How Southern Trace became Southern Trace again

By JOHN JAMES MARSHALL/Designated Writers

It was a few decades ago when a 12-year old boy would walk out of the back door of his house and see, what was to him, golf heaven. He lived along the 10th fairway and could see the best that a golf course had to offer anywhere in the area. Once a year, he could even watch the professional tour come by from his back yard.

This was something his hometown had never seen. A premier golf course inside a gated community that had made an immediate impact. This was special, and those involved weren’t short on pride.

There was no shortage of attention to detail, especially for the golf course. For a 12-year-old who already loved the sport, it really didn’t get any better than that.

Little did that boy know that years later, he would play a role in making that happen all over again.

IT WASN’T LONG after Southern Trace Country Club opened in 1988 that it was recognized as the top facility in Shreveport-Bossier and among the finest in the state. Once, just a few hundred acres off Norris Ferry Road in southeast Shreveport, the attraction of a championship course in a gated community gave Southern Trace a status that it enjoyed for a long time.

Until it didn’t.

This is the story of how a group led by an independent oil and gas producer, an accountant, a banker and a lawyer – after a dentist had started a grass roots effort – did what didn’t seem possible a few years ago. Not exactly the occupational qualifications you’d draw up to try to buy a country club from its corporate owner. Nor was it exactly the best time – economically and socially – to try to pull this off.

But this summer, there were a lot of people celebrating when the ink dried on the papers that officially sold Southern Trace Country Club from Club Corp of America to its members. That celebration didn’t last long.

“Now it’s time,” says Steve Skrivanos, who has led the purchase group, “to get to work.”

Of course, there are all sorts of goals and objectives for the “new” Southern Trace. There are numbers to meet for membership, renovations to be done and money to raise. Fix this, improve that.

All well and good and completely expected from a transaction such as this. But if you really want to know what this is all about, don’t get caught up in all of that. It’s far more abstract than that.

“We know what it can be, because we know what it’s been,” says attorney Alexander Mijalis, one of the driving forces behind the purchase. “It’s unfortunate that we have put up with mediocrity for so long. There’s a whole generation of members who don’t know what it can be and think what it is now is acceptable. And it’s not. I can tell you that the standard that we have is not mediocrity. That’s not going to work going forward. For anything. And it is going to get back to the way it used to be.”

Somewhere along the line, Southern Trace lost that. Ask almost anybody involved when it happened and be prepared to get a variety of answers. But there is no doubt that the country club was not what it once was.

Somebody had to start the process. And a dentist did just that.

IT WOULD BE easy to say that it all began in the summer of 2018, but the shift actually evolved over time. There were little things that some may not have noticed. There were big things – irrigation, drainage, cracks in the ground, lack of grass – that everyone noticed.

“When the club opened, everything was brand new, so nothing broke,” says Rusty Palmer, who was a member of Southern Trace even before the golf course opened. “The air conditioning was brand new. The pool deck was brand new. The golf course was brand new. But anything that’s 25-30 years old starts to wear out and needs maintenance. The membership just felt like we needed more maintenance than when we were getting.”

So Palmer, a local dentist, decided to form focus groups at his house to discuss the concerns. “There were people more qualified than me,” he says, “but nobody was willing to do it.”

Through various surveys of the membership, Palmer began to feel the groundswell of support and decided to have a meeting at the LSU Shreveport auditorium for those who might be interested in trying to bring about some needed changes.

Palmer had a 45-minute Power Point presentation ready to go, but had no idea how many would show up. “Not the slightest idea,” he says. “Wouldn’t have been surprised if three people showed up.”

Instead, there were 250.

“I knew people didn’t want to hear me complain without a solution,” Palmer says. “I had a list of what needed to be done and how to raise the money to do it. We passed out a petition for people to sign, which almost everybody did, and a committee was formed from there.”

That committee presented its list of complaints and the reaction of was immediate. Club Corp’s regional executives reacted quickly and a four-hour meeting was held that December. Promises were made, Palmer says, but there was little improvement. “They just kept kicking the can down the road,” he says.

More issues arose from promised improvements that weren’t made and finally, Palmer had a one-on-one meeting with a Club Corp executive. In the midst of a flurry of non-flattering adjectives, the exec mentioned “then you should just buy it.”

Whether or not that was a possibility – there had been three separate attempts in the past —  Palmer knew it was it was time to hand it off to someone else.

“They (Club Corp executives) figured I would eventually go away,” Palmer says, “but they didn’t know me.”

WHERE DO YOU start? There was no handbook on how to purchase a country club, so getting the right people in place was going to be essential.

Skrivanos, an independent oil and gas producer, had been involved in many local civic projects, so the challenge didn’t scare him off. “At first I didn’t know if was possible,” he says, “but I told Rusty I’d look into it.”

