BajaNomad - A Baja golfcourse scam?

A Baja golfcourse scam?

wilderone - 6-22-2009 at 09:52 AM

A lawsuit claiming that developer Ken Jowdy made off with $25 million that was supposed to be invested in a sprawling Mexican golf resort. The plaintiffs in the suit, filed in Los Angeles Superior Court, include nearly two dozen National Hockey League players. They're asking for their $25 million back and another $15 million in damages.
The golf resort in question is Diamante Cabo San Lucas, a 1,500-acre property overlooking the Pacific. Two courses are planned, one designed by Phil Mickelson and the other by Davis Love III.

http://deadspin.com/5296568/financial-scammer-robs-nhl-playe...

tripledigitken - 6-22-2009 at 10:07 AM

Isn't that the same outfit that has plans for a course near El Rosario?

Bajahowodd - 6-22-2009 at 11:21 AM

Exactly! The Diamante Del Mar project. The one that this latest lawsuit is about concerns property that is located on the Pacific side North of Cabo. According to the NY Post, one or both of these projects is seven years behind schedule. The lawsuit involves the Cabo project. There is supposedly already a warrant for Jowdy's arrest in Mexico. That sorta put the damper on working there, eh?

arrowhead - 6-22-2009 at 11:50 AM

Real estate fraud in Mexico? Who knew?

Well, the good news is that the fallout from this and other highly public fiascos, like Trump Baja and Loreto Bay, will probably kill off what little chances Punta Brava ever had of being a real project.

CaboRon - 6-22-2009 at 12:42 PM

Quote:

Originally posted by arrowhead
Real estate fraud in Mexico? Who knew?

.

Cypress - 6-22-2009 at 12:47 PM

Golf is a scam. :lol:

BajaNomad - 6-22-2009 at 02:44 PM

Quote:

Originally posted by Bajahowodd
Exactly! The Diamante Del Mar project. The one that this latest lawsuit is about concerns property that is located on the Pacific side North of Cabo. According to the NY Post, one or both of these projects is seven years behind schedule...

Slight background - see my note here posted in March '07 from information I received in November '06:

http://forums.bajanomad.com/viewthread.php?tid=23281#pid2116...

[Edited on 6-22-2009 by BajaNomad]

wilderone - 6-22-2009 at 04:48 PM

Legacy Properties (who is behind the Diamante del Mar project) website, lists the Cabo project, and also two US golf resorts, including one called Laurel Cove in Tennessee. The Laurel Cove project went belly up in October 2008, and is on hold indefinitely, with the clubhouse and the usual half finished, no homes started. They had a $121 million construction loan and the funding went bankrupt, millions in construction liens filed. El Rosario never got started. Adios, Legacy Properties. Millions of dollars wasted again.

Bajahowodd - 6-22-2009 at 04:53 PM

But let's not forget those folks who made a fortune in the process. Another heart touching story for capitalism uncontrolled.

GOLF IN DECLINE

bajajazz - 6-22-2009 at 06:47 PM

I am sure I have read -- but can't recall where -- that golf as a participant (not spectator) sport is in decline in general, all over the United States. Apparently, the time and money it takes to play a round of golf are becoming prohibitive, and I imagine the economic downturn has aggravated this situation. If this is true, it reinforces my personal observation that developers in BCS have drastically overestimated the value of golf courses as a means of drawing the champagne and caviar crowd to the Baja.

I believe I have also read that of the eleven golf courses in the Cabo area, only one is profitable.

Leaving aside the argument that it is insane to build golf courses that require 500,000 to 1,000,000 gallons of water a day in a desert that's already in short supply of potable water, it would seem to me that the declining popularity of golf as a participant sport makes investment in a development anchored around a golf course an extremely dubious proposition.

Does any developer of anything in Baja California perform due diligence in the form of market research before launching a project?

David K - 6-23-2009 at 09:15 AM

I will see if I can find out anything Cindi...

