Development Hopes To Lure HighEnd Travelers

June 24, 2002
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DOUGLAS — An untapped market for providing high-spending travelers a five-star place to stay when they come to town has lured a Chicago investment group to undertake the development of a $30 million luxury hotel and condominium project.

The art galleries, high-end shopping and other attractions of the Saugatuck-Douglas area are what draw many affluent travelers to the resort area. Those same amenities attracted developers from Chicago who want to cater to the upscale crowd.

“They know the area is very much a destination from Chicago,” said Karen Smith, marketing director of the Saugatuck Lodge in Douglas. “The types of retail businesses that are here are already attracting the right people for the right places.”

The Saugatuck Lodge, a unique development to the area that consists of a luxury hotel and surrounding condo-style villas and cottages, is planned for acreage just off the downtown area in Douglas, across the Kalamazoo River from Saugatuck. The site along Blue Star Highway is where the Tara Restaurant, a former landmark that closed more than two years ago, was torn down in June.

The primary focus of marketing efforts behind the 32 villas and lodges that will accompany the 72-suite Saugatuck Lodge hotel is affluent Chicagoans who are regular visitors to the Saugatuck-Douglas area and may want a permanent vacation home in the resort community.

“They’ve already been coming to Saugatuck, they know Saugatuck and they’re interested in having something close to home so on a Friday afternoon, if they feel like getting in the car, they know where to go,” Smith said. “We are really trying to market not just the building and not the investment, but the lifestyle.”

The hotel will feature a business center equipped for business travelers, a restaurant and lounge, a landscaped outdoor pool and dining terrace, a health club and spa, banquet and private meeting rooms, DVD rentals and 24-hour room service.

Smith hopes the hotel will become the place for high-end leisure and corporate travelers coming through West Michigan, as well as an elegant setting for locals to hold a wedding reception or to host corporate retreats and business meetings.

The villas and cottages — consisting of eight, four-unit buildings on the perimeter of the property — will share the lodge-style design and feel of the hotel. Owners of the villas and cottages will have access to all of the hotel’s services. Villas are available for $445,000 to $465,000. The cottages go for $365,000 to $385,000.

Buyers can acquire a cottage for their exclusive use, or buy a fully-furnished villa that hotel management, for a share of the revenue, will lease out when the owner is away to generate an investment income.

To date, the backers of the project — The Churchill Group, a Chicago-based real estate development, management and investment company — have sold two of the villas and received deposits on six others, Smith said. She also will market the villas to corporations to use for visiting executives or for employee incentive programs, she said.

Helping to attract individual buyers is the potential to generate an investment income, as well as enjoy the comforts and amenities of the hotel that go with the villas and cottages, said Jeff Wilcox, an associate broker and manager of Woodland Real Estate’s Saugatuck office who’s listing the properties.

“The owner is buying into a relatively intimate setting,” Wilcox said. “They get the difference in the concept and that it hasn’t been done here before.”

Construction on the Saugatuck Lodge is scheduled to begin in January. Completion is targeted for late 2003.

The owners also will seek to develop ties with the local businesses, with golf packages to area courses and concierge services to the art galleries, specialty retail stores and activities and attractions in both communities, Smith said.

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