Sugar Loaf owner to meet Leelanau public

The remains of a Lift 1 control shack. Photo by J. Carl Ganter.

Long-shuttered resort now in on-deck circle for Katofsky’s projects

By Jacob Wheeler
Sun editor

This continues our series on iconic but derelict or underutilized settings in our region.

Jeff Katofsky, who purchased Sugar Loaf resort last November, will return to Leelanau County on Friday, Oct. 20, and meet with the public at 11 a.m. at the Leelanau County Government Center where he will field questions about the path forward for the long-shuttered ski resort.

County administrator Chet Janik and commissioner Patricia Soutas-Little confirmed the visit from the southern California attorney, hotelier and minor league baseball team owner. Katofsky had asked Janik and Soutas-Little to plan his schedule while in Leelanau County. That will include meeting citizens who are passionate and concerned about the mothballed resort, which closed in 2000 and has since seen a revolving door of unsavory characters posing as suitors.

Sugar Loaf was once Leelanau County’s largest employer, and considered the prominent ski resort in this region of the state. For years, any rumors of progress have dominated dining room conversations, from the tip of the County to downstate.

Progress these days could be measured in Katofsky’s two southern Michigan properties, which he acquired together with Sugar Loaf (the “player to be named later” in baseball parlance) from previous owner Remo Polselli in a settlement in April 2016. His hotel in Romulus, near Detroit Metro Airport, opened in January. The St. Clair Inn project finally broke ground last month after a host of delays. “We’re already ahead of schedule,” said Katofsky. “They did five weeks-worth of work in two weeks. The weather’s been good.”

Since acquiring Sugar Loaf, Katofsky has consistently said that the Leelanau County resort is third on his priority list. With hammers swinging in St. Clair, Sugar Loaf is now “in the on-deck circle.”

Katofsky visited Sugar Loaf twice before, in August and last December. Since his first visit, last Dec. 14, Katofsky has complied with Haugen’s order to secure the property. In April he had the lodge boarded up, with 3,000 feet of fencing and “no trespassing” signs placed around the perimeter. Janik and Haugen were satisfied with that progress.

Janik was also pleased with progress he saw at St. Clair Inn. The county administrator toured Katofsky’s other two Michigan properties while on a trip downstate last month. He showed photos of those properties at the Leelanau County Board of Commissioners meeting on Oct. 3.

“It helps me with (Katofsky’s) credibility question,” said Janik. “The hotel in Romulus is complete and open. It’s a beautiful piece of property in St. Clair. Many people were working when I was there. I was very impressed.”

Janik and Soutas-Little have been Katofsky’s liaisons in Leelanau County. Following his December 2016 visit and meeting with numerous officials, they suggested that he return and meet with the public.

“The fact that Jeff (is choosing) to come up here and meet with us is a positive sign,” said Janik. “People have been burned in the past with respect to Sugar Loaf. He hasn’t made false promises to us. He also hasn’t made any grandiose statements that it would be open in six months. What I’m telling people is that I’m cautiously optimistic.”

Polselli’s name still on mortgage

Previous owner Remo Polselli is still associated with Sugar Loaf’s mortgage, prompting some to question whether he is actually out of the game.

Here’s the backstory: Katofsky’s corporation, Sweet Bread, L.L.C., got a $6 million mortgage last fall from a shell corporation called “Farmer’s Merchant Capital, L.L.C.”, which was registered in Kalispell, Montana, on Oct. 25—three weeks before Sugar Loaf was officially sold. A principle information request through the Montana Secretary of State office revealed that Farmer’s Merchant Capital, located at 1001 S. Main Street, Ste 500, in Kalispell is managed by Anna Sigurdson.

A Google search of Sigurdson shows her to be an associate of Polselli, under whose ownership Sugar Loaf has languished since 2000. Sigurdson and Polselli both faced criminal charges in July 2016 due to code violations at the resort’s decrepit lodge; Sigurdson answers the phones for Polselli at New California Hotels Corporation (onetime Sugar Loaf suitor Liko Smith also worked out of that office); Sigurdson also registered Polselli’s company Resort America L.L.C. in Florida.

But Katofsky is the undisputed owner of Sugar Loaf, and he doesn’t care who holds the mortgage. Katofsky thinks that Polselli may have sold or transferred the mortgage paper to a third party.

“When we bought the property, there was a seller-carry aspect,” said Katofsky. “I know the note was transferred. I know his business model is he sells the paper to a third party.”

“My guess is he’s using a conduit or he sold it. It doesn’t matter to me. They have no control over it, unless I default—which would be the first time that’s happened.”

Polselli also initially held the mortgage for the hotels in both Romulus and St. Clair, but may soon be no longer involved. County administrator Janik said he’s comfortable with Katofsky’s explanation.

“You can’t finance vacant, shuttered deals,” explained Katofsky. “We took him out (of the financial picture) within 90 days in Romulus, and we’re about to do so in St. Clair.” Katofsky implied that the same would happen with Sugar Loaf.

But for the time being, Katofsky said he will focus his Michigan attention solely on St. Clair.

“I’ll be up there (this) month, but it might be the last time I’m up there for a year. I need to focus on St. Clair. It’s a $35 million project, and it needs my attention.”

So-long, red chairlifts

A chairlift tower lies in ruin as a salvage company breaks it down for scrap metal. Photo by Pete Edwards

Since late September, photos of Sugar Loaf’s ubiquitous red chairlifts, dismantled and lying in tall grass, have plastered the popular Friends of Sugar Loaf Facebook page. The iconic symbols of the once popular resort have become a visual metaphor for 17 years of missed opportunities. And now they, too, have been grounded.

Jason Dodge reported on Sept. 20 on the website MiSkiReport that “many of the chairlifts (are) being scrapped and recycled, with employees of the scrap company boasting prices of $300 to $400 for a chair to anybody who wanted to purchase. With Sugar Loaf fenced off under lock and key for the past few months, questions around whether or not the sale of old chairs from the lifts is legit or not are on the rise.”

“The scrapper handling the dismantle and removal is William Fitzpatrick of Superior Salvage Trucking based out of Boyne Falls. It’s up to a scrapper whether or not they haul off the chairs or sell them to private buyers. Obviously, it’s probably in their best interest to sell them to private buyers at $300-$400 a piece and get the scrap price out of larger objects such as lift towers and bases.”

Stay tuned for coverage, and video footage, of Katofsky’s upcoming visit to Leelanau County on GlenArbor.com.