Only if they use their own money

Dave - 6-23-2009 at 12:36 PM

Quote:

Originally posted by bajajazz
Does any developer of anything in Baja California perform due diligence in the form of market research before launching a project?

Cypress - 6-23-2009 at 12:39 PM

Golf? It's like pool, but the table eats up a lot of real estate. :biggrin:

dtbushpilot - 6-23-2009 at 12:42 PM

Never could get fired up enough over "pasture pool" to take it seriously.....dt

Cypress - 6-23-2009 at 02:03 PM

Quote:

Originally posted by dtbushpilot
Never could get fired up enough over "pasture pool" to take it seriously.....dt

bajamigo - 6-23-2009 at 03:20 PM

Quote:

Originally posted by arrowhead
Real estate fraud in Mexico? Who knew?

Well, the good news is that the fallout from this and other highly public fiascos, like Trump Baja and Loreto Bay, will probably kill off what little chances Punta Brava ever had of being a real project.

Sure hope so.

David K - 6-23-2009 at 05:04 PM

It is sadly confirmed to be true... I was sent this video link from a good information source.

This news report spells it out as to what's going on... The El Rosario airport is mentioned (not by name): http://www.foxbusiness.com/search-results/m/23127657/nhl-pla...

Diamante del Mar in El Rosario had a concrete airport on the mesa (you can see it west of the checkpoint on Hwy. 1), a two story showroom/ guest facility, another couple of homes, roads, and they sponsored the Baja-Rosario Cultural Festival in financial assistance for the circus tent rental, etc.

lizard lips - 6-24-2009 at 06:47 AM

What a sham and a shame. The price to play at a course in Cabo is anywhere from $200 to $450. As much as I play the game I would never pay that and Cabo doesn't need another course anyway! I would pay that much to play Pebble Beach which has a lot of history as well as Augusta.

I have played El Dorado,Cabo del Sol, and Cabo Real but played for free and the courses were great.

I really don't think this will affect Punta Brava in any way. This could have taken place anywhere but because it was Mexico it just looks a little more scam worthy to the news media.

wilderone - 6-24-2009 at 08:28 AM

The MO for Punta Brava is no different - inexperienced developers, no loan money, huge-unreasonable building plans, need multimillionaire customers, no easy, fast access to the property, aside from the actual location of the golf course, there is nothing to draw a millionaire resident/tourist to the poverty ridden region, megabucks maintenance, megabucks infrastructure and amentities-the cost of which would be borne by the purchasers. Punta Brava is being sold as residences - second homes - not gonna happen in this political climate and in the middle of a drug war arena. Would you bring your family there? All the gullible Canadians have already bit into the LB apple, and the hockey players willing to give someone their golfcourse money have learned their lesson. If anyone buys into Punta Brava as an investment, he will deserve to eventually lose his money as will certainly happen because there is nothing to point to success of the project and plenty of indicators of how this scenario plays out.

tripledigitken - 6-24-2009 at 08:33 AM

Wilderone,

You certainly point out all the negatives which I agree with.

The proponents keeping saying Tiger will overcome the negatives and bring big buck investors to the plate. Time will tell but that is putting alot of the future success of Brava on the promise of rubbing shoulders with Tiger.

Ken

Martyman - 6-24-2009 at 08:50 AM

I love golf! I usually pay about $20 a round sometimes as high as $70 up here in CA. Who will build a desert course in BOLA like they have in Punta Chivato (no water)? I fear I will never play golf in baja...

wilderone - 6-24-2009 at 09:39 AM

ken - if and when Tiger finishes his Dubai project - which may or may not be successful because of the general downturn of the real estate component of that project - Tiger may not have the stomach for Punta Brava. Regardless, Tiger is not the developer of Punta Brava. The sales office is in downtown San Diego where they have to helicopter people over to the property. It will take millions of dollars just to advertise and market this property. Compare these sales techniques with that of LB and Dorado Ranch where they've been having monthly dinners, bus tours, 3-day weekends, for years to sell a property. And like those properties, it's been 5-10 years and still only a fraction is built-out. Yeah - time will tell.

