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BC Recreational Real Estate Offers New Products for Changing Times
By Randall Walford
(Reprinted from the Calgary Herald, "Recreation & Investment Properties" supplement,  May 16, 2001)

Panorama Mountain Village

From Golden in the north to Fernie in the south, Eastern BC's recreational real estate market is hopping. Why? Demographic economists like Harry Dent, author of "The Roaring 2000s" tell us that for baby boomers 45 years and older, their top "acquisition objective " is recreational real estate. Estimates are that Calgarians account for 75% of recreational property purchases in Eastern BC. What is noteworthy is where the other 25% of the buyers come from. The pristine beauty of eastern BC is getting better known throughout the world. Improvements in local transportation and tourism infrastructure are making international travel to the region easier. Buyers are now arriving from the US, UK, and Europe to buy world class resort real estate at bargain prices. Like the Calgarians who 50 years ago bought waterfront Lake Windermere lots, these buyers recognize a good deal when they see it.

Fifty years ago, the Windermere Valley was a 12 hour drive to Lake Windermere. Back then, the family recreational property was typically a cabin on the lake occupied on weekends and for the family vacation. Most family recreation was home-made.

Now the Columbia Valley is a 3 hour drive from Calgary. It is valued for a dozen or more golf courses, the closest warm water lake to Calgary, and boasts four excellent ski operations. It's pristine beauty, world class golf, skiing, mountain biking, paragliding, hiking, climbing, and other activities attract a broad range of visitors. Today's recreational property buyers have more choice and more focus than those of yesterday. Many will purchase in a 'lifestyle' development to pursue specific recreational interests. Examples are Intrawest's Panorama, which features North America's second highest vertical drop ski hill (after Whistler) and the world class Greywolf golf course. Another is The Lodges At Kimberley Ridge. Located at the base of the ski hill, these units are also within a stone's throw of the Trickle Creek golf course, rated one of BC's top courses.

Today's buyer looks for more amenities and less maintenance requirements from their property than did their parents' generation. To meet the needs of today's buyers, new real estate and quasi-real estate products are now available. For example, Lakeview Meadows Mountain Community on Lake Windermere is just completing its show home for a phase of alpine style strata duplexes in lovely treed settings. The development features shared beach, sand volleyball court, tennis courts, planned recreation center with swimming pool and spa, 35 acres of green space, and an extensive trail system that can be navigated by foot, golf cart, or bike. The units are designed to provide a carefree lifestyle so families can spend their leisure time in activities more attractive than yard maintenance.

Today's products are high on amenities, low on maintenance, and generally have shared beach area, or are on a golf course, ski hill, or close to other amenities. A trend seen migrating from more developed markets such as Whistler and premium US destinations is the sale of fractional real estate interests. Fractionals, a relatively new concept, are a modern solution to balance ownership costs with partial use: Studies show today's owner will probably spend only 22 to 26 nights a year in his or her recreational property. Fractionals answer the question: "Why pay for all of it when I only need a quarter, sixth, or eighth share?

The purchaser of a fractional interest gets a fraction of a particular unit in a development, as distinguished from buying the whole interest in the unit. Along with that comes the right to occupy and use the unit for a time period corresponding to the size of the fraction purchased. For example, buying a quarter interest would give the right to occupy and use for 13 of 52 weeks ( or every fourth week) of the year. The share of maintenance and taxes paid by a fractional owner correspond to their percentage share of ownership. Fractional interest programs share acquisition and maintenance costs with a number of owners. While fractional programs have been around for some years in the US, they are relatively new in Canada.

Time share interests are a quasi-real estate product where buyers get a contractual right to use a unit rather than a registered interest on title. Timeshares have gained wide popularity due to their affordability, high amenity level, and flexibility. Most time shares are based on a lease of a unit for forty or fifty years. Buying a one or two week interest gives the right to occupy a designated type of unit during a designated week or season. Often associated with major resorts, a time share usually provides a high amenity and service level with no owner responsibilities other than paying maintenance or user fees. Many timeshare developments belong to associations that enable owners to exchange their right to occupy for a unit elsewhere in the world, giving an added degree of flexibility. An example of such a product is Bighorn Meadows Resort, a 5 star property on the Springs golf course in Radium Hot Springs.

Timeshares and fractional interests make it possible for more families to regularly enjoy their holiday time together, and these two products are forecast to become increasingly popular given current trends.

Something very exciting is happening on the Shuswap First Nations lands outside Invermere. Through partnerships with Calgary developer Stone Creek Properties, the magnificent Eagle Ranch golf course has been completed. Plans call for a toney new club house in the style of a grand CP hotel and for residential development along the golf course, where staggering views of Lake Windermere and the Rockies ensure high resale values. Largely misunderstood by the buying public, today's long term pre-paid lease of native lands provide excellent value and security. If private investors and chartered banks are financing this development to the tune of $500 million or more, it should be apparent that due diligence adequate to protect a buyers interest in a lot or strata unit has already been done.

Today, more than ever before, there truly is a recreational property for every taste and budget in the British Columbia Rockies.

Randall Walford Professional Corporation ©2001

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