Jack Taylor, who moved to Southern Trace 10 years ago, had been the chief operating officer and executive vice chair of U.S. Operations for KPMG from 2005 to 2010. He was no stranger to putting together large corporate deals. “The unique thing about Southern Trace is that it is totally integral to a community with 550 homes, so it’s the heart and soul,” Taylor says. “But not only that, there’s probably 2,500 homes within two miles of there. So, it’s really an important piece of the whole community.”

Steve Walker had been president of Commercial National Bank in Shreveport and later was the national head of domestic corporate lending for JP Morgan Chase. “The reason I got involved is that I realized we have the opportunity to create something here that is every bit as good as the places you would go travel to,” Walker says. “We can create that here not only with golf, but with tennis, the pool, food and beverage … it’s the whole experience.”

Mijalis is a local attorney, and since he was in his late 30s, he was tuned in to the younger members of the club – a needed connection to help make this project work.

Four men with varying levels of expertise and with different perspectives. “You couldn’t have put this team together,” Skrivanos says, “at any price.”

“Restoring the club to excellence can help instill pride in the community and show that we can make a difference,” Taylor says.  “To be a successful country club, you have to be more than a golf course. You have to be a family-oriented entity that focuses on the needs of all of your members. Everybody is looking at ways of doing that differently. People have lots of ways they can spend their time, and you have to make a country club more than it was in the past.”

“I was disappointed with what had gone on with the golf course, but to me, it was such a bigger deal than that,” Skrivanos says. “You look at the other places that have become daily-fee courses and it has had a dramatic effect on property values. It would have had a terrible effect on the $250 million of property values at Southern Trace and negatively impacted our city and our ability to attract new businesses. If we couldn’t drive a stake in the ground right there, the downside would have been unimaginable.”

But for Mijalis, who is more than 20 years younger than anyone else in the group, there was an added motivation. “I’ve spent a lot of hours on this,” he says. “And I’m not being paid. But that’s OK, because my compensation is learning from these guys who have a wealth of knowledge. To be able to glean from them … that’s my compensation. Working with those guys, seeing how they operate, learning lessons from them that you only get from experience.”

All well and good, but there was still very important question – was Club Corp willing to sell? The first indication that it was a possibility came from Palmer’s one-on-one “conversation” with a Club Corp representative. But that could have just been heat-of-the-moment proposition.

The group knew that Club Corp was acquired by Apollo Global Management, a hedge fund based in Arizona. “They aren’t in the business of operating a golf course,” Mijalis says. “They are going to sell to somebody. Is it us? Is it somebody overseas? We knew there was an opening.”

Even better was that Taylor had worked with Apollo before on transactions during his time with KPMG in New York, so he had a knowledge of how Apollo typically operated.

“Jack had some keen insight into who they are and what they do, and he felt pretty strongly that in the next three to five years they would be selling,” Mijalis says. “And most likely, it would be geographically and in clusters. But we aren’t in a geographic cluster. We are an outlier. Which has always been a problem for why we don’t get any attention over here.”

Negotiating the purchase, getting financing and bringing in founding members all occurred simultaneously. The group was able to raise money for both the purchase of the club and capital improvements through three different membership levels. But it wasn’t easy.

“As soon as we got a letter of intent, we had no way to communicate with the members,” Taylor says. “You couldn’t have open forums. You could send emails, but we didn’t have the right email list. There was always mis-information and other things going on. That was a real problem for us.”

“This was quite a cumbersome transaction,” Mijalis says. “There’s a lot of stuff going on. A lot of things that had to be done and decisions to be made on behalf of 850 other people. I understood that, but I was probably not prepared for some of the reaction we got. But at the end of the day, we had the right intent and the right decisions were made in those moments. I would have loved to explain to everybody what was going on, but the dynamics of that transaction didn’t allow for that to happen.”

“It doesn’t seem like it would be complicated,” Skrivanos says, “but it was much more complicated than I thought it would be from the outset.”

And it was about to get more complicated. You’d think it would have been as simple as buying a business, moving in and picking up where the previous owners left off. “But it didn’t work that way,” Taylor says.

When Club Corp left, so did everything else – IT, accounting, equipment, human resources. All the members had to be re-enrolled. Codes had to be re-programmed. And where was the list of the Monday scrambles?

“They were only selling the shell … the buildings, the golf course and so forth,” Taylor says. “All of those things I had done in the past in the business world, but I always had that infrastructure behind me, and it all got done. Here, we didn’t have that many warriors.”

But they found their warriors by hiring Troon Prive, which describes itself as “an alternative to self-management by contributing resources and working collaboratively with boards, owners, and members to define and deliver each club’s unique vision.”

It’s one thing to have vision. It’s another to have the money to pull it off. There was one other small detail hanging out there – how to pay for that vision.

The first call that was made was to Larry Little, Origin Bank’s Louisiana State President. As it turned out, that was the only call that needed to be made.

“He understood what was at stake here,” Skrivanos says. “On the spot, he agreed to finance the deal as well as become a founding member. That was really a remarkable moment for me because he got into it immediately. He grasped the totality of what was at stake here. It was more than just the country club; it was about the total value of how important it was to southeast Shreveport.”

