Jay Peak is officially for sale – will it be able to get the $250M to pay back investors?
News from Burlington Free Press and WCAX
After years of turmoil due to one of the biggest frauds to ever have hit the federal EB-5 program, Jay Peak Resort is now for sale.
Ariel Quiros, former owner of the resort and his partner Bill Stenger, allegedly as per the U.S. Securities and Exchange Commission misused $200 million in foreign investor funds, with Quiros pocketing personally some $50 million.
The investors have put down $500,000 each in order to receive a green card for themselves and their families. The Miami-based federal receiver Michael Goldberg said that of the 540 investors in Jay Peak, only six have received conditional residency and moved to the United States. About 160 are waiting for their permanent residencies to be approved.
Investors have not received their money back but will they? The answer depends on whether Jay Peak could be sold for $250 million.
Michael Goldberg pointed out that investors from China and other Asian countries, Latin America and Europe were never guaranteed their money back, but the 35 investors in Jay Peak’s Tram Haus Lodge have been repaid in full.
Goldberg said “This was not a loan, it was an investment, and it’s quite possible that these individuals made a bad investment. Basically, the resort will be worth what it’s worth. The fact is, even if there was no fraud, they may not have gotten their whole money back.”
New York’s investment banker Jeffrey Altman of Houlihan Lokey was hired by Goldberg to help sell Jay Peak. Altmann declined to comment the price in which he things the resort can be sold. He was involved in the recent sale of Stowe to Vail Resorts, advising the seller which was the insurance giant AIG.
Mike Krongel of Mirus Resort Advisors, located in Burlington, Massachusetts, explained that a ski resort’s value is estimated as some multiple of its EBITDA (earnings before interest, taxes, depreciation and amortisation).
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