Northern Michigan’s Sugar Loaf Mountain Back in the News

Perhaps the most stable force in the Sugar Loaf story in the past 10 years is Ed Fleis, who along with other investors purchased the resort’s two golf courses, the wastewater treatment plant and 120 acres of view property on the west side of the hill from John Sills in 2005. “Originally our intent was to get it all,” Fleis says. (The Arnold Palmer course was recently sold to The Homestead resort, which renamed it Manitou Passage.)

Fleis grew up two ridges to the east of Sugar Loaf on a farm along Schomberg Road. After high school, he headed to Michigan Technological University, earning a civil engineering degree in 1963 and spent most of his career in the Carolinas and Florida managing large development projects. He understands infrastructure, he understands golf course development, he understands resort financing, he understands the need for somebody with access to real capital to take on what he estimates to be a roughly $30 million investment to make Sugar Loaf viable. But he also understands the potential that Sugar Loaf still has and that the wonky tale of the resort’s past decade doesn’t diminish what its future can be.

On a misty October morning, Fleis stands 40 stories high above Lake Michigan on the brink of Awful Awful, the radically steep ski run that helped make Sugar Loaf a darling of Michigan’s hotshot skiers in the 70’s. Around him, the land falls away dramatically, and that stunning view plays out: the water, the islands, the farmland, and the forests, today colored in shades of gold and bronze.

Fleis listens carefully, speaks thoughtfully. And today, you can see his mind working that tricky balance that successful developers must strike: romantic vision and grounded pragmatism.

Something else is also shaping what Fleis can and cannot say. Rumors are circulating that some kind of Sugar Loaf deal is in the wind involving an investment group headed by David Skjaerlund, from Owosso. Skjaerlund spent the past several months getting options on several Sugar Loaf town houses and nearby properties, according to Tony Mattar, who co-manages the town house association.

Working quietly and insisting on nondisclosure agreements, Skjaerlund has succeeded in avoiding the media attention that surrounded Liko Smith. [Skjaerlund did not return calls for this story.] An Internet search shows Skjaerlund is an entrepreneur with a Ph.D. in Animal Science and a focus on rural development. His most recent high-profile project was a $100 million ethanol plant near Ithaca, Michigan, that ceased construction after a $60 million investment when the ethanol market collapsed.

Fleis, also bound by confidentiality agreement, cannot comment on particulars of any sort of Sugar Loaf deal, but he agrees to talk broadly about what a developer must consider in looking at the resort’s potential. “With the kind of investment it takes, you can’t get the return strictly by having a ski resort—a ski operation and a nice resort building,” he says. “It has to go into commercial development. Some sort of village center with fairly extensive residential development.”

By commercial development, Fleis means more than the traditional set of retail boutiques you see at ski resorts. He means office space and all the workers who would fill that space every day—a business park.

Fleis scans the Sugar Loaf grounds from on high and points to the airstrip and a golf fairway that runs alongside it. “If you removed the airstrip—which many people might object to—and move that fairway, you could open up a lot of land for a village center,” he says. Turning to the west, he traces his finger along the ridgeline. “And on the west side of this hill there are some very valuable view properties.”

As for the existing lodge, he agrees with virtually everybody who has looked seriously at the property: the lodge will almost certainly be demolished. Then the practical side of Fleis’s developer mind pushes a note of caution into his voice. “But you need the residential, and the housing market is still so down. You end up with a lot of holding costs when things don’t move forward.”

County commissioner David “Chauncey” Shifl ett has been one of the most ardent proponents of getting Sugar Loaf back in operation, a passion helped in part by the fact that he lives nearly at the foot of the mountain and sees it sitting vacant every day. He has worked with county planner Trudy Galla to establish a brownfield development authority in large part to address any contamination issues at Sugar Loaf—subsequent studies of the buildings and underground storage tanks have found very little contamination. He and Galla have also laid the groundwork for a tax increment finance zone that could help the developer pay for demolition and cleanup costs.

Like Fleis, Shifl ett also sees no way for Sugar Loaf to exist in the traditional mode of a ski resort. There’s just not enough revenue to support the expensive ski infrastructure, he says. People have discussed the possibility of having the county purchase just the hill and run it as a community ski hill. “But I don’t see the leadership on the park board to do that now,” he says.

Shiflett has been beating the drum for a business center there for years now—high tech info-based businesses that just need a fat data pipeline to do their work. “We have an aging population. We have to figure how to attract young working families that doesn’t revolve around recreation. We need employment opportunities, like intellectual arts, multimedia content creation, maybe a film production studio. People working day in and day out, not just on the weekends,” he says.

Given the shenanigans surrounding Sugar Loaf’s decade of closure, it’s surprising how optimistic the people are who have worked closely with the resort. “Do I think people will be skiing there within the next five years? Yes,” says county planner Galla. “I get calls every six to eight weeks from people interested in Sugar Loaf.”

She intends to take a presentation to an annual national brownfi eld conference this year and show off the resort to thousands of developers from across the country who specialize in brownfield development. “I feel very positive that something will happen. I can’t imagine it will continue to sit there vacant with the carrying costs on that site.”

Meanwhile, Sugar Loaf Mountain waitsto impress the next would-be developer. That knockout view from the top, the adrenalin thrill of Awful Awful’s steep, Leelanau’s shore so close. And the developer will think what so many before have also thought. How could it not work?

Jeff Smith is editor of Traverse. [email protected]

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