Tuesday, August 22, 2006

Canyon Ranch Living Project in Bethesda on Hold

The Canyon Ranch concept may have hit a snag in its march into Maryland. A combination of increased mortgage rates, and increased construction costs have caused the $1 billion dollar project in Bethesda to be put on hold for 30 days.

But is there more to it? Canyon Ranch Living aims to provide a kind of hermetically sealed environment in which residents live in condominiums, above dietetically-correct restaurants and health spas.

As the company webpage says about its on-hold Maryland project: "Imagine a spectacular home that’s also an experience. At Canyon Ranch Living – Bethesda, everything comes together to bring out the best in you – the all-healthy environment of renowned Canyon Ranch, luxuries at every turn, and the nation’s finest urban village."

In other words – imagine the experience of what Canyon Ranch calls an "urban village" - right off of I-270 and Old Georgetown Road on 53 acres owned by the Camalier family, one of the largest private development companies in the region.

Imagine feeling just like you really do live in a city; without ever having to bother with actually living in a city.

As one analyst, familiar with the real estate market on the east coast put it: "This isn’t California or Florida; status in the DC area is driven by your connection to the government or wonky group, not really where or how well you live. There is a market for holistic living as a social status symbol – it just isn’t the DC region."

The Canyon Ranch Project is part of a partnership arrangement between Canyon Ranch and the Penrose Group, of Tysons Corner. Canyon Ranch would receive up front payments and management fees to run the development.

Jan McIntire, Senior Director of Corporate Communications for Canyon Ranch has a different view and says the feedback they’ve received from their guests confirms a viable market in the Bethesda area.

"Knowledge of what our guests who live in and around Bethesda want and expect from Canyon Ranch Living makes us feel confident we’re on the right track."

That view is supported by a veteran real estate agent of the DC-area development boom who sees the Canyon Ranch project as a potential success based on the demographics of the area, but possibly a victim of rising costs in construction and the rise in mortgage rates.

"It’s a successful model," said the agent, "there are a lot of people who do want that feeling of being in an urban environment but without the hassle and they want the amenities; the spas, the holistic approach, the restaurants."


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