Sugar Loaf, Michigan on Auction Block

News
Avatar:
Author:
Publish date:
Social count:
0
News
loaf022500B.jpg

Cedar, MI, Feb. 25-- One of Michigan's premier ski resorts may have to shut its doors unless a buyer can be found to rescue the cash-strapped operation.

Sugar Loaf Resort, located 18 miles northwest of Traverse City, will be up for sale in a sealed-bid auction on March 23, handled by Sheldon Good and Company of Chicago. The resort includes an alpine ski area with 25 runs and 6 chair lifts, a 150-room hotel, 130 condominiums, 12 meeting rooms and convention facilities, swimming pools, tennis courts, and cross country ski trails. In addition, the resort overlooks the Sleeping Bear Dunes National Lakeshore park and is close to Native American-operated casinos.

Although a favorite of Michigan and Midwest skiers, Sugar Loaf has had a checkered past. Founded in 1962, at least five ownerships have managed the resort. Most recently, owner Remo Polselli and his investors bought the troubled property in the fall of 1997. After spending $2.6 million in improvements, Poselli's group was hindered by two consecutive low-snow winters which severely hindered skier visits.

In addition to reduced winter revenues, the resort has had problems generating summer business. Two golf courses adjacent to the property, an 18 hole course and a 27 hole Arnold Palmer designed course, are not owned by the Polselli group, but by a previous owner of Sugar Loaf.

Most recently, Sugar Loaf was dealt another blow, as the resort was denied a liquor license transfer by the state of Michigan. The state reportedly denied the transfer in January, which will cost the resort an estimated $750,000 in lost business this month (February) and another $500,000 loss in March. Due to this, Sugar Loaf could close for the season as early as March 5.

Last summer the property was advertised for sale for $8.5 million in the Wall Street Journal. That ad was termed a mistake by the current owners, who were attempting to see if there might be a market for the resort, but had not given approval to the realty agent to put the property up for sale.

Midwest skiers will be watching intently to see what happens with "The Loaf." The resort's ski mountain is one of Michigan's best. The Awful-Awful run has been rated as one of the steepest runs in the region, and the Manitou run is one of the few F.I.S. sanctioned race hills in the Midwest. From the top of The Loaf, the sunsets over Lake Michigan are spectacular.

The loss of Sugar Loaf would mean that northwest Michigan's major destination ski resorts would dwindle to a half-dozen, further limiting skiers' choices. For Traverse City, it would mean that the nearest full-service resort would be Shanty Creek, approximately 40 miles to the east. The city does have a small ski area within its limits, Mt. Holiday, but the future of that area is tenuous since the death of its owner this fall. Having a healthy Sugar Loaf is key to Traverse City's winter economy.

The sealed-bid auction, with no minimum required, on March 23 may determine if Sugar Loaf will survive or close.