‘Buy a lot, get 500 acres free’: What’s up at Bedico Creek?
By Kim Chatelain, NOLA.com | The Times-Picayune
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on June 02, 2016 at 2:44 PM, updated June 02, 2016 at 2:56 PM
There exists a theory in real estate development that the second mouse often gets the cheese. Meaning, the first developer on large projects is prone to stumble, setting the stage for the second one to reap benefits.
Ergo, meet David Waltemath, the second mouse at Bedico Creek, an almost 1,000-acre subdivision that was left for dead in west St. Tammany Parish a decade ago. Waltemath, a third generation developer whose resumé includes English Turn in Algiers, Santa Maria and Green Trails in Baton Rouge and The Estates of Northpark near Covington, made an outside-the-box decision to convert Bedico Creek into what he calls a “conservation community,” and it appears to be paying dividends.
Gone are plans to form yet another golf course community along the lines of Beau Chene, Tchefuncta Club Estates, Money Hill and Covington Country Club. Instead, the land that was previously earmarked for greens and fairways is part of about 550 acres now allocated for parks, green space and a nature preserve, with miles of walking trails accessible only to Bedico Creek residents.
Rather than trying to cram more houses and man-made amenities on the property, Waltemath has filled the sand traps, pulled the pins on the putting surfaces and returned to nature what was once nine holes of fledgling golf course. He said dedicating more than half the property to parks and green space is feasible because he bought the defunct, partially developed Bedico Creek golf community at the bargain price of about $5 million from a group of bankers in 2010.
His redevelopment concept seems to be working. Waltemath says he sold 86 properties in the subdivision in 2015, making it one of the hottest selling spots on the North Shore, if not the New Orleans region. He thinks buyers are attracted to the peacefulness of country-style living within 14 miles of the Lake Pontchartrain Causeway, 3 1/4 miles of Interstate 12 and less than 6 miles from shopping areas of Covington.
A unique sales pitch is used to market Bedico Creek’s residential properties amid the vast greenery that is accessible only to the home owners in the gated subdivision: “Buy a lot, get 500 acres free.”
Land of litigation
Nestled on the western edge of St. Tammany Parish northwest of Madisonville, Bedico Creek was one of the region’s most ballyhooed residential development proposals. In 1996, Covington businessman John Poole proposed more than 1,600 homes and a 27-hole golf course on 988 acres.
Opponents organized under the Save St. Tammany banner came out hard against the development, asserting that a subdivision of that many homes was too dense for the mostly rural area. The group sued in 1997, taking the case all the way to the Louisiana Supreme Court, contending the parish government violated local zoning codes when it rezoned the property.
The courts ruled against Save St. Tammany. But the stiff opposition prompted a revision of the development plan, to 942 homes around an 18-hole golf course, and Save St. Tammany endorsed the scale-down proposal.
Even with a reduced density, Bedico Creek was to be one of the largest residential developments in St. Tammany. The largest is Beau Chene near Mandeville, which sprawls over 1,200 acres with two 18-hole golf courses and 1,500 homes.
But Poole never actually broke ground on the property. Stymied by litigation and market conditions, the Bedico Creek project languished until George McClure, an award-winning Atlanta developer, stepped in and bought it from Poole for $7.35 million in March of 2005. That summer, McClure began work on what was to be a 10-phase, 942-lot, gated golf-course subdivision.
Hurricane Katrina cancelled McClure’s kickoff party, scheduled for early September 2005, but McClure resumed work in 2006. St. Tammany Parish gave his company, Upland Properties, permission to sell 109 homesites in Bedico Creek. Streets were cut, houses began to rise and work on the first nine holes of the golf course neared completion
Soon, however, work came to a screeching halt. On Aug. 10, Marshall Investments sued Upland Properties in federal court, contending the company had defaulted on loans of $16 million and $1.7 million, records show. That lawsuit triggered others from Boh Brothers Construction Co., the main contractor that was hired to build Bedico Creek, and from the subdivision’s early settlers, who were dismayed that the company failed to complete the golf course and other amenities as promised in their purchase agreements.
Before long, what was expected to be a jewel of the North Shore had become a symbol of the national housing crash. Many of Bedico Creek’s houses sat empty, choked by tall weeds around a weathered golf course that was never finished.
While other areas in St. Tammany were buzzing with building activity to accommodate Katrina refugees seeking higher ground, Bedico Creek was dormant. Parish Councilman Marty Dean, whose district includes Bedico Creek, said he remembers driving through the subdivision one day and being amazed at its condition.
“It just looked awful,” Dean said. “There couldn’t have been much more than about 10 (inhabited) houses, and grass everywhere was knee high.”
Getting the cheese
In 2010, Waltemath assumed ownership of the property, saying at the time that he saw an “incredible opportunity at an incredible price.” The price was $5 million for the 988 acres of high and dry property in booming St. Tammany.
Waltemath said he knew right away that changes were in order. The North Shore already had its share of golf courses, many of them struggling to make ends meet.
“Golf was never going to work,” Waltemath said in a recent interview. “So the question became what do we want to do with it?”
After taking a hard look at the property, Waltemath and his associates, namely his children Scott and Kelly, came upon the idea of a “conservation community” that would use the property’s natural assets as an advantage, rather than felling trees for more houses and golfing. “We wanted it to feel like St. Tammany used to be,” he said.
Doing away with the golf course didn’t sit well with some who had moved into the community under the pretense of living on the links. Dean, the Parish Council member, said he recalls several heated meetings to discuss abandoning the course. But things have calmed down considerably at Bedico Creek, he said.
“I’ve not heard the first word or complaint in more than two years,” Dean said. “My impression is that he convinced people that a golf course would lose money.”
Real estate analyst Wade Ragas said many golf course communities are struggling and might eventually have to be repurposed. “We have today a surplus of golf courses in the New Orleans metro area,” he said. “We have a surplus of holes and a slow growth in the number of golfers.”
What emerged from Waltemath’s reforming of the community is a development of 12 small neighborhoods within Bedico Creek, each with its own identity and price range. In sum, the community consists of 930 homesites of various lot sizes with home prices ranging from $250,000 to more than $1 million.
When Waltemath bought the property, he estimates that less than 20 homes were occupied. There are now about 200 homes occupied or under construction and about 300 more lots in various phases of development.
Bedico Creek consists of 173 acres of park space and a conservation area that measures 377 acres. The subdivision’s promotional material says “It’s like having a 500 acre backyard.”
Asked how so much property can be left undeveloped in a financially feasible development, Waltemath says, “The last guy (developer) paid for it.”
Western St. Tammany real estate broker David Holloway said he thinks Waltemath’s unique concept with different pricing points, along with low interest rates and a booming St. Tammany economy, have spelled success for the new version of Bedico Creek. “What they are doing there is working. … It fits the market,” Holloway said.
“It was very smart of him to segregate the neighborhood by price points. He hit the nail on the head with his recipe.”
According to numbers provided by Holloway from the Multiple Listing Service, homes sold in Bedico Creek over the past year ranged in price from $242,900 to $526,000. The price per square foot was from $124 to $161, the average time on the market was 96 days.
Sales in the subdivision have been on a steep climb, rising from 29 in 2014 to 86 last year. Bedico Creek reported only 9 sales in 2013.
Waltemath he hopes that when fully developed the 12 neighborhoods within its boundaries will make Bedico Creek a “multi-generational” community that will have first-time home buyers, top dollar properties and everything in between. He thinks Bedico Creek’s metamorphosis is progressing nicely.
“We’re just hitting our stride,” he said.
