Friday, December 19, 2008

Humber Valley Resort chalet owners take important first steps towards recovery

Wester Star article:

When he bought into the Humber Valley Resort dream back in 2003, Simon Burch never envisioned he would be organizing contracts to provide essential services to the site nearly six years later.

Despite some nightmarish developments in the last year or so, the dream is still alive for Burch and the other chalet owners at the resort who are doing their part to shake the facility out of the doldrums.

In the past few days, service contracts to provide snow clearing and garbage collection at the resort have been confirmed. A flyer, similar to the trucks used to clear the province’s highways, and a front-end loader will handle snow clearing, sanding and ice removal.

Dumpsters will be place on-site for resort owners and users to deposit garbage for regular collection.

Security at the resort, which went into bankruptcy Dec. 5, is in place 24 hours a day, seven days a week.

The provision of water and street lighting is being handled by Ernst and Young, the trustee in bankruptcy.

In addition to those essential services being made available, a number of companies are working on behalf of chalet owners to market properties available for rent. Some chalet owners have opted to take it upon themselves to market their chalets on their own.

With all that in place, Burch — a member of the committee representing 300 chalet owners — said the resort is once again a going concern.

“All the essential services for people wanting to come stay on the resort are now available,” said Burch as he drove past a snowplow clearing one of the resort’s thoroughfares.

“People can safely book a holiday here now, secure in the knowledge they will be able to get in and out of their chalets and arrangements are in place for rubbish and water.

“What they won’t have for this winter is a bar and restaurant. What will happen with those facilities will only become clear as the process of bankruptcy moves forward.”

That’s a big step forward from this past fall when Newfound NV, the owners and majority shareholders in the Humber Valley Resort Corporation, shut the operation down as it filed for creditor protection and tried to restructure the resort’s business plan. Those efforts failed and the corporation went bankrupt earlier this month.

The key attractions of the Humber Valley, said Burch, still are the scenery and the local people. The recent history of the resort generated a lot of bad publicity for it and the Humber Valley region in general, not to mention create bad blood between those who have invested in chalets and the resort management.

Burch will be marketing his own chalet and three others, but didn’t want to do so until essential services were in place.

“There’s nothing worse than letting people down and that’s what the resort did before it went bust,” he said. “They didn’t bother to tell some of the people who had booked that they were closed. For weeks after, people were turning up at the gate, expecting to come in and stay and were being turned away. That was good for local hoteliers, but terrible for the trading reputation of Humber Valley.”

Burch, who will concentrate on marketing to the St. John’s area, expects new marketing efforts from all the owners will ramp up soon.

‘Good future’
“This resort still has a very good future,” said Burch. “All the key building blocks that encouraged us to buy here are still here. What we have is a company that did a terrific job of realizing a vision and building a resort, but a lousy job of running it, that has now gone bust.

“That is a new opportunity for the owners to create, in conjunction with government and all the other local stakeholders in our economy, a structure for the resort that will work going forward, so that, over a period of time, we can realize the vision we all bought into without all the wastefulness and mismanagement that’s plagued the place for the last four or five years.”

Don Cross drives one of the machines owned by NCL Holdings, the Deer Lake company hired to do the snow-clearing duties. He too is confident the resort will bounce back.

“It’s good to see people coming back here who are going to spend time on the west coast,” he said. “The economics of it all still makes good sense for this area.

“It’s too bad so many jobs have been lost, but that’s the way it goes sometimes. I definitely think it’s going to rebound. There are too many homes and chalets here to let it go now. There’s no way everybody is going away.”

While the resort owners feel they have gotten over an important hurdle towards recovery, Burch said they only have a short while to catch their breath before going abut the task of revising how the resort will operate into the future.

The next major step will come Jan. 7 when Ernst and Young will meet with Humber Valley Resort’s hundreds of creditors, including chalet owners and Newfound NV — the latter which invested more than $44 million into the resort. According to documents obtained by Transcontinental Media, some 279 creditors are owed more than $100 million.

Not welcome
There has been some talk that Newfound NV could be in a position to actually buy the back the resort as part of the bankruptcy process.

Burch said Newfound NV is not wanted back.

“That would be a travesty,” said Burch. “They have walked away from their commitments to the owners, from their debts to the local businesses and from community and they haven’t demonstrated any commitment to the resort, to the island or to making a success of this place.

“Jane McGivern (Newfound NV’s chief executive officer) is on record in interviews published in property press in Europe that she’s not interested in running a resort — that she’s a property developer. My message would be to go develop your properties and leave us to get on with finding a way to make this resort work without your interference and getting in the way.”

Burch said repairing the resort’s damaged reputation will be the goal of the owners, though he has no idea how that will be done or how long it will take.

“This isn’t the end,” he said. “This is a new beginning. It’s an opportunity for competent management to be brought in and do the job properly and that will make an enormous difference.”

Western Star article Gary Kean


Anonymous said...

Hey Daniel,
It's Tanya (from HVR), just wondering how people would go about booking a rental??? I know a few people interested in a weekend away??
Merry Christmas to you and Kate!!

Anonymous said...

Hi Tanya,