Ski company to the rescue at Park Avenue
A logjam that threatened to stall the 1999 startup date for the 34-acre Park Avenue Redevelopment Project was loosened Thursday with a ski pole.
American Skiing Company officially received the rights to develop the Lake Tahoe Inn. ASC already planned to develop the Park Plaza hotel component as an ASC Grand Summit Hotel as well as the gondola that will connect the state line corridor to Heavenly Ski Resort, an ASC property.
“It became clear to us that the project wasn’t going to go ahead on time as the community wanted and to be healthy for the project,” ASC founder and Chief Executive Officer Les Otten said of the decision to take on another piece of the project.
With the two hotels, ASC will develop more than 750 units in the project, 273 rooms in the Grand Summit Hotel and about 500 rooms in the Lake Tahoe Inn.
“Each project will be developed as different entities so both command different places in the market,” said Otten from his Maine office.
HKM Partners had the original rights to the inn. After initial planning, the partners consisting of Bob Maloff, George Karadanis and Max Hoseit felt a redevelopment venture was more than they wanted to tackle and recently sold their rights to Trilogy Development Corporation.
When Trilogy stepped out earlier this month, American Skiing Company stepped in.
“Everyone concerned wanted to see the project move forward in 1999,” said Dennis Harmon, Heavenly’s managing director. “Trilogy didn’t think they could make that deadline.”
According to Maloff, Trilogy’s obligations in Canada prevented the company from meeting the community’s expectations.
“I think all three of us (in HKM) are very happy (with the new developer),” Maloff said. “It’s good for us and it’s also good for (ASC) and our community. They want to do things and move things. … I really think they are the right people for the project.”
When redevelopment plans began about 10 years ago, the gondola was the only piece of the project planned by Heavenly, then owned by Kamori International Corporation. ASC purchased the resort in August 1997.
“This is an extra opportunity to fulfill the dream of so many people who have worked so hard on this,” Otten said. “A lot of people had a lot of vision and we’re fortunate to follow through.”
Neither Maloff nor ASC officials would reveal the dollar amount of the agreement. The cost of the project itself is uncertain because the design has not been established but Harmon estimated it would be in the tens of millions.
As to the value of the project as a whole, Otten characterized it as a “big number, in nine figures” depending on how you looked at it.
The Park Avenue Redevelopment Project itself is expected to cost $200 million.
Besides the two hotels and gondola, the project will include retail shops, a cinema and ice rink.
Other partners in the project include the South Tahoe Redevelopment Agency, Trilogy Development Corporation, John and Camilla Jovicich, owners of Cecil’s Market, and the Tahoe Crescent Partners.
Demolition of the 1950s-era buildings between Park Avenue and Embassy Suites Resorts on the south side of U.S. Highway 50 is expected to begin in May of 1999.
Between now and then, the final architectural plans will be made by the developers while the city Redevelopment Agency begins negotiations to buyout business in the demolition area and bond sales.
“Obviously, we’ve got a lot of work to do ahead of us to be ready.” Harmon said. “Now we’re assured from our standpoint, we’re pretty certain we can move forward in the summer of 1999.
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