Clients and Cooperating Brokers Suffer Through Ginn’s BriarRose Transitions
A story of misplaced trust.
Palm Coast, Florida – September 18, 2008 – Developers like Bobby Ginn typically have programs to encourage outside real estate brokers to bring clients to their communities. A husband and wife real estate team based near Chicago participated in such a program at The BriarRose, a 1,879-acre luxury country lifestyle community in Georgia’s Oconee Valley marketed as "Rural America at its finest." The couple and their clients would not give high marks for the way they were treated. Here is their story.
Marian Schaffer and husband Terry Molnar were introduced to The BriarRose by its developer, Jeff Davis and his son Brian. Jeff had a long term relationship working for Bobby Ginn that began in Bobby’s Hilton Head era. He went off on his own to develop The BriarRose with financial help from investors, including some of his friends. Marian and Terry were impressed from the beginning by the potential of the property and charm of the Davis family. Several of their clients, drawn by the understated elegance at the BriarRose and the slower pace of life atmosphere, purchased retirement property there. They also befriended the Davis family.
By mid-summer ’07, the lack of progress led Marian to question the long term viability of the project. The 18-hole golf course was only half completed after 16 months of construction. There were no signs of the Club Village which was to include a club house, pro shop, locker rooms, a fine dining hall, a cigar lounge and a wellness center. The BriarRose Equestrian Center and Club consisted of only a few existing barns. There was no construction activity for the two outdoor pools, a kids pool or water slide. There was no sign of progress at the proposed site for the "World-class BriarRose Sporting Club" to have been located on a 500-acre site about 3 miles away. BriarRose literature boasted that Davis had retained internationally acclaimed designer John Higgins of the British Shooting School to design and oversee construction of the game clays course and serve as an integral part of the staff at the BriarRose.
Along the way, two more clients Marian and Terry had registered at BriarRose mysteriously became Davis’ clients. When they purchased, no co-brokerage commission was paid. A total of 258 lots were sold at an average price of $250 thousand, totaling $64.5 million. The proceeds apparently covered half a golf course, some underground utilities, some slick marketing material, and lots of sweet tea. Are you beginning to get the picture? I’m sure Jeff’s investor friends are wondering where all the money went. Becoming very leery, Marian and Terry advised one of their clients to halt a planned BriarRose purchase. (This client recently purchased property in Western North Carolina, again working with Marian and Terry.)
About that time, Davis announced that the BriarRose had been acquired by Ginn Resorts (story). An August 15, 2007, Ginn Resorts issued a press release stating "We are fortunate to have the opportunity to again work with Jeff Davis and his team with the acquisition of this picturesque property," said Bobby Ginn. "It has always been our plan to expand to Georgia but only with the ideal location and community concept." As part of the deal, Jeff Davis was to rejoin Ginn Development to head their sales effort, a position he held previously (1999-2003).
Things seemed to improve with Ginn in the picture backed by their financial partner, Lubert-Adler. A "mini-launch," which I attended (story), was held with the release of 23 cottage lots. All 23 lots plus 3 estate lots were reportedly sold. I learned later that none of the sales closed as buyers canceled their contracts.
Jeff Davis’s tenure at Ginn lasted only a few months. He was dismissed from the company and ordered to stay off BriarRose property. It was revealed that Davis never owned the land on which the Sporting Club was to be developed. He only had an option to purchase. The option expired. The option on land that would have provided the promised access to Lake Oconee was also allowed to expire. BriarRose was at a standstill. Davis has not communicated with Marian and Terry for over three months.
The story continues. Lubert-Adler, a prominent Philadelphia-based real estate investment firm, reportedly owns 50% of Ginn Development as well as 80% of each project. It seems that Ginn, while maintaining his 20% equity in BriarRose, has been removed from any operational activities there. Lubert-Adler has engaged another developer, Atlanta-based PM Communities, headed by Patrick Malloy. Lubert-Adler approached Patrick to be an "operating partner" because of successful working relationships with him in the past.
Marian and Terry and their BriarRose clients joined in a recent conference call with Patrick. Feeling betrayed thus far, they were all apprehensive. When he got off the call, Terry said he felt hopeful that in five years, his clients, now friends, would call from the BriarRose boasting that in the end, everything actually worked out for the better. Interestingly, when the subject of the Ginn One Club came up, the clients were unanimous in their desire to have no relationship with Ginn or One Club. While The BriarRose still appears on a few of the Ginn Websites, the Ginn name was never on the BriarRose site. The BriarRose site is currently "under construction."
So Jeff Davis betrayed Marian and Terry’s trust and the trust of their clients. He also turned his back on many of his friends who entrusted their investments to him. And he even betrayed Bobby Ginn who came to his aid in an attempt to rescue the project and was left holding the bag. Marian says Jeff is hiding somewhere under a rock. She hopes he stays there.
For further information about Marian and Terry, visit their blog site SouthernWayofLife.com where you can also find more about Patrick Malloy’s plans for BriarRose. Some think that a name change would be a good start.
Briar Rose
IMMEDIATELY CHANGE THE NAME, Briar Rose does not connote a sophisticated property. Mom’s moonshine is a thing long past.