Northstar workforce housing: Owner hopes defaulted property will have a buyer soon
TRUCKEE, Calif. andamp;#8212; Potential buyers are looking at another regional development that has fallen on hard times andamp;#8212; this time, a $25 million, 96-unit workforce housing complex at the base of Northstar-at-Tahoe Ski Resort.Constructed in 2006, the Sawmill Heights apartment complex was designed as an affordable housing option for resort and local employees. However, when the economic tide began to shift in 2008, Northstar Community Housing Corp. of Truckee andamp;#8212; the property owner andamp;#8212; was forced into default in October of 2009.Complex manager Gerry Flynn of Polarstar Property Management said in the winter, occupancy rates brim to near full capacity, but in the off winter months, occupancy swings as low as 50 percent andamp;#8212; something he said was an unforeseeable occurrence at the time of construction. Contrasted with Polarstarandamp;#8217;s six other resort clientele in Colorado, Flynn said the occupancy demand was not as high, in large part, due to a lack of year-round demand at Northstar.andamp;#8220;Itandamp;#8217;s a fairly dramatic difference,andamp;#8221; Flynn said.He attributed poor public transportation at Northstar during the summer as a major reason for a lack of demand.andamp;#8220;Affordable housing was much more of a critical issue five years ago than it is today,andamp;#8221; said Flynn. andamp;#8220;Now, the game plan is likely to sell the property to a new owner who agrees to pay off part of the debt to US Bank (the original lenders).andamp;#8221;Yet, finding a buyer and negotiating a final price tag, Flynn said, would have to be coordinated with US Bank, who will most likely be forced to settle for a significantly reduced price.andamp;#8220;Theyandamp;#8217;ve got to agree to a short sale price,andamp;#8221; Flynn said. Grubb andamp; Ellis Company, a Sacramento commercial real estate firm, is handling the sale.Flynn said the buildingandamp;#8217;s relatively new four-year-old structure constitutes an advantage. Unlike some aging resorts and hotels around Tahoe, Flynn said, the maintenance costs and facility upkeep is negligible.He added that talks with potential buyers are under way; and while he isnandamp;#8217;t at liberty to describe specifics, Flynn said news will come shortly. andamp;#8220;I would expect to talk about it in the next 90 days,andamp;#8221; he said.Amid the dearth of the recession, the Sawmill Heights situation is the latest in a string of tough news this year for development in the area.In March, East West Partners filed for Chapter 11 bankruptcy protection, which had threatened Grayandamp;#8217;s Crossing, Old Greenwood and Northstar Highlands, among other developments. Financial partner Barclays, a British banking and investment company, put up a $10 million reorganization loan to assist the real estate firm with its debt.On March 31, Bank of America filed a notice of default against the Ritz-Carlton Highlands, Lake Tahoe, the luxury resort at Northstar that is managed by East West. Then in May, a lending group that included Bank of America took over ownership of the Ritz to allow East West to recover and reorganize.
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Friends of the Truckee Library gave a presentation at Tuesday’s Truckee Town Council meeting, providing an update on work to ensure a new library while asking for further support for the project.