The Kamehameha Schools is exploring the sale of land under the exclusive Robert Trent Jones Golf Club in northern Virginia as it looks to unload several of its underperforming mainland assets. Trust may sell land
under golf clubBy Rick Daysog
rdaysog@starbulletin.comThe $6 billion charitable trust has held preliminary talks with the club's members, who would like to acquire the fee interest in the 18-hole course, considered one of most prestigious golf facilities in the Washington, D.C., area.
The club -- whose members include former President George Bush, U.S. Supreme Court Justice Sandra Day O'Connor, ex-AT&T Corp. Chairman Robert Allen and Washington power broker Vernon Jordan -- operates under a 40-year lease with the trust, but members hold an option to acquire the fee.
A Kamehameha Schools spokesman had no immediate comment. Jordan, the club's president, did not return calls.
The proposed sale was detailed in a recent internal memo listing the trust's underperforming assets.
The memo noted that the trust officials have had early discussions with the club and planned to follow up. It also noted that the trust's initial $45 million investment in the club is now worth about $35 million.
The move comes as the estate is looking to sell off many of its money-losing mainland ventures, which were initiated by the estate's previous trustees during the late 1980s and early 1990s. The sell-off is part of a series of reforms of the trust's investment policies initiated by the estate's current board and Chief Executive Officer Hamilton McCubbin in response to investigations from the Attorney General's Office, the estate's court-appointed masters and the Internal Revenue Service.
The estate recently sold 608 acres of industrial land near Atlanta to a mainland investor, Genoa Realty Services, for about $13 million. The parcel is part of the 1,200-acre Gwinnett Progress Center project, which the estate and its partners launched in the late 1980s.
The trust's board also has approved the sale of its assets in its Treyburn LLC subsidiary. Treyburn is the developer of master-planned residential communities in the Research Triangle area in North Carolina. The estate invested $59.5 million in the various Treyburn projects, but the properties are now worth about $14 million.
For the estate, the Robert Trent Jones Golf Course has not lacked controversy. The club -- the site of the President's Cup international golf tourney in 1994, 1996 and 2000 -- was completed in 1991 by a partnership that included the estate and Durham, N.C., developer Clay Hamner. It was designed by legendary golf course builder Robert Trent Jones. But the club ran into financial problems in 1994, prompting the partners to sell the leasehold interest in the club and its two-story, 40,000-square-foot clubhouse to members. The estate retained the fee interest.
That deal was largely engineered by former Kamehameha Schools trustee Henry Peters, who also served as a trustee of the golf club.
That relationship prompted two club members -- Benjamin Stone and Robert Basham, president of the Outback Steakhouse restaurant chain -- to sue Peters and other partners, saying the fee price was too high and that Peters had a conflict since he served as a trustee of both institutions.
Peters denied the conflict, saying he recused himself from taking part in the transaction as a Kamehameha Schools trustee. The suit was settled after club members were given a favorable, 40-year lease and an option to buy the fee interest.
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Kamehameha Schools
