Out of this economic morass came a proposal to pump up Oregon's tourism economy by easing the state's land use laws for resorts that would draw tourists from around the country to our state where they would spend money, creating jobs and injecting cash into our local economies. With its proximity to the mountains and disproportionate amount of sunshine, Central Oregon was a natural choice for developers. Fueled by a national real estate boom and easy credit, real estate and resort developers converged on Deschutes and Crook counties over the past few years floating one proposal after another for increasingly massive resorts.
But lately things haven't been looking so good for destination resorts. Sales are down and prices are dropping. The once red-hot residential real estate market that fueled the resort industry has entered the deep freeze. Developers who aren't in too deep are putting plans on hold, and those who have already broken ground are finding that their once steady stream of cash has run dry.
Last week one of the area's most ambitious resorts, Tetherow, confirmed that it is putting its plans for a hotel on hold indefinitely because it doesn't have the money to build. In fact, it already owes its architect nearly three quarter of a million dollars that it can't pay. That wouldn't be a problem for anyone but investors, except for the fact that, by law, resorts are required to build a certain percentage of overnight units to accommodate resort guests. These overnight guest accommodations are one of the reasons that the state has carved out special rules for resorts. And Tetherow isn't the first resort in Central Oregon to fail to produce its promised hotel. The exclusive Pronghorn resort has said that it doesn't have the money, or the market for a hotel. The development, which sits east of Redmond and features an "owners only" Tom Fazio designed golf course, has received four extensions on its hotel deadline from Deschutes County.
The failure to deliver on these promised overnight accommodations underscores one of the dirty little secrets of the resort industry in Central Oregon. And that is: they aren't resorts at all - they are housing developments for wealthy retirees who want privacy and exclusivity above all. Those in the industry know there is no money in hotels, restaurants and golf courses. Resorts exist for developers to sell homes.
This past week the state of Oregon convened a hearing in Prineville to kick off its plan to re-examine destination resort laws. During the hearing they heard plenty from Central Oregon residents about the impact the resorts have on wildlife, water supply and the rural character of places like Powell Butte.
The committee has plenty to consider in its overview, but those of us who have been watching this industry over the past few years already know that these resorts are a sham. It's time to close the book on this misadventure. In the meantime we're giving the destination resort laws The Boot.