“When you stop and look at who is involved in leading this effort, why would we not want to be affiliated with these people?” Little says. “They put together a nice structure that made sense. It’s a very attractive transaction and opportunity for an organization like ours. It’s the right thing to do for the community.”

During the early part of 2020, despite all the obstacles, financing fell into place. Memberships fell into place. And, at last, the negotiations fell into place. “A deal that was favorable to both us,” Skrivanos says.

“We never budged,” Mijalis says. “At all.”

Now it’s time for what’s next.

AND SO IT begins … again. Southern Trace 2.0 is now a reality. The immediate past is quickly fading from view as those involved focus on making the country club what it was once all over again.

“What these guys have done collectively for the common good with their time and resources to make it happen has been tremendous,” Skrivanos says. “With the deep-dive analysis we did, I feel like we have a real good handle on where we are. I think we understand the downside issues better than we understand the upside. I believe we have the structure of what could be a very, very successful operation.”

“There’s a satisfaction in doing the deal, but we are just starting with this vision of all the things we want to do,” Taylor says. “We are 10 percent there and there is an enormous amount of work that needs to be done.”

“The challenge was much bigger than I expected it to be,” Walker says. “You are basically starting at zero. What about stocking up on hamburgers? What about an alcohol permit? Anywhere you turn, there are a thousand details to deal with or set up and start new. Troon was a big help. I don’t think we could have done it without them.”

There are immediate plans for capital expansion. A needs assessment will be done for the clubhouse, golf course, tennis courts and pool. Improving and expanding food and beverage is a high priority.

“We are now in position to invest money back into to it and there is a genuine excitement now,” Skrivanos says. “We can protect those property values and move forward.”

A board of directors has been put in place (Skrivanos is the president) along with various levels of membership. There’s a fulltime membership director.

“We do have a laundry list but it will be up to the board to prioritize them,” Skrivanos says. “As we develop our economic model, we will figure how we want to go forward. This is not going to be something that is done by fiat. What I think doesn’t matter. It’s what the board thinks and what the membership thinks.”

Well, there is one item on Skrivanos’ list. “I did insist that we deep clean the entire facility from top to bottom,” he says. “Making the facilities clean and the air conditioner working is clearly our top priority.”

Graham Kornmeyer, a new course superintendent, has been hired, and there are high expectations for how the golf course can be improved. “We know we are going to rebuild the greens at some point,” Skrivanos says. “But we don’t know how good the greens can be now if we did the remedial work with sound management. We are trying to allocate our capital needs. But it all starts with independent assessment of the facts.”

Selling the vision, both internally and externally, is a primary focus. Internally, there’s a large number of homeowners inside the gates who are not members. And then there are those members who don’t even use the amenities, especially food and beverage. “The people who are members don’t use it because the services haven’t been up to par,” Skrivanos says. “It was not under good care before, but that will not be true going forward. Not only are we looking for more members, but for a greater membership experience. It’s got to start with a successful food and beverage operation both in the clubhouse and at the pool.”

But the true vision extends beyond the 18th green and the property gates.

“It’s important to me because I’ve seen the city really give up too many of its important assets over the years and not protect the things that drive our economy going forward,” Taylor says. “There are things that contribute to the community to make this a better place that are very important. What I saw out my back door was one of our crown jewels – which is what I consider Southern Trace – just be devastated by poor management and a robber-baron mentality with investors from outside the city.”

“Just to be a part of a team working to save our city for the long term is the reward for me,” Skrivanos says. “The depth of the team and the level of executives we were dealing with to get this thing to the finish line is as good as I’ve seen in any project I’ve ever been involved in. It’s been an A-list of people and I’ve been delighted to be associated with them.”

“What it says is that we have a membership here that is engaged and wants this to work,” Walker says. “They know what it can be and they are willing to do whatever it takes. They have seen the opportunity and they want to be a part of it.”

“I’m so excited that I can hardly stand it,” Palmer says. “This is long overdue. I knew what this place used to be and it was magical, at least for me it was. I think it’s finally going to be what the members wanted it to be.”

AND THEN THERE is that 12-year-old boy who used to watch golfer after golfer go by on the 10th fairway from his backyard. He always knew that it was a place that was special to him, but as he grew older, he watched all of that slowly begin change.

His wasn’t the story of so many others; he wasn’t one of the 30-and 40-somethings who bought a house at Southern Trace a few decades ago. His perspective of those days was that of a kid, who could go out and play a few holes before dark or spend a summer day at the pool.

He grew up, went to law school and came back to Shreveport to practice. Two years ago, he bought a house on the 11th fairway, right around the corner from where he grew up.

Alexander Mijalis was back home. Not back home in Shreveport; back home at Southern Trace.

“This is my forever house,” he says “I’m not going anywhere. Yes, I want a better golf course; yes, I want a better clubhouse. But the driving force for me was to protect my house. Fundamentally, the transaction is the same as ones I’ve done before. The fact that it’s personal … that made it a little bit different.”

And a lot more special.