Athletic club hasn't taken shape

It was a grand vision of swimming pools and children's athletic amenities, a promise to affluent homebuyers to build, as a marketing brochure put it, the "finest private club in the entire Sacramento region."

Now, in a hilly Lincoln neighborhood of $800,000 to $1.3 million homes, it's a portrait of how infighting can overtake even the most upscale developments.

There is no beautiful hilltop athletic club within a shout of the Catta Verdera Country Club and its signature golf course. Though backers say they remain committed to building the club, the Placer County site with a view of oak-dotted hills and the downtown Sacramento skyline far to the west is dusty and raw. So are the hardening feelings of some residents who believed their sales brochures.

"My philosophy in business is you should underpromise and overdeliver," said Brett Korsgaard, a former Bay Area resident and independent investment adviser who moved into the Verdera neighborhood a year and a half ago. "This is just the opposite."

No one will say exactly why the 10,000-square-foot athletic club and its companion 4,000-square-foot children's club didn't get built as promised by autumn 2005. But now the dispute has landed in court, involving residents who bought their homes with the promise of an athletic club, the home builders who touted it in their marketing and a pair of prominent commercial and golf course developers who dreamed it up. For all sides, the issue has become something of a blame game and a campaign to come out on top in public opinion.

"This will get out," Korsgaard said about the potential impacts of a long-delayed amenity. "The reputation will spread."

On Aug. 18, Sacramento-based JTS Communities Inc. filed a lawsuit against Catta Verdera-Athletic Club LLC in Placer Superior Court. A homebuilder with 121 lots in the project, JTS seeks a court order forcing the firm to build what JTS promised its customers. A court date has yet to be scheduled.

"This wasn't a vague promise. It was very well developed what the homeowners were supposed to get for that money," said Roseville attorney Glenn Peterson, who represents JTS in the lawsuit.

Korsgaard and other homeowners, who signed waivers recognizing that the club might not actually get built, are not part of the lawsuit. But the investment adviser said he was told when signing the waiver, "There's no reason why it won't get built. They reassured me."

Homebuilder JTS continued the reassurances, Korsgaard said, during a year of questions and telephone calls. Now both are trying to prompt Catta Verdera-Athletic Club LLC to make good on its plan for the facility, tennis courts, fitness center and gym.

The Sacramento-based company is owned by developers Andrew Sackheim and Christopher Steele. Steele bought the Catta Verdera golf course in 2002, eventually produced an upscale country club there, and home builders bought lots surrounding it.

The financing plan for the Steele and Sackheim vision of an athletic club rested on gathering $5,000 from home builders for each of the 539 homes at Verdera -- nearly $2.7 million in all. Most of the homes are built and most of the money has been collected.

If built, the club would join a growing trend in the region to add athletic centers to new suburban communities such as Lincoln Crossing in Lincoln, Whitney Ranch and Whitney Oaks in Rocklin and the Sun City retirement neighborhoods of Lincoln and Roseville.

"They're not real prevalent, but they're becoming more so," said Kathryn Boyce, a Sacramento analyst at Hanley Wood Market Intelligence, a firm that tracks home building trends. She said community athletic clubs are big in Texas and Colorado.

Sackheim did not return telephone calls seeking comment. But in a statement e-mailed to The Bee, he called the JTS lawsuit "meritless" and "intended solely to give the appearance of pacifying its homeowners."

He also cited another Verdera home builder as a cause of delays. Though Sackheim didn't name the company, Dallas-based Centex Homes collected nearly $500,000 for the club from its 93 homes at Verdera -- and recently started giving the money back to homeowners.

In an e-mail, Sackheim wrote, "One of the developers, representing a significant portion of the necessary funds, elected to withdraw from the agreement thereby making performance under the terms of the original agreement by Catta Verdera-Athletic Club LLC and each of the other developers infeasible."

Sackheim also noted that none of the builders that collected funds for the club has actually contributed the money to the limited liability company to help build it. Besides Centex and JTS, other builders include Richmond American Homes of Denver and some local custom home builders.

Richmond American could not be reached for comment.

Peterson said JTS isn't required to hand over its collection until the athletic club partnership "provides us with a full executed construction contract" and "also a building permit by the city of Lincoln for construction."

"None of the conditions has been fulfilled," he said.

At Centex, Sacramento division president Doug Pautsch said the company has a similar performance agreement before it hands over the money. Centex put the money in a special escrow account with the condition of returning it if the club wasn't built within two years of the sale.

"A year and a half ago nothing was going on," said Pautsch. "We knew our window was coming for refunding the money, and we started pressing for legal action."

Pautsch said Centex lawyers were unable to force construction.

Sackheim said by e-mail the JTS lawsuit is likely to lead to more delays. George Dellwo, assistant development director for the city of Lincoln, confirmed a meeting last week with Sackheim to discuss construction on a nearby site.

Dellwo said the size of the facility wasn't discussed. "We talked about general site issues and what the entitlement process would be," he said.

About the writer:

• The Bee's Jim Wasserman can be reached at (916) 321-1102 or jwasserman@sacbee.com.