GULFPORT, Miss. (WLOX) - The Great Southern Golf Club, Inc. filed for reorganization under Chapter 11 of the bankruptcy laws Wednesday. This measure was taken to provide an opportunity for Mississippi’s oldest golf course to restructure its debt that has accumulated since Hurricane Katrina destroyed the course in 2005.
“Although the golf club has been cash flow positive so far this year, we have not been in a position to pay the debt service nor pay a Promissory Note due that was secured by a Deed of Trust for the 129 acres,” said Ellis Hill, President of Great Southern’s Golf Club Inc.’s Board. He also said that the club had been working with several lenders for a bridge loan over the past few months.
“We were very close to completing a loan with a lender last week, but the lender changed the terms of the loan at the very end, which could have resulted in the out of town lender owning the property”, Hill said.
The Great Southern Board has been working on a plan to sell parts of their property that are not used for the golf course to build condos and single-family homes taking the profit from those sales to retire all the long-term debt first, then provide funds to improve the course, and to pay dividends to stockholders, if possible.
The long-term debt is just over $4 million, and an estimated $1 million would be needed to improve the course. Part of the Home Owner’s Association dues would be used to maintain the common ground and golf course. This action will provide an improved financial situation that will allow the golf club to continue operations.
WLOX reported in June the property would be put up for foreclosure, and the golf course was originally scheduled for a public auction on July 8. Hill told WLOX News Now the foreclosure will no longer take place following the bankruptcy filing.
As part of cost cutting measures, the club will close its restaurant which has not been profitable and continue to sell beverages and snacks from the Pro Shop as it searches for a possible tenant to lease the restaurant with full kitchen equipment and furniture.
The Great Southern Golf Club is Mississippi’s oldest golf course. It was set for foreclosure proceedings on July 8. I’m checking to see what Chapter 11 bankruptcy reorganization means for the foreclosure auction.
It’s interesting to read the board needs condos and single family homes on parts of its 129 acre property to save the golf course. Home Owner’s Association fees attached to those homes would “allow the golf club to continue operations.”
update no foreclosure
Filed for bankruptcy today
Trying to reorganize its debt
Will close the golf course restaurant
Will keep the golf course open
Searching for a developer to build homes and condos and generate funds to allow the golf club to continue operations