South Street Partners bought the seven communities that dot the South Carolina and North Carolina mountains. Managing partner Patrick Melton sees a niche focusing on higher-end golf-themed communities.
The Cliffs collection of high-end golf communities in the Blue Ridge mountains has been sold to a Charlotte, N.C. investment firm that promises long-term financial stability—though the sale won’t speed the development of a long-shelved concept associated with Tiger Woods, The Greenville (S.C.) News reported.
The seven communities in the South Carolina and North Carolina mountains were bought by South Street Partners, which owns, develops and manages high-end club communities, including the Kiawah Island community south of Charleston, S.C., The News reported.
The investment is the latest chapter in a long, up-and-down history for the properties that began in the heart of the golf community real estate craze, which started its decline in the years leading up to the Great Recession, The News reported.
However, South Street managing partner Patrick Melton told The Greenville News in an exclusive interview that the firm believes the future of golf communities lies in the niche that has survived the decline of the heady days of the 1990s, when local developer Jim Anthony marketed his grand vision for Cliffs-brand mountaintop communities partnered with courses designed with golf pros.
The boom of golf course development that reached its nadir just before the recession included courses that were ill-conceived or served a market that hasn’t proven to be sustainable, The News reported. At its peak in the mid-2000s, golf course real estate was a $14.9 billion industry, but today U.S. sales average about $9.3 billion, according to the World Golf Foundation.
Today, the niche within the development of golf-themed communities is in focusing on higher-end properties, Melton told The News. A number of developments that have struggled involve public courses, nine-hole courses, lower-fee models and poorly situated locations, he said.
“We’ve gone through this process almost like a shakeout,” Melton said.
The Cliffs features seven communities — The Cliffs Communities at Mountain Park, Valley, Glassy, Keowee Springs, Keowee Falls, Keowee Vineyards and Walnut Cove, The News reported. An eighth concept, High Carolina near Asheville, which in 2007 was to partner with Tiger Woods for course design, is still on hold.
The sale won’t expedite the development of High Carolina, said South Street partner Chris Randolph, who is based in Charleston and focuses on the Kiawah development, The News reported. A partnership with Woods isn’t off the table, Randolph said.
“At the right time, it will be an incredible opportunity,” Randolph said. “[Woods] could be part of it, but we’re not sure which direction it will head because there are a number of different options.”
In the early 2000s, the vision Anthony had with nearly 1,800 acres of land along the South and North Carolina border was progressing full steam with courses designed in concert with the likes of Jack Nicklaus (Keowee Falls and Walnut Cove), Tom Fazio (Keowee Vineyards and Keowee Springs) and Gary Player (Mountain Park), The News reported. When the recession reached its depths, Anthony went bankrupt. In 2012, Silver Sun Partners took over. Florida-based Arendale Holdings bought the properties in late 2013 and has owned them until South Street’s closing late Thursday night.
Over the past 10 years, South Street has been wanting to get into the Blue Ridge market and first looked at the Cliffs during the recession, but Melton said the company was brand new and it didn’t appear the market [would] recover soon enough to warrant investment, The News reported.
The firm will focus on improved amenities in two particular communities—Keowee Springs and Mountain Park, The News reported. Also, an approach that has worked in the Kiawah development—”built for sale”—will be employed at Cliffs properties. The concept involves moving away from selling empty lots for custom-built homes to offering pre-conceived floor plans and homes already built, which Randolph said has become a trend in which owners are less concerned with customization and more interest in a turn-key purchase.
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