This Mammoth Real Estate Q&A appears in the Christmas Weekend 2021 issue of The Sheet
“Men, it has been well said, think in herds; it will be seen that they go mad in herds, while they only recover their senses slowly, one by one.”
Charles MacKay, Extraordinary Popular Delusions and the Madness of Crowds
Q: Most resorts we visit have plenty of timeshare properties and there are often timeshare salesman working the various visitor related areas. We have never seen this in Mammoth and want to know why this is?
A: This is a great question and one that is founded in both the history of Mammoth as well as the demographics. I would like to think the real estate clientele who come to Mammoth are more intelligent than the average timeshare “investor”, but I haven’t been involved in the timeshare business enough to really know. But why do I have visions of pina coladas?
Over the decades there have been many Mammoth visionaries and drivers who have pushed that Mammoth needs to strive to become a “destination resort”. In retrospect it is almost laughable. Mammoth’s location and primary customer base almost guarantees that it will never be a true destination resort. It doesn’t need to be. Thirty years ago I wrote a column “Destination Resort or Resort of Destiny?” It was obvious then and obvious now. And IKON and reliable air service aren’t likely to change this. Ultimately this could be the unique appeal of Mammoth. Many long-timers believe it was simply never “in the cards.” And I’m not sure anybody cares at this point.
Timeshares are often a component of real destination resorts. There is a higher volume of visitor traffic and thus a higher percentage of excitable and gullible dupes flowing through the tourist channel. And people from all walks of life. The timeshare sales process is high pressure, emotional and momentum selling. The classic “hard sell.” Quite frankly it just doesn’t really fit into the the Mammoth environment. But unquestionably it is popular and successful in many places, or at least it has been.
The Intrawest sales process of the late 1990s and early 2000s wasn’t timeshare selling by nature but the process was modeled after many of the traditional timeshare sales techniques. The Intrawest mantra back then was “selling is the transfer of enthusiasm”. And if you weren’t enthusiastic you didn’t cut it on their sales team. Also, their selling process was ongoing for months (or more than a year) as opposed to during a weekly vacation to some exotic location.
I’ve never considered timeshares or fractional properties to be real estate per se. I was involved in the sale (as listing agent) of a large piece of land in the early 2000s that became a fractional project (Tallus). When the buyers told me what their intent was they were disappointed that I wasn’t enthusiastic about their new venture. I told them it wasn’t going to work, it was the wrong market. They told me that I “better get on board” because this was the future of resort real estate. The crash of 2008-09 crushed the project, but it was doomed from the beginning.
Timeshares can be an interesting case study in modern society and psychology. Resort properties can generate some interesting ways of thinking, especially for buyers. Some of it is pure cocktail party thinking. Ooohh, “our Mammoth cabin is in Snowcreek”. Timeshare owners are often heard saying “we’re going to our timeshare” like it has certain bragging rights. I’d rather tell people I’m going to the doctor to have my hemorrhoids checked out. Even though lots of very smart people end up buying timeshares, they haven’t figured out that timeshares are for dupes (or suckers, or whatever you want to call them). But fear not, the world is full of them. Men go mad in herds. That’s why they have been so successful in the past.
But the lack of timeshares in Mammoth isn’t necessarily the lack of people being preyed upon. It has to do with the fact that Mammoth is more like a commuter resort rather than a destination resort. The proximity to the large population base of southern California makes it very convenient to the masses. The closeness, yet distance to a major population base has become a real asset (whether people realize it or not Mammoth is the crown jewel of the Alterra resorts because of this). And the relative isolation. Small town, big playground. All of the open space you see isn’t for sale nor is it developable. The government owns it and there is more of it reverting back to public ownership than vice-versa (land in the Mammoth region only becomes more valuable because of this).
And compared to many destination resorts, Mammoth is more about outdoor recreation, especially rigorous activities and athleticism. Like in the spirit of Dave McCoy. While Mammoth is a fantastic place to relax, the primary purpose of coming to Mammoth is to engage in some sort of outdoor activity. Much of this outdoor activity is linked to certain conditions, especially new snowfall. Cheap ski passes have accentuated this. So being pigeon-holed into certain time periods like timeshares really doesn’t work for Mammoth fans. The fractional properties in Mammoth don’t really work to this condition either. It takes a good deal of luck to coincide the allotted time to the desired time.
