Skywater Over Horseshoe Bay is a planned luxury development of over 1,600 acres that was to include a Jack Nicklaus-designed golf course. In a move to prevent the property to be posted for auction next Tuesday in Llano County, the Chapter 11 bankruptcy filing is intended to allow the development to undergo reorganization to eventually be completed as originally planned, according to a story in today’s Austin American-Statesman.
But this isn’t the first time the property has been involved in a bankruptcy situation. Back in 2009, the original owner, HB Texas Funding, inc., also filed for bankruptcy. The original plans presented 1,200 residences and some commercial space, all to be completed by 2015. But, lot sales sank with the economy in 2008, leaving just 96 lots currently sold and only 4 homes built. There were only 164 lots for sale in Phase I of the project.
After HB Texas Funding, inc. filed for bankruptcy in February 2009, SW Ownership LLC came in just months later and purchased the property. SW Ownership LLC sunk in an additional $10 million to start the project up again. At this point, the official comments coming from the ownership group indicate that they still intend to complete the golf course and the residential project. The bulk of the debt disclosed is from the water rights, construction, and maintenance of the golf course.
To read today’s Statesman article, click here.
As of today, the website for the development, http://www.skywatertexas.com/ is no longer displaying any information, showing only a generic 404 page – an error message explaining that the site cannot be found.
An article published by the Statesman just over a year ago on January 29, 2010 touts the positives of the planned development with no indication that financial concerns were lurking. As of that time, the article says that over 90 lots had been sold, meaning just 6 lots have sold since January 2010. The article lists a number of amenities, with special attention being given to the new golf course – the same course whose costs now seem to have overburdened the planners.
To read the January 29, 2010 article from the Statesman, click here.
Going back further, a story published by Reuters on September 1, 2009 paints a rosy picture for the future of Skywater Over Horseshoe Bay. According to the article, “SW Ownership is committed to the long-term success of Skywater,” Bill
Cargill, a representative of SW Ownership, said. “Our first order of business
is to complete the Jack Nicklaus Signature Golf Course, which promises to be
the premier golf course in Horseshoe Bay. With the golf course under way, we
expect the lots in Skywater to be in high demand.” Unfortunately, the economy appears to have stalled interest in the lots leading to the bankruptcy filing. Another portion of the same article quotes IBC Bank, “IBC Bank is proud to be part of this project,” Richard Capps, executive vice president of IBC Bank – San Antonio, said. “We are working in close
partnership with the new ownership and management, and we would not have
undertaken the financing of the development if we were not supremely confident
that they have developed a sound foundation for success. IBC prides itself in
being a part of the continual development of Horseshoe Bay and Marble Falls.”
IBC made no official comments on the most recent bankruptcy filing.
To read the Reuters article, click here.
Skywater Over Horseshoe Bay still has an active Facebook page, but their last post was dated November 30, 2010. To see their Facebook page, please click here.
Mission Mortgage’s Mark Sprague, Director of Business Development, keeps a close eye on developers and builders in Austin and the surrounding area. His response to the bankruptcy filing was to say, “Skywater is a beautiful golf course and location and when the second home market turns in Texas it should hit its stride.” He has often commented in his public presentations that the Highland Lakes area experienced a more dramatic decrease in home starts and homebuying when the economy began to suffer than in-town locations in Austin. As the economy improves, especially with respect to jobs, the entire housing industry should begin to recover more fully.