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Taking A Swing At A Private Course
GRAND RAPIDS — Despite a sputtering economy, West Michigan businessmen Jeff Brown and Brad McGinnis believe they have found a niche in a Michigan market that has seemingly hit the point of saturation over the past 10 years.
New golf course construction. Up north.
Another new golf course? In northern Michigan?
Brown and McGinnis, co-managing partners of Harbor Springs Development LLC, claim to have the business plan for success.
It is called True North.
The property is located near the pinnacle of the golf course resort haven in Harbor Springs, in close proximity to the upscale golf facilities at Boyne Highlands and Bay Harbor.
But this plan has a slightly different twist. True North is going to be a private club with limited housing available to members and property owners.
Public courses outnumber private courses nearly 10-to-1 in Michigan, and construction ratios over the past 10 years have exceeded even that number. Brown said that a private club setting in a wooded timber community makes sense in the area renowned for tourism.
"We didn't do this based on an emotional decision just because we wanted to build a golf course," said Brown, who grew up in Harbor Springs. "It is totally business driven. We took all the emotional decisions out of this thing and based it strictly on business.
"We know there is no lack of upscale public golf in this area. We are going to be a small, private club with small, private housing. And that is what is lacking."
The $10 million project will include an upscale private golf course and 72 home sites on the 320-acre layout near the tip of Michigan's Lower Peninsula. The area — complete with hills, forests and lakes — is attractive for vacationers, golfers, skiers, bikers, boaters and hunters.
"It is a beautiful piece of property," Brown said. "We know it will work because there is a niche in the market."
And it is located in a popular place to vacation and/or reside.
In a recent edition of Barron's magazine, Harbor Springs — located on Lake Michigan's Little Traverse Bay — was named one of the top 20 retirement spots in the world because of its "great boating and golfing ... secluded properties ... ski resorts nearby."
A feasibility study was conducted and based on 150 potential memberships costing between $16,000 and $20,000. The real estate portion wasn't figured into the equation.
"We wanted to make sure the golf course could stand on its own," Brown said. "Those who play it over the first three years will have a private club experience."
The 320-acre site was part of an estate property that Brown purchased five years ago. He estimates that the value has increased three times since the original purchase.
The 72 lots are all at least one acre in size and available for building what will become a single-family, timber-framed community, according to Brown. Ten founding members paid $100,000 for their lots and a lifetime membership to the golf club. Ten additional founding member sites will be sold as well, according to Brown.
The founding-member concept provides the needed startup capital for the developers and provides those buying in with a lifetime membership and a selected lot on the site.
"As far as the economy is concerned and where it is right now, people are looking for tangible investments and are talking about their futures and lifestyles," Brown said. "Real estate is tangible. You buy it and you own it, and that's what people are interested in right now.
"And, it's Harbor Springs. Harbor Springs investments do not go down in value.
"We're five miles from the lake, five miles from (Petoskey) and five miles from skiing."
While initial golf memberships will range from $16,000 to $20,000, lot prices for the one-acre plus single-family home sites are priced between $100,000 and $159,000.
All the home sites are within walking distance of the clubhouse, according to Brown.
The developers are so committed to the project that they brought in a heavy hitter to back their beliefs. Denver-based and internationally renowned Jim Engh, who designed award-winning Tullymore near Canadian Lakes, was hired on to design the golf course. Brown and McGinnis said they chose Engh because they wanted a rising star whose work is relatively new to Michigan.
"It's a tremendous site with topographical changes, gullies and vegetation that can be fairly dramatic," Engh said. "The courses we've done in the mountains have acclimated us to work in more rugged terrain, and the golf course at True North sits in the more rugged terrain of the property."
After getting zoning board clearance, ground was broken this fall with major earth-moving taking place. Construction, shaping, seeding and irrigation will take place in the spring of 2003, and Brown and McGinnis project an opening in the spring of 2004.