete. Maybe Mammoth deserves something different. Something better.

Oddly, our dysfunction of the day is not adequately protecting our greatest asset –– the local public lands. It is the utmost valuable real estate and is poorly managed. And the Sierra Club who repeatedly sued us in the name of saving these lands is really nowhere to be found. They appear to be off protecting the rest of the planet and not the namesake. And the Forest “Service” is little help either. So who is going to take the lead? I guess we’re going to find out.      

In the meantime, has anybody ridden the Mega Zip Line on Mammoth Mountain yet??

Happy 4th of July!

2 thoughts on “Mammoth Real Estate Q&A — A Journey Through Dysfunction?”

  1. Great article and thank you for taking the time. I am from Northern Vt. Live in Malibu and have been coming to mammoth6-8 times a year for 30 years. You answered so many questions. Although you left out the Highway they were going to put in between Agnew meadows and god knows where. As an outsider / insider I think the big reason it doesn’t look like arrowhead is the wind. Women / Mothers don’t like getting windblasted for days on end. We left Vt. Because of lack of sun. Grey day after grey day. To me it makes no sense given the incredible beauty that mammoth is not 3x the size in the state of 40M+

    Reply
    • President Ronald Reagan put an end to the trans-Sierra highway after riding through the area on horseback. It is why Main St. in Mammoth has those funny shoulder roads — it was the start of the project to put four lanes through to Fresno. That would have changed Mammoth in insurmountable ways!! Mammoth would have become a giant intersection. I’m sure the Sierra Club and LADWP had some influence in the decision.

      Reply

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