San Marcos Mercury | Local News from San Marcos and Hays County, Texas

January 6th, 2011
Kyle golf club faces possible foreclosure

Since acquiring Plum Creek Golf Club in 2008, Missouri-based Middleton Properties has spent $2.1 million on improvements including a new 10,000-square-foot clubhouse. The course’s owner faces foreclosure on the property after La Jolla Bank was shut down by federal regulators. (Photo by Sean Kimmons)

by BRAD ROLLINS

The owner of Plum Creek Golf Club is fending off the threat of foreclosure after its bank was shut down by federal regulators and a new note-holder called in outstanding debts.

Arcadia, Missouri-based Middleton Properties bought the 18 hole, 195-acre course for $3 million from San Diego-based La Jolla Bank in March 2008 as part of a deal that included three other golf courses, Cypress Lake Golf Club in Houston and two properties in Indiana.

Given the property’s troubled history – La Jolla owned the course as the result of a previous foreclosure against former owner Mountain City Golf Inc. – Middleton negotiated a two-year grace period to bring the Kyle facility back into the black, said David Curwen, the club’s general manager and golf pro.

But in February, the Federal Deposit Insurance Corp. closed La Jolla, saying its “financial management had rapidly deteriorated” and that the bank risked failure because of “significant losses in its acquisition, development and construction loan portfolios,” an FDIC spokesperson said at the time. Pasadena, Calif.-based OneWest Bank entered into a “loss-share transaction” of $3.6 billion in assets, including Middleton’s four golf clubs.

Middleton Properties is trying to negotiate an arrangement for keeping the property and Curwen said he did not know if or when the bank will foreclose.

“I’d like to be able to predict the future but in these economic times, it’s just hard to say,” Curwen said. “…I don’t know where the negotiations are going to go and I don’t know what thinking process [the bank] uses. If they’re going to try to sell the course to recover the mortgage, it’s not going to get anything for them.”

Top-rated courses are idling on the market for less than $2 million, Curwen said, and it’s unlikely that the sale of Plum Creek would fetch anything approaching the $3 million Middleton paid for the property two years ago. The property is less valuable, he said, because it can only ever be used as a golf course because of deed restrictions, he said.

Traffic at Plum Creek held steady in 2010 at about 25,000 rounds, Curwen said, and Middleton has invested $2.1 million in improvements including construction of a 10,000-square-foot clubhouse that opened in August 2009 and extensive irrigation system improvements.

The course’s financial recovery, however, has been hampered by a glut of golf courses nationally, Curwen said.

“Golf courses got way overbuilt in the 80s and into the 90s and the market just doesn’t sustain it” during an economic downtown, Curwen said. “It’s a luxury. Once the economy starts dipping down, people start dropping luxuries.”

Email Email | Print Print

--

3 thoughts on “Kyle golf club faces possible foreclosure

  1. This is no surprise. They need to fire the guys working there that don’t do anything and are just there for the free golf. The pro is a joke as are the assistant pros. Get a person in there with half a brain and the place would do fine, sadly nobody working there has half a brain or knows how to treat customers. There is zero customer service there.

  2. Obviously nobody is worth a darn except Carl Nissin.
    There are only 3 guys that work there for free golf, and one of them works only 1 day per week – and he works very hard fixing the damage done by golfers who don’t take the time to repair their divots or pick up their broken golf tees (not to mention the cigarette butts and empty beer cans). Of the other 2 “free” golfers, one is a college student who works there part-time. He works very hard, and from what I have seen, he has a very good relationship with the members and other customers. The 3rd part-time worker is a retired guy who works only about 10 hours per week bringing carts from the cart barn for players to use, and cleaning those same carts when players have finished with them. You would not believe how trashed-out some of those carts are when they are returned – those players’ mothers would be ashamed of their sons. And some of the players finish with carts covered with bunches of empty beer cans – and then they go to their cars and drive away – not sober for sure.
    If Carl is unhappy with the staff at Plum he certain has the right to bring up his issues with the general manager.

Leave a Reply

Your email address will not be published. Required fields are marked *

:)