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Pickleball Court Project Update

This extended update is overdue. And we apologize for not getting it out sooner. I know that many of you just want to play, but others care about the details, so here we go.

Let us backup and give a little history of the new court building project (all numbers are USD).

Last August, 2021, James Main, our Club President and other Board members, recognized that because there were so many new houses at Mirador, we would soon lose our ability to play there. We needed to come up with a solution. He suggested to the board that we purchase our own property. At that point, we had under $20,000 in our bank account. But we had faith that the board and the community could get this much needed project done and we were willing to put in the enormous amount of time required to see it through..

So, we did not start the project with half a million dollars in the bank, or with government backing, but with faith in ourselves and the community and with an understanding that if we didn’t at least try, the pickleball community would soon have nowhere to play.

The board began looking into available land. We found a landowner, John Fouts, who was willing to sell us 9,000 square meters of land at a very reasonable price ($25 / square meter for a total of $225,000 owing) and who would also allow us to pay him under a payment plan.

The deal that John Fouts made with us is to pay him $45,000 every year for 5 years. So, John Fouts still owns the land and we are paying him annually. We just made our second of the five payments on October 31st, 2022. That agreement was prepared in Spanish by the Club’s Lawyer, David Peralta.

Who will own the land? On the advice of the lawyer, the Club will own the land. San Carlos Pickleball Club, AC is a registered corporation in Mexico (Asociación Civil) and has complied with all Mexican legal requirements as advised by David Peralta.

We are building on approximately 5,000 square meters of the land and have 4,000 square meters of land “extra”.

We tried raising money within the community and many of our club members generously donated but it just barely scratched the surface of what we required to even begin the project. This is the money we raised locally:

  • 45 people bought 5 year memberships for $750 per person ($33,750 total);
  • Brick donations: 35 at $1,000, 3 at $500 and 11 at $250 for a total of $39,250;
  • $4,901 through GoFundMe,
  • 6 local companies donated $5,000 for court sponsorship (see a list of these generous companies below); and
  • 2 individuals donated $20,000 each.

This total of $147,901 from the community was a great start, but not enough to build the courts.

To keep the dream alive, a couple very generous pickleball players came forward and loaned the club $225,000. The terms are extremely reasonable. We do not have to start paying that money back until we have finished paying for the land. And then they are accepting the same annual payment of $45,000 a year at only 3% interest until the loan is paid off.

For a total of $372,901 in donations and loans (but the donations weren’t one lump sum, it has trickled in).

Still, we did not have enough money to complete the project, but we had enough to get started.

Here are the main outlays of cash to this point in the story:

  • $45,000 for the first installment to purchase the land;
  • $45,000 for the 2nd installment to purchase the land, which we set aside to ensure we could meet this obligation;
  • $2,390 to clear the land;
  • $1,110 to hire a local architect / engineer to do a blueprint of the perimeter wall and conduct a survey / topographical study to allow us to take into account things like water flow over the property and slope of the land;
  • $56,000 to that engineer to build the retaining wall;
  • $64,100 to have the area filled and compacted;
  • $10,850 to the engineer to waterproof the retaining walls, oversee the fill & compaction and fine-tune the grade of the land;
  • $13,035 to have electricity brought to the land, including a transformer, 3 poles & 2 mufas;
  • $13,250 to Carolina Block for all the brick for the wall;
  • $610 to get water pipes to the land plus $147 to CEA for the initial contract;
  • $36,552 to build the wall ($17,922.24 down at this point);
  • $199,783 to build the courts (60% down at this point = $120,000);
  • $3,560 for complete architectural plans; and
  • Various other outlays for permits, compaction tests, accountant, lawyer and incidentals.

If you’re following along with the math, you see that we’re at over $392,974.24 spent by this point.

To complete the entire project, we needed more money. We still owed the contractor $18,629.76 for the remainder of the wall and Proyectos $79,783 for the courts.

We approached local companies, pickleball companies, the government – anyone we could think of who could help fund the project.

Ryan Kuiken, who is on the Board and Darren Thompson who has always been a key person in the pickleball community, offered to form a management company with Rocio Celaya and Mariel Rivera to manage the future pickleball courts. They offered to invest $75,000 and to work as the management team. In exchange, we will eventually be splitting profits with them. They have agreed that the first $45,000 raised each year goes to the Club so that we can meet our land purchase and then our loan repayment obligations. At this point, they have basically bought themselves jobs. They will be working for possibly many years before they will start to see any return on their money because they believe in this project and want to see it succeed.

As a further money making option for the club, Darren suggested that we sell the “extra” 4,000 square meters of land to him and a purchase group (including Ryan, who is on the Board). We asked Vive Real Estate and Seaside Real Estate to determine a fair market value for the land. Vive Real Estate’s assessment was $40-45 a square meter and Seaside’s assessment was $45-50 a square meter.

The prospective land purchasers offered us $47.50 per square meter. We have to remember that we won’t even own the land for another 3 years. Even though we can’t fully sell the land to the purchasers for another 3 years, they agreed to prepay $100,000 of the purchase price to us to help us complete the courts. They are putting their trust in the Club that when we own the land we will sever it and sell the remainder to them. At that time, they will pay the remaining amount owing and we can put it towards the loan.

The board voted on these proposals with Ryan abstaining and they passed unanimously. Both of these agreements have been put in writing by David Peralta. The land purchase agreement has been signed and the management agreement is a Memorandum of Understanding and we are finalizing the paperwork. Most of the $175,000 has already been transferred to us.

We now have the funds to pay all outstanding contracts (we’ve already paid the remaining $18,629.76 owing for the wall) and to move forward with the buildings. We have almost finalized the plans with the architect and have permits for the front buildings. We will now get quotes for those buildings and for the center walkway area.

The management team are responsible for the organized afternoon play that had begun at Mirador. They brought a lot of energy and excitement to the Club. Just think what they’re going to be able to do when they have 14 courts to work with. But their job won’t just be organizing play, the management team will also take over responsibility for maintenance, membership, etc.

Rest assured, at the new facility and at Mirador (if we can play there again), we will continue to have Open Play and many other fun events. We want the Club to be a welcoming place for all pickleballers from rec player to pro.

So, why isn’t the court construction company at work now?

As we reported in the last newsletter, Proyectos is supposed to send us a new timeline and proposed payment plan. We’ll share that with you as soon as we have it and are working to get them back here asap.

What’s left to do on the almost complete 7 courts? One more slurry seal and 3 coats of paint. Then install fences and nets. Hopeful time frame is 4 – 8 weeks.

What about Mirador?

We continue to be open to negotiating with the new HOA and are hopeful that we can find a win-win resolution asap.

If you’re on Facebook and not yet a member, please join the group. It’s easier for us to throw quick updates there.