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PRIVILEGED INFORMATION

DENVER BEGINS A LITTLE-PUBLICIZED DOWNHILL RUN INTO THE REAL ESTATE BUSINESS AT WINTER PARK. BUT WHOSE CASH COW IS IT?WHITE OUT THE CITY AND WINTER PARK BURY THE DETAILS OF A FOR-PROFIT REAL ESTATE DEAL ON PUBLIC LAND.

The father of current WPRA president Gerald F. Groswold also was a member. And the WPRA's weblike ties to the Arlberg Club still worry some observers. Longtime Denver City Councilwoman Cathy Donohue, now the director of the city's Office of Regulatory Reform, said publicly last year that she was convinced the WPRA would have flipped Winter Park directly to the Arlbergers had it been successful in closing its bargain-basement deal with Denver. Donohue today says she believes the club may still be angling for a piece of the action at Winter Park.

The Arlberg Club, however, doesn't like to talk about its land dealings at Winter Park--or anything else. Reached at his downtown law offices, club president Bruce B. Bee refers all questions to the WPRA, refusing even to confirm whether his club is a nonprofit corporation. The club is, and as such is required to file its income-tax statements with the Colorado Attorney General's office. The latest statement available, from 1993, shows that the club earned just over $64,000 that year running its private ski resort. Its biggest chunk of outside income: a $74,500 payment from the WPRA, which twenty years ago leased several parcels of land from the club to build its Mary Jane ski run.

Over the years, the Arlbergers have harbored their own visions of development at the ski area. In 1980 the club and the WPRA signed a 21-page amended lease agreement that, among other things, stated their mutual interest in base-area development. The plan the Arlbergers were most interested in at the time was one of their own: a project to build apartments, townhouses or condominiums on one of their holdings--upscale lodgings that would come complete with quarters for "servants or occasional guests."

As part of the amended lease agreement, the WPRA promised to pay for the construction of utility feeder lines and an access road to what the club called its "future facilities site," even agreeing to plow the road in the winter. It also agreed to do its best to keep members of the general public away from the club's private turf. In return, the club agreed to return to the WPRA $1,000 for each townhome, condo or other residential unit it built.

Along with many other real estate dreams of the 1980s, though, the club's hoped-for land boom failed to materialize. The club did later sell some of its other property to a private developer who built expensive condominiums, a project Medill Barnes describes as "a dismal failure. They thought they would break into the $300,000 condo market, and it just was a bomb."

Unlike Donohue, Barnes says he isn't convinced that the Arlberg Club stands to make a killing on today's planned base-area expansion. Most of the members put a higher value on their privacy than on growth, he says. But new development will certainly enhance the value of the club holdings in the area, he notes. And coupled with the WPRA's experience with the ill-fated Vintage Hotel, he says, the frustrated condo scheme on the former Arlberg land makes one thing clear: The old real estate saw that "you can't get hurt in dirt" doesn't always apply in the mountains.

"Needless to say, I point to those two wonderful endeavors as good warning signals that maybe the city ought to think twice about squandering its asset," says Barnes.

end of part 1

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