Otten outlines plan to proceed with redevelopment of Balsams
December 9th, 2021
From The Berlin Daily Sun
“WEST STEWARTSTOWN – Balsams developer Les Otten on Wednesday unveiled plans to have a national non-profit organization build the planned new hotel and conference center at the resort. After seven years of effort, Otten said the collaboration will allow the redevelopment of the former grand resort to proceed.
In a presentation to the Coos County Commission, Otten said the plan calls for Provident Resources Group to be the majority owner of the new Lake Gloriette House hotel. When the hotel and center is constructed, the Balsams will oversee its operations as part of its overall redevelopment plan for the resort.
Construction of the new hotel would be financed through tax-exempt bonds which would be sold to institutional investors. Otten said Goldman Sachs has agreed to act as the proposed underwriter for the placement of the tax-exempt bonds. While details of the project are still being worked out, the draft resolution indicated Provident could be seeking up to $115 million in revenue bonds in total on the project.
Under legislation approved in 2019, the Coos County commissioners are authorized to issue the revenue bonds for unincorporated places like Dixville. A tax assessment financing district would be established and the bonds will be repaid through assessments generated by the district. Otten said he would like the commission to approve a resolution supporting the arrangement between his company and Provident as soon as possible.
Officials stressed that the county will not be responsible for any repayment of the bonds.
‘To be clear, there is no financial commitment or liability of the county whatsoever. The bonds are not an obligation of the county in any way. They are solely the obligation of the Provident entity involved in the ownership of Lake Gloriette,’ stressed Otten.
In fact, once the bonds are paid off, the net-free cash flow will be used for qualified charitable projects in Coos County, boosting economic efforts here.
Provident CEO Steve Hicks explained that Provident’s charter allows it to undertake projects in education, healthcare, and for the benefit of state and local municipalities. As an example, he said his firm helped the city of Irving, Texas, finance the Irving Convention Center hotel. Provident will form a limited liability company in New Hampshire and the county can appoint one local person to sit on its board.
Otten said he and his team were introduced to Provident earlier this year and have been quietly working on the collaborative structure for most of the year. He said the parties will be going through a due diligence process over the next several months, with the aim of concluding a transaction sometime in March. He said reappraisals are being done of both the property and real estate. He said the report on the viability of skiing will also be redone, noting the first report called the Balsams ski area one of greatest places left in the Northeast.
Otten said his team is also going to be working for the next 90 days on pre-sales for deeded fractional inventory in the existing Dix and Hampshire Houses.
Coos Delegation Chair Robert Theberge (R-Berlin) asked the commission if the matter should go before the delegation. Commissioner Paul Grenier (D-Berlin) said since the delegation is meeting Monday, he felt the commission should present it to the body before voting on the resolution. He said he felt it important to get the delegation up-to-date on the proposal. The commission scheduled a special meeting to vote on the resolution right after Monday’s presentation to the delegation. But the commissioner left no doubt about his support for the resolution.
‘I’m 110 percent in support. I can’t wait to get this off the ground,’ Grenier said.
Rep. Edith Tucker (D-Randolph) said she was ‘wildly enthusiastic’ to see the latest proposal. Tucker noted that she was the prime sponsor of the bill that allows the county to authorize use of the revenue bonds in unincorporated places like Dixville.
Tucker said she felt the involvement of the nonprofit Provident and the eventual use of money from the revenue bonds for county projects would have pleased the former owners of the Balsams Resort, Neil and Louise Tillotson. A fund set up by the couple makes grants to many educational, economic, recreational, and artistic endeavors in northern New Hampshire.
Otten has been working for seven years to redevelop the Balsams and last year brought out his remaining partner and now owns 100 percent of the project. Otten and his team have put together a $180 million expansion plan that also includes opening and expanding the former Wilderness Ski Area.
Headquartered in Baton Rouge, La., Hicks said Provident has been in operation for 21 years and has undertaken projects in 21 states. He said they currently have just under $4 billion in assets under management. He said he was ‘blown away’ by the beauty of the Balsams property on a visit there earlier this year.”