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tim blixseth, Yellowstone club, timothy blixseth
Bozeman Chronicle/Erik Peterson/AP
The Yellowstone Club in Virginia City, Mt. is seen March 11, 2008.

Exclusive Yellowstone Club Is $343 Million in Debt

November 13, 2008 12:30 PM
by Lindsey Chapman
On Monday, the Yellowstone Club resort in Montana filed for Chapter 11 bankruptcy protection after difficult credit markets made it hard to repay debts.

The Yellowstone Club

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On Nov. 11, a private club for some of the world’s most wealthy people filed for Chapter 11 protection. The Yellowstone Club, whose members include former Vice President Dan Quayle and Microsoft cofounder Bill Gates, owes $343 million to creditors and contractors, the Associated Press reported.

According to the club’s bankruptcy filing, credit markets made it tough to raise the money to pay off its debts and make repairs to the resort. In fact, the Yellowstone Club was planning a sizeable expansion when the credit crisis struck Wall Street, “demonstrating that even some of the elite are not escaping the nation’s economic woes,” the AP stated.

According to Forbes, Tim Blixseth, who founded the club with his wife Edra, tried turning the Yellowstone Club into a worldwide operation when the real estate market began stagnating. He purchased a chateau in France, a golf resort in Scotland, a villa in Mexico and a Caribbean estate.

The Blixseths are also accused of using club money to buy personal items, including a $44 million Gulfstream jet, and vehicles like two Rolls-Royces and a Porsche Cayenne.

Tim and Edra were engaged in a bitter divorce battle earlier this year. As part of the divorce settlement, Edra took over Tim’s 50 percent ownership in the Yellowstone Club.

She has tried selling some of the international property since taking control. Forbes quotes Ms. Blixseth as saying the bankruptcy filing “was necessary to address short-term liquidity constraints and preserve Yellowstone Club’s long-term future.”

Mr. Blixseth has denied that the purchases “left the club financially exposed,” the AP reported. He also said he has “not been in the loop” about the club’s finances since his divorce was finalized.
 
In its “heyday,” prospective members of the Yellowstone Club were required to show that they had a net worth of $3 million, pay a $250,000 initiation fee into the club, dish out $16,000 in annual dues and purchase property. Average lots in the 13,400-acre club are two acres and cost $1.4 million.

Key Player: Tim Blixseth

In 2007, Tim Blixseth announced that he was building what would have been the world’s most expensive home near Bozeman, Mt. He said the 53,000-square-foot complex, to be called “The Pinnacle,” would include a private ski lift, a heated driveway and an indoor-outdoor pool. He planned to put the home on the market for $155 million. But for reasons never fully explained, Blixseth never started construction on the home and sold the 160-acre parcel where he’d planned to build.
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