Vancouver-based Intrawest Corporation, the world's leading operator and developer of village-centered resorts, recently announced that it is cashing in to the tune of $160 million on established resort properties to continue expanding and developing new real estate ventures

Intrawest intends to form a partnership with Orlando-based CNL Income Properties, Inc., a real estate investment trust (REIT), in which CNL Income Properties will acquire an 80 per cent interest in commercial properties at nine Intrawest resort villages which have a total value of $160 million. Intrawest (ITW:TSX; IDR:NYSE) will continue in its role as property and leasing manager of all of the retail and commercial space involved, but not the resort lodging.

"Creation of this partnership is another significant step in our transition to a management-intensive structure from a more capital-intensive one," said Joe Houssian, Chairman, President and Chief Executive Officer of Intrawest. "This transaction will provide a significant recovery of capital as well as a partnership for future commercial development."

The agreement, scheduled to close before the end of December 2004, currently includes commercial properties at nine Intrawest resort villages including the two key Canadian properties of:

• Whistler Creekside at British Columbia's Whistler Blackcomb, host venue for the 2010 Winter Olympic Games, and

• The Village at Blue Mountain in Collingwood, Ontario.

Founded in 1976 by Houssian, Intrawest began as a residential and urban real estate firm, expanding into resort operations in the mid-1980s with its Whistler development. Now, Intrawest, with annual (2003) revenues of US$1.09 billion, also encompasses a premier vacation ownership business, 14 resort villages in North America and Europe, 29 golf courses and a major interest in the largest heli-skiing operation in the world.

Intrawest's latest real estate venture involves creation of the largest tourism project currently underway in North America: a C$1-billion, 10-year expansion at Mount Tremblant, Quebec, which boasts a mountain that has been voted #1 in Eastern North America for the past seven years. While the private sector will invest C$900 million, the federal and Quebec governments will make equal contributions to a total of C$95 million against projected tax revenues of C$1 billion. Taxpayers' funds will reportedly be used to develop road networks and water and sewage systems.

When Mount Tremblant first opened in 1991, the Intrawest resort welcomed 400,000 visitors (of which 5 per cent come from outside of Canada). Today, the number of visitors stands at 2.3 million (40 per cent of whom come from outside Canada). Once the project is completed, Tremblant will be able to receive more than 4.5 million visitors a year. Skiing and golfing are the resort's main attractions, but visitors will have nearly 200 activities to choose from. The number of employees will increase to almost 7,000, not including the thousands of other direct jobs that will be created in this Laurentian mountain resort.

"Development for the long term has always been at the heart of the vision and global strategy of Intrawest and Mont Tremblant Resort projects," stressed Houssian. "All necessary efforts have been made to ensure the utmost respect of the environment with a concern for maintaining what we already have and even creating environmental gains."

In the end, ski-able terrain will have expanded from 600 acres to 1,000 acres and the resort's capacity will have increased from 12,000 skiers per day to 20,000 skiers per day. The first pedestrian village will combine six hotels with a total of 1,500 condo-hotel units and a multi-functional convention centre of approximately 95,000 square feet in a corporate-oriented community. A second car-less village will offer more rustic family-focused holiday adventures.

Published: August 17, 2004

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