When it was first developed in the early 1990s, buyers rushed to snap up properties in Geneva National, a golf course subdivision near Lake Geneva. However, a few years later, property values plummeted, and the original developer, Lombard, Ill.-based Anvan Corp., lost the property to its lenders. "About 1,000 days ago, it was still considered a failed property," said Joel Reyenga, sales director for Lake Geneva-based Keefe Real Estate Inc.
In 2001, Keefe Real Estate and Scott Lowell acquired most of the undeveloped land in Geneva National and controlling rights for the development.
They revitalized the project, and today, sales and property values are on the rise again.
"We’ve obviously benefited from a strong secondary home market," said Rob Keefe, president of Keefe Real Estate. "I think we took the steps necessary to position Geneva National so it could take advantage of that market."
In the late 1980s, Anvan began acquiring property in Geneva Township just northwest of Lake Como. The company unveiled its plans for a 1,600-acre, master-planned, gated community with golf courses, commercial space and vacation homes. Geneva National built three 18 hole golf courses designed by golf legends Arnold Palmer, Gary Player and Lee Trevino.
Construction on the development began in the early 1990s. Anvan had to install sewer and water facilities in the unincorporated area. Buyers eagerly snapped up properties, some buying several lots on speculation.
"A tremendous amount of real estate was sold," Reyenga said. But it didn’t last.
"That whole spec boom really ran out of steam and led to a drop in property values," Keefe said.
By the mid-1990s, lots in Geneva National, about a half-acre each, were selling between $20,000 and $29,000, he said.
The Geneva National bubble had popped, and so did the development’s image.
"The property began to get this sort of negative reputation," Keefe said.
In the mid-1990s, Anvan lost the Geneva National development to its lenders. The company had used Geneva National as collateral for other developments in Chicago that had failed.
So the land in Geneva National that Anvan still owned was turned over to a group of lenders that called itself the Geneva National Real Estate Group.
"The property ended up being run on an absentee basis by this bank consortium," Keefe said. "They weren’t particularly involved."
Geneva National seemed stuck in the mud, owned by a group of banks that just wanted to sell to recoup as much of their losses as possible.
"It just drifted sideways," Reyenga said.
Lowell wanted to buy the Geneva National property, but needed to partner with a real estate developer to do so. He convinced Keefe Real Estate to partner with him in the venture. In 2001, they acquired 262 acres of undeveloped land and control of development for Geneva National. Keefe declined to disclose the sale purchase price.
"It was a great buy, very inexpensive," Keefe said. "We saw tremendous potential (in the property). Three championship golf courses, sloping lots, woods and demographics that would be greatly in our favor for 20 years as an increasing number of baby boomers would be coming into the second home market. We just thought it was grossly undervalued."
The golf courses were not part of the purchase. By then, Anvan had already sold the courses to Paloma Golf Group LLC. However, the quality of the golf courses was the key that gave Geneva National a chance to be revived, Reyenga said.
"These are three really great golf courses," he said.
Lowell and Keefe Real Estate had the right to build 576 residential units on the property they had acquired from the bank consortium.
The company sold about eight acres to homebuilder Jim Drescher, who built Golf View Terrace, a neighborhood with 30 duplex condo units and one single-family home on the 12th and 14th fairways of the Lee Trevino course. All have been sold for about $400,000 to $500,000.
After acquiring the property with Lowell, Keefe Real Estate began working on a plan to revive Geneva National. They brought two architects, two people who specialize in golf course communities, a legal expert in condominium law and an expert in marketing golf course communities to Lake Geneva to tour Geneva National.
"We got experts to come look at what we had and provide their recommendations of what we should do," Keefe said. "Our initial motivation was to get Geneva National back on its feet to increase the value of the asset we owned."
They rebuilt the entry-way to the subdivision, which Keefe said had an "imposing suburban look." There were large white walls on either side of the entry way and a security guard sitting up high.
Keefe wanted to make the entry-way look more inviting. They moved the guard house up close to the street and enhanced the entrance to the subdivision. The project was paid for by the residents of Geneva National through their property assessments, Reyenga said.
Keefe also built a few small office buildings near the gate, including one for its own sales office.
"All of that (construction) activity, I think, was an important component in letting people know that something was going on back there," Keefe said. "It sent a signal to people driving down the road that maybe this is worth another look."
A retail building eventually could be added to Geneva National, but the subdivision does not have enough full-time residents to support that right now, Keefe said.
Keefe also decided to change the sales approach for properties in Geneva National. Most master-planned communities first sell the amenities of the community and then focus on the individual properties. But Geneva National had not been sold that way for years, Keefe said.
In addition, Keefe Real Estate helped the builders who had constructed houses in Geneva National form a consortium to collectively market themselves as Geneva National builders. They created a Web page www.gnbuilders.com and purchased advertising for Geneva National in Chicago, including on WGN radio.
Some of those homebuilders acquired smaller pieces of Geneva National property from banks and have had success selling new units:
- Greg Choyce acquired 80 acres in Geneva National owned by Rosemont, Ill.-based Cole Taylor Bank. In 2004, he built The Turn, a neighborhood of 14 duplex condo units on the 8th hole of the Arnold Palmer course. All of them have been sold for about $400,000 to $500,000.
- Kenosha homebuilder Jim Walter acquired approximately five acres in Geneva National from Bank One and built 16 condo duplexes on the 16th fairway of the Lee Trevino course. The condos in the neighborhood, called Eagleton Ponds, were priced between $269,000 and $360,000, and all but three have been sold. Walter plans to build eight more condos in a second phase of Eagleton Ponds on the 15th green of the Trevino course.
- McHenry, Ill.-based Lanco Development Co. purchased 10 acres of land near Eagleton Ponds from Walter and plans to build 42 luxury duplex condominiums priced at about $450,000 each.
- Foxwood Builders acquired 65 acres from Chicago-based LaSalle Bank. This year, Foxwood will start building 106 duplex and single family condominium homes, priced between $499,000 and $699,000, on the 13th and 14th holes on the Trevino course.
Since all of the changes were made at Geneva National, property values and sales have soared, Keefe said. In 1997, property sales in Geneva National totaled $2.5 million. In 2001 property sales in Geneva National had grown to $8 million, and they rose to $48 million last year, Keefe said.
"It’s certainly been a great investment for us," he said. "It’s just going to get better."
Keefe Real Estate recently purchased Lowell’s share of Geneva National.
There are no new single-family lots available from Keefe, but some are available from people who bought them and never built. Keefe has sold about 35 acres to other developers and plans to develop the remaining 226 acres with up to 488 attached condominiums.
Keefe is just starting its first Geneva National development, to be called Cobblestone Courtyards, an 86-unit attached condominium project. The units will cost in the $299,000 to $349,000 range.
Geneva National could have 1,960 residential units at full build-out. So far, about 800 have been built.
"I would say in six, seven or eight years, we will be totally built out," Reyenga said.
