Each member will be assessed a one-time fee of $16,500, which will be the only contribution ever required of them.
Members of the Desert Mountain Golf Club in Scottsdale, Ariz., have completed a deal with owner Crescent Real Estate Holdings to purchase the club’s six golf courses, all related facilities and about 500 acres of developable land for $73.5 million, reports the Arizona Republic.
The deal expands on an agreement in the Desert Mountain membership contract that would have required members to buy the club’s six golf courses and clubhouse facilities on March 1.
Member representatives described the expanded deal as an insurance policy against future changes to the club and its surrounding community of multimillion-dollar homes.
Of particular concern, they said, was the large swath of adjacent land, which Crescent ultimately could have sold or developed for any number of residential or commercial projects.
Of the roughly 2,300 members, 90 percent cast votes, the club’s managers say.
Desert Mountain members’ bigger concern, according to club President Bob Jones, was making sure the community’s vacant land would be developed for purposes that benefited the club and not just the property’s owner.
To make the deal work financially, Jones and other representatives of the buyers’ group obtained financing for a portion of the purchase price.The upshot of that decision was that instead of each member paying an expected $50,000 over many years via fee increases, each member was assessed a one-time fee of $16,500, which Jones said would be the only contribution ever required of them.
He added that the group performed extensive due diligence before agreeing on the purchase price. The club has turned a profit every year since 2003, Jones said.
He said that the final negotiated price was about one-third of the seller’s original asking price.