Utah investors poised to buy Holland Lake Lodge
Laura Lundquist
CONDON - Two venture capitalists from Park City, Utah, have announced an intent to buy the resort at Holland Lake Lodge. But a Condon-based nonprofit organization is scrambling to finalize its own intent to buy.
On Tuesday afternoon, about 75 Swan Valley residents settled into the Condon Community Center to hear what two potential buyers planned for the controversial Holland Lake Lodge.
But the crowd made it clear to Eric Jacobsen, investment banker and private equity manager, and his nephew-in-law, Thomas Knowles, also an investment banker, that they weren’t ready to trust much of what the two men said, especially after the men said they had no plan they could publicize.
“You’re a smart guy, you’re a venture capitalist, you’re a businessman. The problem I’m having is you’re being asked a lot of direct questions, and you don’t seem to know a lot. You’re not a detail guy, and to me, that smells like bullshit. You didn’t put in an intent to buy without knowing the details,” said audience member Dean Johnson.
Almost exactly two years have passed since the Flathead National Forest suddenly announced that POWDR, a Park City-based ski corporation, had submitted plans to expand the lodge facilities. The facilities sit on U.S. Forest Service land, so the lodge owner must have a special-use permit from the Forest Service and get agency approval for any changes, such as an expansion.
Since that announcement, Swan Valley residents learned how much cooperation had gone on behind the scenes between POWDR executives, and Flathead National Forest employees, particularly former superintendent Kurt Steele, even before the expansion plan was announced. Watchdog Save Holland Lake uncovered the questionable dealings through multiple Freedom of Information Act requests.
After a year of public scrutiny, the project appeared to be abandoned. Wohlfeil listed the buildings and business for sale in October 2023 for $3.5 million, and POWDR withdrew its special-use permit application this past January. That’s why the audience was highly suspicious of the men’s intentions on Tuesday and questioned why they were interested.
Jacobsen said Christian Wohlfeil, a co-owner of Holland Lake Lodge, Inc., had called Knowles in October after POWDR pulled out, asking if he wanted to buy the resort. Knowles passed the message to Jacobsen.
“I said yes, I was interested. Christian spent a lot of time talking to a lot of people, and I think he had a hard time. I thought I’ll give it a try,” Jacobsen said. “We submitted a letter of intent in October or November. Then everything went dark. I assume Christian got a higher offer than what we were willing to pay. I suspect that offer fell through, and then in the weirdness of the POWDR-Christian relationship, POWDR took over responsibility for selling the lodge, and we got a call from POWDR. Then we submitted a letter of intent to POWDR.”
Jacobsen said he’d be the primary investor and planned on holding the investment for a long time, but there would be other investors including members of his family and they’d have some influence on decisions. He also said he didn’t want to run the lodge so he’d be hiring someone but not necessarily someone from the valley. Some people estimated their offer for the lodge was $1.2 to $1.5 million.
That led to audience members questioning who really owned Holland Lake Lodge Inc. Jacobsen said POWDR bought 20% of Wohlfeil’s business for $650,000 “to get inside,” and they now have the right to sell the business. Jacobsen said they have a deadline of Oct. 1 to put money down on the lodge. After that, they will start the Forest Service application process. They have already attended a “pre-application” meeting with the Forest Service, Jacobsen said.
Knowles said they had two options: apply for a special-use permit “as-is” with the existing footprint and operation, or apply for a new permit with an expansion, which would require a master development plan and public process. When one woman asked how many acres of public land were covered by the permit, the men said they didn’t know because there was confusion. The audience reminded them it was 10.5 acres.
Gubernatorial candidate Ryan Busse asked whether the men would sign a contractual obligation to back their promises to hire locals and not expand or sell out after a few years.
“I don’t want to contractually do anything that prevents it from being able to cover its costs,” Jacobsen said. “I believe there has to be some level of expansion. I think it depends on your definition of ‘significantly,’ but it requires roughly double the revenue.”
Jacobsen means double the revenue that Wohlfeil had been making, and Jacobsen said that revenue could come from more beds, higher prices, more nights of accommodation or some combination thereof. He didn’t know what the plan would be yet.
The men said they were trying to be transparent, but a few people asked why they called the meeting on short notice with less than a month to go after they said they’ve been pursuing it for a year. Jacobsen said he’s spent the time talking to local people and groups to get their take.
One of those people is Grace Siloti, president of Stewards of the Swan Valley, a nonprofit created about a year ago to preserve local resources including Holland Lake and the lodge. It turns out the Stewards have been pursuing their own plan for acquiring the Holland Lake Lodge. But they have been working closely with Wohlfeil, because Siloti said the Forest Service recognizes Wohlfeil as the owner, not POWDR.
Siloti said the Stewards were in the final phases of doing their due diligence and anticipate being able to send their own letter of intent to purchase Holland Lake Lodge, Inc. by Oct. 1. They are also preparing to publish a business plan by then, “so the public knows exactly what our intentions are,” Siloti said.
Even if Jacobsen gets the contract, Stewards will be prepared to jump in again if Jacobsen’s plans fall through, Siloti said.
“We’ve come too far. This has been two years in the making and trying to do things the right way. We want Christian to be able to move on and have a good life. So there’s good intentions for everybody,” Siloti said.
When Jacobsen contacted Siloti in November, she asked him if he would donate money to help the Stewards buy the lodge and keep it as a community resource, but he said no.
“Philosophically, I don’t believe that the right situation to perpetuate the lodge is a nonprofit solution,” Jacobsen said. “There’s a question of how much philanthropic money you can raise.”
Jacobsen said everyone has been asking him what his vision is for the lodge, but he doesn’t know yet. The one thing he was emphatic about is he isn’t willing to lose money.
“Pleasing everyone is going to be impossible. Something has to be done to change the business if the lodge is going to survive and do what I believe the lodge is intended to do. Things are going to have to change. The ratio of where those things are I don’t know yet. And people aren’t going to be happy with whatever ratio we put forward,” Jacobsen said. “But I envision many meetings and brainstorm sessions.”
Contact reporter Laura Lundquist at lundquist@missoulacurrent.com.