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Saturday, July 04, 2009

Failed golf-resort project bankrupted four Minneapolis companies

(This entry was originally posted in this blog on December 5, 2008 and the information is based on that time.)

A failed golf-resort project bankrupted four Minneapolis based companies including a developer, a family owned investment firm in Burnsville, the city of Desert Hot Springs, twenty four creditors and investors from the Twin Cities and PGA Tour pro Phil Mickelson’s golf-course design firm. On November 21, 2008, the four companies filed for Chapter 7 bankruptcy. It claimed debts of $165 million and assets of $7 million.

In January 2006, Michael Crosby, a Minneapolis-based developer, announced to build a 1,800-acre resort on the outskirts of Desert Hot Springs. The project named Palmwood, required 2,200 homes, 1.4 million square feet of retail space and two golf courses designed by Mickelson.

Such a failure is not unexpected as the ongoing economic slowdown affected the golf industry. Golf courses around the country are seeing the numbers of their members going down as economic crisis and job loss affected people’s income. Due to lower number of customers, China’s Mission Hill golf course, one of the largest golf-courses in the world, cut down 20% of its employees.

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