 |
| pc: Friends of Saddleback Mountain Facebook Page / Luke Labbe |
Key Points
Who is Arctaris Impact Fund?
One of the super-important points is understanding who Arctaris Impact Fund is. This is a professionally managed fund that invests in businesses in targeted rural communities, combining public capital from federal and state government agencies with private capital from institutional investors, foundations and community reinvestment act banks. And they aim to generate above-market returns for its investors. Bottom-line, they need to put together many pieces for a deal structure that will get Saddleback open AND be profitable. Community philanthropic support that creates the ability to leverage federal tax credits is a key part of the deal.
What is the current status of the deal?
Arctaris is staring down a December 23rd deadline to close the deal with the Berry family. This deadline is primarily driven by tax credits that have near-term deadlines and the need to get started on the significant amount of work to get the mountain open again for the 2020-21 ski season. They have a purchase agreement in place with the Berry's to buy the mountain for $6.5 million dollars cash at closing. Over the course of an 8-year plan Arctaris intends to invest over $38M into the revitalization of Saddleback which includes $28M in the form of equity and debt, which will leverage an additional $5M of tax credit equity. The pieces of this deal include:
- New Market Tax Credits (a federal program which provides an incentive for investment in low-income communities)
- Loan guarantees from the Finance Authority of Maine (FAME)
- Local support from the residents, condominium owners, and local philanthropies.
This community meeting was really about generating local support from the Rangeley area community. They are looking to raise $5MM from the community using the Saddleback Mountain Foundation as the fundraising mechanism. Specifically, Arctaris needs to raise:
- $2M by December 16 to meet the obligation to close on the acquisition and have cash available post-closing for immediate on-mountain improvements.
- $2M by January 31 in time for the New Market Tax Credit closing
- An additional $1M by the planned December 2020 re-opening date.
How much does Arctaris have in-hand? They have pledges of commitments that gets them close to the initial $2MM goal, but the race is on to meet the initial fundraising deadline of December 16th of getting the cash in the door for the December 23rd closing. We highly recommend taking a few minutes to watch this video from the community meeting which discusses the current fundraising status and the need for local support.
December 9 Update - Quoting Saddleback GM Andy Shepard from a Portland Press Herald article
Arctaris has commitments for $1.7 million from local philanthropists, supporters and condominium owners. The company gave itself until Dec. 16 to raise the money through a nonprofit called the Saddleback Mountain Foundation. “We need that $2 million in order to close, we also need that $2 million to demonstrate to all these investment partners that we are capable of raising that money within the community,” Shepard said. “We are also confident it will happen and are not anticipating any problems.”
What are the plans for investment?
Pending a successful closing, Arctaris plans for new lifts, base lodge repairs & improvements, snowmaking upgrades and investment in summer activities including an on-mountain coaster and mountain bike trails. Future plans also call for hotel and restaurant development on the mountain. Exciting stuff for sure but all of this won't matter if they don't close the deal December 23rd.
How can we help?
It appears the primary fundraising focus is on engaging the local community with these meetings and having individual conversations with local groups and business leaders. Additionally, they need FAME approval for the loan guarantees which is a critical piece that needs to happen for closing. The Saddleback Mountain Foundation is serving as the fundraising mechanism for the local community dollars to flow into the deal. The more money that is raised through the foundation, the larger the tax credit will be available for use.
This is a screen capture of the donation form that was handed out at the community meeting. We have also obtained the following official donation forms from the Saddleback Mountain Foundation:
As they cast a wider net for fundraising we are sure more public information will be made available and our blog will publish information as it becomes known. If you want to help immediately we recommend sending an email to saddleback.mtnfoundation@gmail.com to request more information and/or you can send a check or gift securities using the form links listed above.
As they cast a wider net for fundraising we are sure more public information will be made available and our blog will publish information as it becomes known. If you want to help immediately we recommend sending an email to saddleback.mtnfoundation@gmail.com to request more information and/or you can send a check or gift securities using the form links listed above.
Bottom Line
This is the best shot we have in getting Saddleback open again. A "traditional" buyer has not emerged publicly and we need a unique cooperative solution to get the sale done. Arcatris Impact Fund has a mission to invest in rural development opportunities AND an obligation to its fund investors to provide a positive investment return. The Rangeley area and the state of Maine have a desire to get the mountain open again and turn back on a key economic cog in the western Maine mountains. The Berry's have a desire to get a return on their investment and hand the keys of the mountain over to new owners ready to write the next chapter for Saddleback. The Maine and New England ski community is ready to take runs down the magnificent trails of Saddleback again. This is not Arctaris first rodeo and they are experts and threading the needle in very complex investments.
We will update this blog when new information becomes known. We wish all sides nothing but the best in getting this deal done. A successful deal closing would be an amazing Christmas present for everyone!
Recent News Articles
- Bangor Daily News - Prospective buyers are asking Saddleback condo owners to pitch in on resort’s revitalization
- The Irregular - Close to closing the deal
- WCSH-TV - Saddleback buyers seek $2 million before sale deadline
- Portland Press Herald - Boston firm moves to finalize Saddleback purchase
- News Center Maine - Investors race to raise money to close on Saddleback purchase
- Maine Public - Investors Race To Raise Money To Close On Ski Area Purchase
Thanks for the report and helpful explanation of what's going on with this purchase. Saddleback has been a favorite ski destination of ours for years. While we don't own property there, we really want to come back when the mountain is open again. We'll be sending in a small donation as a gesture of goodwill, hoping the same from hundreds of others to get this deal done!
ReplyDeleteHopefully they can pull this all together! We are rooting for all the parties involved!
DeleteIs there no way to donate online?
ReplyDeleteWhere are the demographic data to suggest that sufficient patronage now exists to make the ski area profitable, when it was not previously viable?
ReplyDelete