HVR Assets get broken up - Strawberry Hill sold!!
The assets of Humber Valley Resort have been up for sale by tender for the last few weeks, and the resulting bids have now been evaluated by the court Trustees Ernst & Young.
Known bidders were the resorts original founder Brian Dobbin, and a chalet owners consortium led by Mike Ward- both bidding for the whole resort, and each with differing business plans. Dobbin's was associated with being granted further crown land and so based on selling more land and chalets to new owners, whilst Ward's Team were driven by developing the exisiting resort and attracting a big name brand to build a hotel to act as the central piece to the resort and drive new marketing efforts.
Well, the news is that neither have won, and the assets are being broken up!
Strawberry Hill and the Beach House are both being sold (to different purchasers).
Not sure what happens to the other remaining assets, particularly the golf course and the club house. However importantly there are other assets that can't be forgotten, including the water supply system, the resort roads, utilities, office block, and the bridge etc. These are all key to the resorts future, let alone its future success. Add to that the fact that the golf course will loose money for the next few years, until there are sufficent resort visitors (local and international) to make it pay.
The business plans for any tenderer will need to handle all these asset liabilities, whilst also producing enough income to make a successful business - and now it has to do it without two of the key assets that would have been successful at an early stage!
In making the decision to split up the assets, what is the motivation of the Trustee?
It's an easy answer - simply to recover some cash as quickly as possible.
Does the Trustee have any compulsion to ensure at least it leaves the resort and its chalets as a working concern? No, not at all - the Trustee is quite within its rights, in fact within its instructions to get maximum monies and then close the case. In fact one quote I've heard is, if (for example) the water supply service is not sold - it will simply be turned off!!
But where does that leave the resort, and those that are passionate about it? No-one can be really sure at this stage. But for sure, as the assets get split up, the chances for a successful future deminish.
The future is uncertain, and there is a lot for everyone to think about - but now it doesn't include Strawberry Hill nor the Beach House!
Fingers crossed.
2 comments:
As far as I can see, Strawberry Hill or the Beach House realy has no effect on the Resort moving Forward,it will be intersting to see what the trustee has in mind now since he did not except eighter of the bids that were presented to him,Dobbins bid was for new developement, Wards bid is based on getting a hotell chain to opperate at the resort, both bids have issues, Dobbin has to make a deal with the Government for the expansion land, and the area that Ward wants to put a new hotel is the septic field for the existing Club House equally as challenging as dobbins issue
It's interesting where Dobbin and his team of engineers placed the septic fields and other assets such as the Administration building complex. Placing septic fields and buildings on prime real estate land (on the "driving range", beside the Manor House at Strawberry Hill in front of the river) shows exactly just how little experience the initial management team had. But they sure did have fun as did all the owners who bought in the early years. Unfortunately, the party has come to an end and everyone - locals and non-resident owners - are now paying the price.
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