Yellowstone Club builds houses, strengthens local economy

Ultra-private club added estimated 975 construction jobs in 2011

By Taylor Anderson, Explorebigsky.com Assistant Editor

MADISON COUNTY, Montana — Contractors at the club
up the hill in Madison County were busy last year.
Thirteen houses busy, according to Yellowstone
Club vice president of sales Bill Collins.
“In the last six months, since May, 13 homes have
been completed,” Collins said.
Another 27 homes will be reviewed for approval
within the next six months, he said.
Money on housing projects like these creates
a trickledown effect that starts with local
designers and architects, moves to contractors
and their employees, and then to lumberyards,
raw material suppliers and local craftsmen. It’s
a long chain of economic activity that makes
its way around the region when new members
join, buy and build.
And while houses have also been going up elsewhere
around the region, the rate of development
hasn’t picked up nearly as quickly as in the club.
The flurry of building comes after two years of tumultuous
nationwide housing markets that didn’t
miss the Big Sky area or the Yellowstone Club.
The recent boom also follows the first two years
the club has been under new ownership that’s been
rebranding a once-tarnished name, while working
through the worst economic recession since the
Great Depression.
According to Collins, it feels that they’re well on
the way to recovery after the recession, and are
helping the area rebound, as well.
Local builders are in the middle of nine other resi –
dential housing projects, four of which are slated
for completion within the first weeks of 2012.
Home projects like these pump money into the
Madison and Gallatin county economies by adding
hundreds (at times as much as 1,000) of jobs, buy –
ing materials for sites from local lumberyards, and
providing a sizable piece of the Madison County
tax budget annually.
Andy “Cotton” Sarjahani lives in Bozeman and
finished a graduate assistantship at Montana State
last year working at a Community Supported Agriculture
farm.
Last month, the 28-year-old Arkansas native began
working as a laborer on a 15,000-square-foot home
in the Yellowstone Club with Teton Heritage
Builders. He enjoys the job and said it’s fulfilling
his needs right now.
“As long as I can pay the bills and as long as I’m
continuing to learn or there’s the opportunity
to learn, I’ll stay there as long as they need me,”
Sarjahani said.
He represents one of the hundreds of labor
workers assembling the houses that dot the
mountainsides in the Yellowstone
Club.
Tom Simkins, president of Simkins-Hallin Lumber
Co. in Bozeman, said that when the area took a
drastic dip from the construction boom of the early
2000s, his company suffered with it.
The company works exclusively with contractors,
including numerous builders at the club. Three
years after the growth rate began to lag in Gallatin
and Madison counties, Simkins says he’s sending
more building material through the canyon.

“Just the number of loads we take
up there, I haven’t broken it down
for the Yellowstone Club, but we’re
going up there more all the time,”
Simkins said.
The 13 houses constructed there
last year averaged 7,500 square feet, said Mike Ducuennois, vice president
of development at the club.
The average general construction
cost of each was $500 per square
foot.
Ducuennois estimates that string of
projects net $45 million in distrib –
uted proceeds, goods, services and
taxes throughout the area.
That kind of impact resonates well
with the governor.
“Those are Montana workers and
Montana businesses that are selling
goods and services and labor to
build those homes. That’s good for
the Montana economy,” Gov. Brian
Schweitzer said in an interview
with the Big Sky Weekly.
“Tourism and second home ownership
is a big driver in Montana. I’m
glad that the Yellowstone Club got
their finances figured out.”
From real estate agents, to masons,
landscapers, builders, electricians
and plumbers, an estimated 75
people were put to work on each
of the 13 homes. If that number is
applied to 2011 home numbers, 975
jobs were created.
“Currently I’ve got one, four, five,
six…go to nine, nine employees right
now,” said Jim Murphy, owner of
Continental Construction, which
builds at the club. “That’s carpenters,
cabinet makers, masons and administrative
help.”
Murphy continued work at the club
throughout the bankruptcy and ownership
transfer. He said the effects
don’t stop with his employees, but
percolate throughout the community
as workers spend their wages.
“Those guys are turning around and
spending money in the area too,
there’s a big uptick in activity,” he
said.
“During the concrete stage there’s
six or seven,” said an architect who
wanted to remain anonymous for
this story. “After framing, and when
you’re roughing in for plumbing and
air and installing windows and siding,
you could easily have 25 people
on that project.”
And while club homeowners pay
property taxes in Madison County,
many of the workers come from Big
Sky and Bozeman, due to the proximity
and lack of access to Madison
County.
Even with difficulties surrounding
the ownership transfer in 2009, the
club’s impact on the area made it
integral to keeping things moving
during the recession.
During peak months—summer
and winter—the club employs 560
people. Nearly 200 of those are full
time employees.
It was registered by Montana as a
Class 7 employer in the latest count
in June, meaning it can put up to 499
people to work. It has previously
been registered a Class 8 employer,
creating up to 999 jobs during peak
months.
Together with Big Sky Resort, the
Yellowstone Club is the top employer
in Madison County. The
two resorts are within the top 100
employers in the state.
“In turn, we take that responsibility
very seriously,” Collins said.

__________________
A cycle of changes
Since the economic downturn,
the club has tried to address trend
changes in building styles head on.
Homes and buildings that were
built five or six years ago displayed
an air of opulence that also garnered
waste.
And although the homes and
amenities being built at the YC are
still large, they’re 30 to 40 percent
smaller than those that went up in
its early building stage, Collins said.
The current owners see themselves
as stewards of the land, and keep in
mind the 900,000-acre Lee Metcalf
Wilderness surrounding them, he
added.
They’ve encouraged implementation
of green building techniques, and
some owners have installed geothermal
heating and cooling pump
systems. THB Energy Solutions is
working on several of these projects
at the club, which can save up to 500
percent efficiency versus propane,
said THB’s Parker Thompson.
The club has also moved to lessen its
pattern of propane waste by keeping
fewer driveways, porches and swimming
pools heated on its grounds.
The club would need to continue this
new boom if it were to come close
to reaching the hundreds of added
houses it would take to reach capacity.
“We’ve been selling quite a bit of
land, and that land is ultimately built
upon,” Collins said. That cycle could
continue until there is the potential
for 864 front doors within the 13,600
acres the Yellowstone Club is allowed
to develop.
Since its new owners took over in
December 2009, the Yellowstone
Club has made about $300 million in
sales, and increased by 50 members,
Collins said. Those sales include land,
new houses and existing homes.
“We’re adding amenities to compete
not only in this market, but for when
we come out of this market,” Collins
said. “We’re investing in the future,
versus hanging on for dear life.”