April 19th, 2013 by Justin Winter Posted in Real Estate Commentary | No Comments »
By Dick Hughes – Upstate Business Journal
The new owners of the Cliffs Communities are building clubhouses for the two exclusive Cliffs Communities, Mountain Park and Keowee Springs, that don’t yet have them. Unlike the ostentatiously large buildings characteristic of clubhouses at the five other communities, these clubhouses are smaller, more typically Southern and more harmonious with the environment. The clubhouses at Mountain Park and Keowee Springs reflect the restrained approach of the partnership formed after the club entity of seven of eight Cliffs communities in South and North Carolina came out of bankruptcy in August. The new owners are aware of the devastating toll a collapsing real estate market visited on exclusive golf communities like The Cliffs, coinciding as it did with the overbuilding of golf-linked luxury homes while golf was in decline. “What we have to get away from is the huge grandiose plans that people had in the past,” said Brett Johnston, CEO of Cliffs Land Partners. “They are not sustainable. Our plan is to build sustainable buildings useable today.”
Cabin in the Woods In addition to completing the Gary Player Golf Course for play by September, the new owners are building a 4,000-square-foot clubhouse at Mountain Park in contrast to the more formal 20,000-square-foot clubhouses in other communities. “The idea is to have it be like a cabin that has been in the woods forever,” said Johnson. “It is going to be rustic, but nice. The food will be casual. It is going to be indigenous to the area, Southern mountain.” At lakeside Keowee Springs, which has a Tom Fazio course but had no clubhouse, the former home of the International Institute of Golf is being refitted as a clubhouse with its Southern porch, rocking chairs and casual food. The pro shop for the Tom Jackson-designed course at The Cliffs at Glassy Mountain, the first Cliffs golf community to be built, was rebuilt, and 350 people showed up for its opening, said Davis Sezna, CEO of Cliffs Club Partners. In all, $8 million in amenity improvements are currently underway.
More than Tees and Greens “You are going to see a lot more amenities like bike trails, outdoor fire pits, a lot more of the social infrastructure rather than big clubhouses. Those are things of the past,” said Johnston. “We’re really raising the bar throughout all the communities with culinary,” he added. Still, golf remains a major attraction, and the owners expect the Player course to create considerable buzz in the golf world and be a draw for Mountain Park. “When a golf course opens to great acclaim, we all want to go,” said Sezna. “We don’t care how far or where it is, we find a way of getting there. I believe this course will attract this kind of attention.” The acquisition by cyclist George Hincapie and his brother, Rich, of La Bastide, which had been owned by Cliffs founder Jim Anthony, has been a “wonderful addition to the neighborhood,” said Sezna. This week, the Hincapies announced that the property will reopen soon as Hotel Domestique. “When you tell people they can go out for a ride with George Hincapie, they are just amazed,” said Sezna. “It is more than cycling. It is a legend.”
Greenville Office Pays Off Johnston said that the storefront sales office on Main Street in Greenville also has helped raise awareness. “We get people walking by, stopping in. We can track a couple of sales that came through this office.” A master plan is in the works for on-going capital investment over the next decade. The plan takes into account the lifestyle interests of existing property owners and potential buyers, Johnston said. “The Cliffs has always been known for golf, but, as we go forward, we’ll find fewer people mention golf because there are so many other reasons to be at The Cliffs. So many things are happening with food and beverage and what we are doing with wellness.” Sales activity picked up last year with more than $80 million in property transactions. Johnston expects even more sales this year.
Adjusting to Reality “We get most of our people through our website,” Johnston said. “The buyer today is extremely educated. When they walk in, they already know what is out there and what things are selling for.” Sensitive to the realities of today’s market, the costs of entry into the lifestyle are lower, relatively speaking. Home sites start at $100,000, half what it was in the high-flying pre-recession days. Homes range from $500,000 to $4 million. The up-front initiation for golf membership was reduced to $50,000. It had been as high as $125,000. Monthly fees range from $865 for full access to any of the seven courses to $778 for home golf privileges and $692 for non-residents. There are lower monthly dues for wellness, non-golf sports and social activities. Johnston said memberships have increased more than 30 percent from 1,920 in prerecession days to 2,600.
Raw Land for Conservation? Seventy-seven homes are under construction, and the company is recruiting and vetting builders to have five or six preferred builders for each of three regions – lake communities and mountain communities near Greenville and Asheville. Silver Sun Partners, the umbrella group that owns the clubs and most of the land and which Johnston and Sezna work for, anticipate developing 2,000-3,000 more home sites over eight to 12 years, leaving “several thousand acres of raw land” that could be developed for another 1,000 or more home sites. “But,” Johnston said, “I don’t see us ever fully developing everything. We might put some of the land in a conservation easement.” When things were on hold, at best, followed by the uncertainty of bankruptcy, Sezna said, property owners “went through a traumatic time” but now “are excited and ready to roll again, chanting, ‘The Cliffs are back.’”