Local investors, Anchor Bank strike deal for Lake Lawn Resort
“They didn’t leave that on the table,” Drescher said, chuckling.
Drescher and a team of local investors late Friday struck a deal with Anchor Bank to buy Lake Lawn Resort for $9.5 million in cash. That price is meant to cover a $900,000 special city of Delavan assessment.
Drescher said he hopes to close on the deal in mid-April and open the resort at the end of April. The pieces of the property such as the golf course, the boat slips and the resort itself could open at different times.
Drescher said he expects to have access to the property before closing to start spring maintenance on the golf course. That work probably will start the first week in April.
Drescher, a Geneva National resident and a former president of that golf club, has not said whether he would be involved in managing the resort once it is reopened. This weekend, Drescher is expected to meet informally with a group of former Lake Lawn department managers to learn how things worked.
The meeting will not include former General Manager Pete Zellmer, Drescher said.
No one has been offered a job at this time, Drescher said.
“We’re going to start to put together a new game plan for how we see things coming together,” he said. “I want to get a good idea of how the structure functioned.”
The bank will be notifying the Wisconsin Department of Workforce Development about the sale, Delavan City Administrator Joe Salitros said. When a management team is in place, that team will start contacting former employees about getting their jobs back.
When Anchor Bank closed the resort in December, 300 people lost their jobs.
The new management team also will contact the clients who had booked events before the resort was closed, Drescher said.
Drescher said he has plans for up to $2 million in repairs and updates on the property, although not all will happen right away.
“I want to be sure we have not undermined any particular component,” Drescher said. “Now we can get to the other side of the sale, see the opportunities and do what’s the best thing for the overall property.”
Drescher in the last two weeks had offered $8.4 and $9.3 million in cash for the resort. The second offer also was meant to include the price of the special assessment.
A deal was slow in coming. Many had expected action last Friday, but it never came.
Anchor Bank had its hands full, Drescher said. Anchor was the lead negotiator of a team of 13 banks that held the debt on Lake Lawn.
The banks met at the resort Friday afternoon and voted unanimously to accept Drescher’s offer, Salitros said.
Anchor Bank in October bought Lake Lawn in a foreclosure sale for $19.97 million. The bank in August 2009 filed a foreclosure suit against the resort owners for a $51.9 million loan; the court awarded the bank $24.35 million.
Lake Lawn’s reopening will avoid what would have been a big hole in the city of Delavan’s operating budget. The city’s budget assumed Lake Lawn would operate for at least part of the year. It includes $254,545 in room tax dollars from a full year of operation from the three hotels other than Lake Lawn and nine months of operation from Lake Lawn.
Room taxes are far from the only reason Walworth County will celebrate the reopening of Lake Lawn, Salitros said.
“This means people go back to work, and people will have some reason to celebrate when Easter comes,” Salitros said. “Area retailers will have reason to be happy about this announcement.”
Delavan Mayor Mel Nieuwenhuis said he has spent much of the last two weeks on the phone with bank officials, state elected officials and high-ranking state staff members. He also spent much of this week trying to keep his hopes from getting too high.
Nieuwenhuis on Friday said he was especially happy that in addition to the hundreds of in-house jobs coming back to town, Drescher would hire local contractors for the planned repair work.
“There’s work to be done,” Nieuwenhuis said. “And that helps out local people not just in Delavan but in the Walworth County area. … It’s a beautiful thing.”