Robert Levine was skiing down the slopes at The Peaks Resort & Spa in Telluride, Colorado, a world away from his coastal development projects, when he noticed an undeveloped parcel of land near the piste.
It was 1995, and the RAL Companies founder had already noticed his fellow skiers had an awful lot in common with the residents of his development projects back in New York. And as he kept gliding past the parcel to the lifts, he couldn’t shake his fascination with it.
“I have a way of ruining all my vacations by buying a piece of property and building something,” said Levine. “It’s a joke in the family, but that’s what happens.”
The parcel turned into a 55,000-square-foot, mixed-use development known as The Inn at Lost Creek, RAL’s first foray into the Telluride market. RAL, known for its projects in Miami and New York City, has since built a second hotel in the winter vacation destination.
RAL was ahead of its time. It will soon be joined in Telluride, a former mining town 200 miles southwest of Aspen, by Fort Partners and Merrimac Ventures, two Florida developers making their first venture into the frosty mountain market. Their arrival solidifies Levine’s insight about building in new markets for the exactly the same wealthy audience. Developers, and the luxury agents who sell the properties, are increasingly following these buyers to the markets where they seek fresh powder, sunshine and social life throughout the year.
“I think if you look at how much the real estate market has appreciated since 2010, especially at the top end of the market, and if you look at how many billionaires have been created – and how many hundred-millionaires – have been created in the last decade, we have that many more clients out there,” said Tal Alexander, co-founder of Official.
He and his brother Oren Alexander, who co-founded Official with the backing of white-label platform Side nearly two years ago, have been operating in the Miami and New York markets for years as the co-leads of a top team at Douglas Elliman.
Now they are about to open an office in Aspen, from which Oren Alexander will lead sales.
“It’s the platinum triangle,” said Tal Alexander: Aspen, Miami, New York.
The shape can always expand: the Alexanders also work in Los Angeles and Orange County, California, as well as the Hamptons.
“We wanted to make sure we were boots on the ground in those markets,” said Tal Alexander on branching out to those locations.
The impulse to build for this group has risks, particularly on the development side. Miami developers Ophir Sternberg and Ricardo Dunin lost millions trying to establish a luxury resort in Nicaragua. Developer Yair Levy tried to get a slice of the pie in Miami’s Diamond District, only to sell the property after defaulting on a $27 million construction loan.
“The real estate business is still a local business, at the end of the day, and very difficult to execute successfully,” said Bryan Cho, executive vice president at Related Companies, a developer with projects in luxury markets across the country, including New York, Los Angeles and South Florida.
“I think there has been interest from developers around the country to explore growth markets, but it’s not so easy, unless you have had sort of an office, a presence, some experience, years of building relationships,” he said.
Levine said RAL has those relationships. On trips, he studies where tourists visiting an area are from before deciding to develop: If the visitors are arriving from major cities, it’s a sign there’s a market for luxury properties. RAL also looks at how easy it is to get somewhere by plane, though sometimes a locale’s isolation adds to its value. Part of Telluride’s appeal, he said, is that it’s so far off the beaten path.
For agents, the trick is to know which markets are up and coming. Tal Alexander said he spent last July in St. Tropez, in part to celebrate his father’s 70th birthday, and in part to scout out the local market.
While having boots on the ground is important, developing an expertise in far away markets isn’t as difficult as it used to be. Filippo Incorvaia, founder of FI Real Estate in Miami, said he found comps online for his $16 million listing near Capri, Italy. He supplemented the research with calls to local brokerages.
Getting a foothold in distant markets comes down to word-of-mouth referrals, said Incorvaia and Alexander. Enjoying the same kind of lifestyle as their clients helps.
“My clients are like my friends,” Alexander said. “The way I live my life socially and professionally. … It revolves around my business.”