LochenHeath on the Rebound: New cottages part of the plan to go private again

LochenHeath – the exclusive waterfront golf development on the shores of East Grand Traverse Bay – could soon become a private golf club again. Owners have greenlit construction of upscale “statement” cottages on the course, which could be a key step in attracting outside members – and returning the club to its original luster. Construction of two of the planned seven cottages is underway; they should be open and available for rental by visiting golfers for this upcoming summer season.

In the years since its 2001 inception, LochenHeath has experienced the loftiest of highs and some pretty deep lows. In 2004, Arizona-based Pinnacle Development Group trumpeted “one of the upper Midwest’s finest private residential and golf communities,” with plans to develop 600 acres into a private community with up to 400 home sites, some for as much as $2 million each. Wining and dining prospective buyers from around the world, Pinnacle had the pedigree, having developed Estancia and Seven Canyons, two acclaimed private golf clubs in Arizona. LochenHeath seemed destined for greatness, eventually landing on “best of” lists from the likes of Golfweek and Golf magazines for its golf course.

But then 2008 happened. Too many golf courses, a freefall in real estate prices, and an economic collapse eventually led to Pinnacle defaulting on $120 million in loans and losing LochenHeath to the bank in foreclosure. The course was shuttered and employees were laid off, leaving the greens and fairways to go fallow. Homeowners who had built multi-million-dollar homes on the property were left to wonder about the future.

By the end of 2010, 12 of those homeowners had banded together to negotiate with the bank and eventually purchase the golf club as a home owners association (HOA), separating it from the remainder of the undeveloped property. Al Ruggirello, an original homeowner and the president of the HOA board, says those were dark days.

“I remember in November 2010 walking out on the course,” he recalled. “The weeds were overgrown, the fairway grass was 15 inches of mud. Really. It certainly was a low point, and we were that close to losing it.”

Homeowners pitched in not only their money, but also their labor. That winter, they met on the course, shoveling and weeding and working to save what had been – and perhaps could be again: a great golf course.

Ruggirello said the owners knew they’d have to open the course to the public to make it viable in the short-term, but that “the owners’ vision was always to become a private club [again].”

In 2013, the club hired Kevin O’Brien as general manager. O’Brien had a track record in the world of golf operations, having brought three separate clubs to national prominence over a 25-year career.

“I came on in 2013 to transition back to private,” said O’Brien. “We figured a seven-year plan, and 2018 is year six. We’ve been building brand, and now Golf Digest has validated our property [LochenHeath labeled as a ‘Best in State’ course].”

Ultimately O’Brien envisions a membership mix of roughly 70 percent resident members living on site, and 30 percent national members who live elsewhere but maintain rights to golf when they come to town. National members will pay $1,600 annually, while resident members pay $3,300; all members must pony up a non-refundable membership deposit of $6,000-$14,000.

There are 90 members today, and Ruggirello said adding new ones is the top priority.

“Everything we do, we ask if we are doing it toward our main goal: membership,” he said. “But to sell national memberships, you need lodging on-site. Often the players will bring their associates or friends to stay for a weekend for a full golfing and lodging and dining experience.”

And so the cottages represent the next step in LochenHeath’s evolution.

“The concept is high-end cottages,” said Ruggirello. “Because we’re golfers, we know what people like to have: a comfortable setting, a good shower, a nice place to watch TV or play games, a beautiful kitchen, en suite bathrooms, all connected for larger groups.”

Each cottage will be 2,500 square feet with four bedrooms, two of which will have lockouts for individual rentals. J. Scott Smith rendering

After a bid and review process, LochenHeath owners selected Acme-based MapleRidge Construction to build the first two cottages (Acme Township has approved up to seven). Partners Chris Miller and Scott Naumes of MapleRidge have erected homes in Glen Arbor, Torch Lake, Bay Harbor and several within LochenHeath, including Ruggirello’s, who noted that they’re “known for their quality and workmanship. We know what we want, but they know how to get us there.”

The two initial cottages are expected to cost $1.8 million to build.

“They will complement what we have here in terms of the whole development, but we want these to be a statement when you pull into LochenHeath,” said Ruggirello, who added that the team next sought just the right designer for the project.

As luck would have it, Shane Inman, the self-made residential interior design specialist who’s been doing high-end custom work in New York, had just returned to Traverse City. “He understood the whole thing with membership and image,” said Ruggirello.

Club GM Kevin O’Brien and designer Shane Inman

O’Brien agreed. “It wasn’t just interior design,” he said. “It was the knowledge he brought to the project.”

Inman signed on to the project in September, and has no shortage of ideas and vision for the Cottages at LochenHeath.

“I was very intrigued [by LochenHeath] back when I started my company 15 years ago. I really wanted to be a part of it. So I was very interested when I returned, and I thought my brand runs parallel with theirs, so I would love to have this be my first project back,” he said.

Each cottage will be 2,500 square feet with four bedrooms, two of which will have lockouts for individual rentals, providing maximum flexibility depending on the size of the visiting groups.

They will be Shaker style with metal roofs, complemented with stone work and carriage lights to mirror some of the existing LochenHeath buildings. Inman said the cottages need to be welcoming but still feel like they belong in LochenHeath.

“They’ll be decked out, beautiful, with some custom furniture. They’ll have 21st Century floor plans, but will be timeless and classic,” he added.

So beyond the cottages, what’s next? Expect the transition to a private club to continue. O’Brien says fewer rounds of public golf have been made available each summer, and that trend will continue in 2019 and until eventually the course is private.

Also expect more growth, according to Ruggirello.

When asked about his vision for what LochenHeath might be in 2025, he outlined several key points.

“Private. The best views of the bay. By then hopefully a new clubhouse, with lodging or workout facilities above or parking underground,” he said.

With respect to its past, Ruggirello said there are “good things” to come.

“You know, LochenHeath got a bad rap for a long time, and the previous owners hurt a lot of people,” he said. “But there’s been a lot of good things happening here too, with much more to come.”


The LochenHeath Timeline

2001 – Golf course on former Maitland farm completed

2004 – Pinnacle Development Group announces plans for ambitious private club; lots for sale close to $2 million

2004-2008 – Approximately 90 lots sold; some homes built

February 2008 – Course is closed; Pinnacle defaults on loan

December 2010 – Syndicate of 11 Lochenheath homeowners purchase golf club from bank

2011 – Golf course reopens for public play

2016 – Australia-based Drapac Group purchases remaining non-golf property

2018 – Golf club announces development of cottages, intention to go private again