Potential buyer says condotel owners saved Lake Lawn Resort
The condotel owners have paid for heat and security at the resort since it was closed in December, said Jim Drescher, a Walworth County developer negotiating to buy the resort.
If Drescher reopens the resort, the rooms will be ready to operate as hotel rooms, he said.
“Without them (the condotel owners) hiring security, I couldn’t be a buyer today,” Drescher said. “The condos, which would be my only source of income, would have been destroyed.”
Fifty-three of the 203 condotels at Lake Lawn are in foreclosure, but that won’t change a thing for people looking to rent rooms if the resort reopens, said Dale Thorpe, attorney for the condotel owners association.
Owners of the rooms have signed agreements allowing owners of the resort to rent and manage the rooms as hotel rooms, Thorpe said.
“From a guest walking down the hall, it doesn’t look any different,” Thorpe said.
As of Friday afternoon, reopening Lake Lawn still was an “if.”
Drescher had not signed a contract to buy Lake Lawn from Anchor Bank and a group of smaller banks that own the debt on the property, Drescher said.
The former owners of Lake Lawn Resort sold 203 of the 222 potential condotel units. The 19 unsold units were part of the Lake Lawn foreclosure that Anchor Bank initiated in August 2009, Thorpe said.
Condotels are hotel rooms sold as condominiums. Rent paid by guests is split between the resort and the room owners.
The condotels were not affected in a legal sense by the resort foreclosure but were affected when Anchor Bank in December closed the resort. Since then, condotel owners have not collected revenue from their investments, Thorpe said.
The resort includes 59 rooms that are not condo units.
Drescher is the lead negotiator among a group of local investors looking to buy Lake Lawn for $8.6 million in cash. Drescher agreed to be responsible for a $900,000 city of Delavan special assessment, which the city has agreed to phase out.
The bank has orally agreed to the deal, but the two parties have yet to sign on the dotted line, Drescher said Friday afternoon.
Drescher still is thinking in hypotheticals because he and the other potential new owners are still “potential.” But he plans to get to work right away to get the golf course ready for the season and plans to make $2 million in repairs to the resort in the next couple years.
He does not plan to do the renovations planned by the previous owners such as construction of a water park and waterfront condos.
He could do some other sorts of development such as build single-family homes. Drescher has said he is interested in putting some parts of the property into trusts to generate money for Walworth County charities.
If he becomes the owner, he would focus first on hiring the people who lost their jobs in December, Drescher said. More than 300 lost their jobs.
The hiring would take place in stages because the resort would have to start from scratch to bring in business.
“As we start to grow the business up, we’ll hire more people back,” Drescher said. “We’re starting out with no business. We don’t have one room booked, one banquet or one wedding.”
Last updated: 5:01 pm Thursday, December 13, 2012