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Downhill run for Sugar Loaf: Property decays and owners dither

The Sugar Loaf resort, in the heart of Leelanau County, offers views that would make most communities envious. To the east, Lake Leelanau’s elegant finger runs up the spine of the peninsula. To the north, Good Harbor Bay and Lake Michigan are a vista of blue. Apple and cherry orchards and farmland surround this mountain in the place the Native Americans called “the land of delight.”

But Sugar Loaf’s chairlifts sit idle, their wooden seats and red paint chipping away as the seasons pass. The only skiers and snowboarders here are thrill-seeking trespassers who scale the mountain on foot. The warming huts at the top of Sugar Loaf are boarded up, with broken beer bottles and bonfire pits decorating their interior.

Elsewhere in Leelanau County, tourism and business are booming. “Good Morning America” dubbed the Sleeping Bear Dunes National Lakeshore as “the most beautiful place in America” in 2011, leading to record tourism the following summer and record profits for area restaurants and shops. Nearby Traverse City draws visitors from around the world to its film and comedy festivals, and its wineries and unique restaurants.

Against this backdrop, Sugar Loaf, listed by a local realtor at $8.7 million, remains the (white) elephant in the room. The resort once supported hundreds of local jobs during the cold months of the ski season, when warm-weather tourists stayed away. Like the abandoned Packard Plant in Detroit or the Hiawatha Iron Ore Mine in the Upper Peninsula, Sugar Loaf’s remains are now a blight on the landscape, a missed economic opportunity for the region and an embarrassment to its community.

Closed since 2000 following a string of light winters, Sugar Loaf has been courted and abandoned by a revolving cast of mysterious owners and suitors with backstories that read like a crime novel. The resort’s would-be saviors have included a convicted felon, a Las Vegas tax cheat and his new wife, a teenage lounge singer from New Zealand, the owner of an addiction treatment center and religious squatters. None have been able to reopen the place and, even today, nobody is precisely sure who owns the resort.

Making Sugar Loaf’s revival even more remote is a disastrous business deal that divorced the ski hill and lodge from the nearby townhouses, golf course and wastewater treatment plant, lessening the ability of any would-be owner to earn warm weather income from the resort.

“Everybody’s just sick of the dog and pony show,” says Karl Kitchen, who runs the “Friends of Sugar Loaf” Facebook page, which boasts 1,825 members. “They’re sick of the circus that has surrounded who owns it, and what’s gonna happen to it. Sugar Loaf Resort, as far as Leelanau County is concerned, is a fruit rotting on the vine, and people are getting sick of watching it rot.”

The latest tease

The drama escalated last September, when Eneliko “Liko” Smith claimed that he owned Sugar Loaf. Smith is a former Olympic-level Samoan boxer and West Coast hotelier whose previous business deals have failed, and whose personal life has played out poorly in reality television shows. In 2009 Smith lost The Block Hotel in South Lake Tahoe, on the California-Nevada border, to creditors, and was accused of failing to pay $130,000 in room taxes. Smith was charged with a felony which lead to a plea deal. Authorities in El Dorado County, Calif., later had a warrant out for his arrest for violating terms of the probation.

Smith had first introduced himself to Leelanau residents in 2010, following the collapse of The Block, when he appeared at Sugar Loaf with his newlywed wife, a 19-year-old New Zealand lounge singer he had met in Las Vegas. He boastfully courted local media and local investors. Admitting that he “Googled poorly,” Smith vowed he would buy and re-open Sugar Loaf by the following winter.

Like the abandoned Packard Plant in Detroit or the Hiawatha Iron Ore Mine in the Upper Peninsula, Sugar Loaf’s remains are now a blight on the landscape, a missed economic opportunity for the region and an embarrassment to its community.

Despite initial claims to the contrary, news emerged that Smith was a business associate of a previous and equally colorful owner of the resort, Remo Polselli, a Southfield hotelier with properties in Detroit and southern California who served time in 2003 for failing to pay taxes. Polselli owned Sugar Loaf from 1997 through its closing in 2000. In 2005, Polselli appeared to have sold the resort to Kate Wickstrom, a Leelanau County native who ran an addiction treatment center near Grand Rapids but never found the means to re-open the resort. Wickstrom stopped paying taxes on the property, but Polselli’s wife Hanna Karcho, who it turns out had secretly co-signed the mortgage, paid back taxes to Leelanau County in the eleventh hour to avoid losing the property.

