Park City Property Management Crimes(?)

            Two years ago two leading Park City, Utah property management companies went out of business.  Their downfall led to many unpaid bills to local vendors, employees, local government entities, and owners of the properties that the companies managed.

             The Summit County attorney recently determined that according to the laws of the state of Utah, the firms did nothing illegal in not paying home and condominium owners their share of rental revenues. The Summit County attorney was quoted as saying "It was bad business practices. Horrible decisions were made, but it was not fraud." The law in Utah and the contracts signed by owners allow for the co-mingling of funds and code leaves the oversight of nightly rental managers to local Park City authorities. Many other states require that the owners' revenue share of nightly rentals be placed in a trust account, but not so in Utah. Local Park City authorities as well as Utah lawmakers have no plans in changing the current laws.

             One of the local property management companies quietly went away while the other has been the object of much ill will and speculation as to where the money went. The bankruptcy of Premier Resorts of Utah (doing business as: Deer Valley Lodging (not associated with Deer Valley Resort)) left homeowners and creditors with unpaid bills totaling $13 million. Funds from collected rent may have gone to support operations in other resort communities in the country. Since the company did not hold real property or many assets, it appears that most of the creditors will go unpaid as the bankruptcy concludes. Premier Resorts of Utah owners have been "tight lipped" about where all of the money went. It appears (according to the Summit County attorney) that while what happened was criminal, it was not illegal.

             The YouInParkCity.com group encourages Park City condominium and vacation home owners interested in renting their properties nightly to carefully read property management and nightly rental contracts thoroughly before placing their properties into rental pools. Be sure to understand not only splits, fees, rental rotations and possible revenue sharing or equalization strategies; but also how the property will be marketed and how and when revenues will be dispersed. Consult your attorney with any questions about the contract.