wilderone - 6-24-2009 at 09:45 AM

Woods' Dubai course on hold. Punta Brava awaiting permits.

http://www.golf.com/golf/tours_news/article/0,28136,1903124,...

wilderone - 6-24-2009 at 09:48 AM

Woods says Dubai golf course on hold
Published: June 05, 2009

DUBLIN, Ohio (AP) — The first golf course Tiger Woods is designing might not be the first to open. Woods said on Friday that construction on Al Ruwaya Golf Course in Dubai is on hold because of the economic meltdown in the United Arab Emirates, pushing back the scheduled opening by at least six months.
"It's six months as of right now," Woods said in an interview at the Memorial. "It's going to be behind schedule. Obviously, the economy has turned over there and they've slowed down construction because of it."
The course was to open this fall, but Woods said it could be next summer. "It all depends," he said. "The economy needs to turn around. If it gets stimulated, we can pick up to the point where we might open earlier, but who knows? It's out of my hands."
The project is called the "Tiger Woods Dubai." It includes 100 villas, 75 mansions, 22 palaces and a 360,000-square-foot boutique hotel. It also is to feature at 139,000-square-foot clubhouse and a golf academy. The developer is Tatweer, a division of Dubai Holding, which is owned by the emirate and its rule, Sheik Mohammed bin Rashid Al Maktoum.
Woods said Beau Welling, his chief architect at Tiger Woods Design, has continued to travel between Dubai and two other courses under construction in North Carolina (The Cliffs at High Carolina) and Mexico (Punta Brava).
His course in Dubai had only three holes under construction when work was suspended. "We're making sure we get the holes completed - the holes we have," he said. "I think we have three holes right now." He said the course in Dubai needs irrigation to keep the sand in place because of arid conditions and the wind. Woods said on one of his visits, the sweeping wind "changed the whole outline of one hole."
Woods said his courses in North Carolina and Mexico are awaiting various permits, but otherwise are on schedule. The Cliffs at High Carolina is expected to be finished in the middle of 2010, while the Mexico course with spectacular ocean views is not scheduled to be completed until late 2010.

wilderone - 6-24-2009 at 10:14 AM

And social and legal pressures against Punta Brava can't be ignored:

http://www.elaw.org/node/3850

tripledigitken - 6-24-2009 at 10:24 AM

Quote:

Originally posted by wilderone
ken - if and when Tiger finishes his Dubai project - which may or may not be successful because of the general downturn of the real estate component of that project - Tiger may not have the stomach for Punta Brava. Regardless, Tiger is not the developer of Punta Brava. The sales office is in downtown San Diego where they have to helicopter people over to the property. It will take millions of dollars just to advertise and market this property. Compare these sales techniques with that of LB and Dorado Ranch where they've been having monthly dinners, bus tours, 3-day weekends, for years to sell a property. And like those properties, it's been 5-10 years and still only a fraction is built-out. Yeah - time will tell.

Wilderone,

You don't have to convince me that Punta Brava is a long shot. I'm on record that I don't think it will ever be completed. With a published completion of 2010 they are dreaming. The grading would be the first item in the schedule that will need considerable construction water ie the new delsalination plant. Has that started? I think not. I sincerely doubt that the little existing plant would generate enough water just to supply the grading needs, let alone the massive amount of irrigation to maintain the course.

I am also aware of Engineering Firms in San Diego being consulted on this very topic. The general feeling is that a concise plan or contractor for competing the grading is not in place.

Ken

Bajahowodd - 6-24-2009 at 11:44 AM

Didn't they recently privatize the only public course in Los Cabos? I recall it was the nine hole course in San Jose. think it was one of the mega developers such as Mayan. Maybe I'm wrong....