Smith, tarnished in the eyes of some Northern Michiganders by his connections to Polselli, held a fundraiser in the spring of 2010 at Red Ginger, a downtown Traverse City restaurant, but failed to secure much interest in co-financing the project. He left the restaurant without paying his bill.

Most of Northern Michigan figured they would never hear from Smith again.

And the resort continued to gather cobwebs. Local residents longed for the days when chairlifts transported them to the top of the mountain. Sugar Loaf had been a cherished stop for generations of Michigan skiers, with its own compelling backstory. The resort was founded just after World War II by a group that included Hans “Peppi” Teichner, a Jewish member of Germany’s national ski team when Hitler came to power. During the Spanish Civil War, Teichner helped those fleeing Franco’s fascist regime elude capture by skiing to freedom over the Pyrenees. He and his wife finally settled in Glen Arbor and helped open the resort in 1947.

After the Smith drama and false starts of 2010, rumors quieted for a spell.

The boxer returns

Then, last September, a press release written by Liko Smith began circulating the Internet. Smith announced that he and a team of partners had acquired Sugar Loaf and would turn it into a 560-acre snowboarder’s mecca called “The RoK at Sugar Loaf” and open by Thanksgiving 2014. The resort’s appeal would be decidedly young, edgy and altogether California.

The RoK at Sugar Loaf’s Facebook page circulated a video that interwove pristine aerial views of the mountain with shots of Las Vegas strippers straddling Smith. Subsequent press releases claimed that Smith planned to bring in Israeli filmmaker Elan Frank (creator of films about the Israeli air force and Sarah Palin) to shoot a reality TV series at Sugar Loaf.

By early October, a would-be co-investor named Oscar Peters, who was working with Smith to develop a luxury Las Vegas airliner called LV Air, told the Glen Arbor Sun that he had never set foot in Northern Michigan and had never heard of Sugar Loaf. He announced that he would separate all ties with Smith.

No evidence existed that Smith owned Sugar Loaf. Kate Wickstrom’s name was still listed on the title at the county’s Register of Deeds office. Wickstrom maintained that she had transferred the title back to Polselli in March 2013, but he never registered it with the County, fueling speculation that he was pulling strings behind the curtain.

Meanwhile, local residents expressed concerns about the safety of the decaying resort, leading to speculation that Smith, and perhaps Polselli too, wanted to act before Leelanau County Construction Code inspector Steve Haugen could inspect, and perhaps condemn, the lodge and hotel and seize the property. Smith told a reporter that he feared Haugen was about to summon the bulldozers. Prompted by a complaint from the Sugar Loaf townhouse association, Haugen secured permission from a County judge in December to inspect Sugar Loaf, with or without the resort’s owner, whoever that was.

But anyone in Leelanau County who wanted local government to condemn and seize the long-shuttered resort faced an uphill battle. The seven-seat County Commission, controlled by small-government, Tea Party activists, expressed concern with Haugen’s efforts to inspect Sugar Loaf, with some citing United Nations conspiracy theories as a basis to thwart economic development plans in general.

Even so, Smith announced that he would triumphantly return to Northern Michigan on Jan. 31, tour the property and prove to Haugen that he owned Sugar Loaf. That day, he broadcast on Facebook and told local media that he would hold a public meet-and-greet during karaoke night at a local bar called the Cedar Tavern.

January 31 came and went. With an extraditable warrant out for his arrest in California, and no evidence ever made public that he owned Sugar Loaf, Smith never showed. Just in case, at 1 p.m., Leelanau County’s undersheriff waited by the ski hill, presumably to arrest Liko Smith and send him back to California in handcuffs.

On Feb. 5, Haugen quietly entered and inspected Sugar Loaf. He concluded that the resort suffered cosmetic damage but was structurally sound and clear of sewage or rodent problems.

Joining the inspector that day was realtor John Peppler, who later that week revealed that he was acting on behalf of Polselli, who currently lives in Laguna Beach, Calif. Through a corporation called Rock Investments Advisors, Polselli is now again claiming he owns the resort and is reportedly fielding offers this month from two potential buyers.

Leelanau County residents and northern Michigan skiers, wary of being burned again, can only sit back and hope that a real buyer will emerge, with concrete plans to reopen Sugar Loaf.

“The location is great and it’s beautiful,” says Mickey MacWilliams, executive director of the Michigan Snowsports Industries Association.“We’d all love to see Sugar Loaf come back because it was a really cool place. I think the ski industry would take interest if it ever did come back. It’s a special place.”

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