But the whole timeshare evolution is fascinating. Sometimes it just takes people longer to figure things out. It is human nature. Today, getting people out of time shares has become big business. Many of these companies are legitimate and can perform. Other “timeshare exit” companies have proven to be fraudulent or non-performing (imagine learning the meaning of “fool me once, shame on you. Fool me twice, shame on me”).
From a real estate standpoint, timeshares are the epitome of “easy to get in, difficult to get out of.” From an investment standpoint they are the worst. They depreciate rapidly and soon become substantial liabilities that are nearly impossible to sell even at a great loss. The successful timeshare exit can often cost multiples of the original purchase. And as one of my friends likes to say “who gets it in the divorce?”
Much of this could be said about the fractional properties here in Mammoth (but “they really are real estate interests” is the sell). I have told people in the past to go ahead with these purchases if they can afford to throw the money away. Then it makes sense, at least in my mind.
The whole fractional/timeshare discussion here in Mammoth would not be complete without weaving in the infamous Mammoth Airport litigation settlement. Everybody has their ideas and “takes” on the topic. (As disclosure I was part of the original planning effort and have been an owner in the Hangar Group almost since the inception.) The final court decision and judgement was a travesty in so many ways.
The original housing plan at the airport included homes and even deed restricted workforce housing units. I remember the original plans that included zero-lot-line duplexes (wouldn’t it be nice to have a couple dozen of these deed restricted units today for families to live in?). Then the plan evolved (devolved?). A small lodging element appeared in the plans and the duplex-style units were proposed to become available for nightly rental. Of course to push the density some of the workforce housing units would remain (allowed by California planning laws).
By the time the case went to court the whole project was a fractional and timeshare project with exorbitant revenue and profit projections. It was a farce. And as I have pointed out in the past the expert witness at the trial wasn’t adequately cross examined. It was obvious at the time of the trial because the two fractional projects developed in Mammoth (in that era) were already both in receivership (bankrupt). How could one expect success at the Airport if the Village and Sierra Star developments were a failure? The view at the Airport is spectacular, but…
What makes the whole Airport fiasco even more irksome is what happened while all of this painful litigation and appeal process was going on. The lead agency, the FAA (the Federal Aviation Administration), announces that it is their policy to never allow housing units to be developed this close to a runway, including Mammoth.
Now I don’t want to offend anybody at the FAA because we rely on valuable matching grants (9 to 1) for capital improvements at the Airport. But the planning process for these housing units adjacent to the runway went on for years. It was not a secret. There were numerous planning iterations and they all represented substantial housing units right behind the west hangars. The FAA officials were part of the planning process. Why was the housing component planning allowed to continue for years and years if there was this established policy to not allow it? No one seems to know.
The massive Airport judgment was a sham based on bogus fractional and timeshare properties that nobody really wants in Mammoth anyway. And a federal government agency ultimately helped mislead everybody into thinking the development was even remotely possible. And it was protracted process with plenty of government participants. Sounds like our current dilemma with forest management and wildfires.
So timeshares aren’t a part of the Mammoth environment and this is probably a blessing. But I’m sure someone in Denver is scheming to sell a sizable piece of land at the Main Lodge for such a development. The cash flow projections will be amazing. Some bank is probably anxious to lend on the land at a lofty level (anybody remember the Ritz-Carlton project in the Village?). And they are probably pondering the timeshare sales booth at the Bishop Airport too. With the Main Lodge land exchange finally completed the pro formas are probably already in hand. I wonder if they’ll pay a commission (LOL)?
Timeshares have a long legacy of people being conned into something they shouldn’t be participating in. We should be thankful they haven’t proliferated here. They are deceitful enterprises. And unfortunately Mammoth has a long and entrenched relationship with government agencies who are also often misleading, conflicted or duplicitous. It goes with the territory. Here’s to all of us being smarter in the future!
Happy New Year!