Q&A: David Southworth | Founder, The David Southworth Company

After helping guide Southworth Development for more than 15 years, Southworth decided to go out on his own and made Balsam Mountain Preserve his first project


David Southworth founded Willowbend Development in 1991 with Reebok founder and former CEO Paul Fireman. A year later Willowbend Country Club opened in Cape Cod, Massachusetts. When Fireman retired in 2005, the company became Southworth Development, and a year later took on Joe Deitch as a partner. Southworth Development owns and operates private clubs in Massachusetts, New Hampshire, Virginia, Scotland and Puerto Rico, including Machrihanish Dunes in Scotland, The Abaco Club in The Bahamas, Renaissance in north Boston and Creighton Farms in Virginia. 

In 2021, Southworth sold his half of the company to Deitch and struck out on his own, creating The David Southworth Company with Balsam Mountain Preserve in Sylva, North Carolina, as his first project. He spoke with The First Call about his namesake company and his future plans. The interview has been edited for clarity and brevity.

THE FIRST CALL: What circumstances and thinking caused you to sell your namesake company to your partner and strike out on your own?
DAVID SOUTHWORTH: First, it was all good. Our company was structured in a way where you either bought everything out (from the partner) or sold everything out, versus putting all the pieces up for sale. My son was working in the business, and my partner's son was also working in the business. They had a lot of ideas on different ways they wanted to do things. I really didn't want to hang around and say no to certain things and all that. So, it was just time. I thought, I'll take one more step back. I really wanted to continue on and do development projects, which I had been doing for 30 years by then, and, I really just wanted to do it my way. But I didn't want to stand in the way of the next generation. I thought they had good ideas but I just was comfortable doing things the way I did. So, it was an easy decision to sell my interest in (the company). Obviously, I stay tuned in all the time, and I’m still very close to all the residents and members and employees (of our projects). But it was just an opportunity for me to mosey on down the road and do what I like to do.

David Southworth Headshot.jpg
David Southworth

TFC: In 30 years of doing this in your company, what are the things that you can point to that you learned most that you can carry into this day and age on your own?
DS: That's another good question. Fundamentally, there's two ways to do to develop these types of projects. One is the way I did it — one project at a time. I really dove into each project for two or three or four years, whatever it took to really get it up and running. And by doing that, you end up knowing everyone. It becomes very personal — the employees, the members and the residents. Then you'd get one property on, not automatic pilot, but you build a really good machine. You kind of have the bandwidth to move on to the next project. So, there was a small group of projects with that kind of approach. Over 30 years, there were only so many communities that you could do, unlike Discovery, which could do three times the (number of projects) because it's a different business plan. What the new Southworth Development has done is put themselves in a situation where they can sell on a broader base. It just wasn't my way. I think both ways are right. But I get a lot of reward out of taking these properties one at a time — knowing what's under each rock and knowing all the people. I think I make better decisions that way. It's my comfort zone.

TFC: Speaking of rewarding, is there one project you can look at and say that it was the most rewarding or that you were most you're most proud of?
DS: Willowbend was the first one, in Cape Cod, actually, it's where I am today, where I spend my summers. Paul Fireman and I did that starting way back when in 1991. There's a little bit of Willowbend in all of our other projects. Willowbend is a special place because it was the first and I’ve lived here for 33 or 34 great summers. And then over the years, many times I’ve been asked, “What's your favorite property?” And I never really knew the answer. Then, one day, the penny finally dropped. And the answer was, it was the property where I was at that moment. And I don't say that lightly. I really loved the different communities. I really did. And when I was at community number one, I'd be there for a week or whatever, I just loved every minute of it. Then, I’d typically be going on to the next community. And I was so excited when I got there and realized how much I missed the rolling hills of Creighton Farms or the beaches of Abaco or wherever I was. That's the honest answer.

TFC: Balsam Preserve is your first property under your new shingle. What attracted you to that community?
DS: I've been looking at Balsam ever since it was built, and I haven't been looking at it to buy it. I was just a fan. And the reason I was, we were doing the JW Marriott Starr Pass Resort out in Tucson with Arnold Palmer and Ed Seay. At the same time, Palmer and his group were doing this crazy project in the North Carolina mountains. They were having to lift the equipment around with cranes in the beginning and building a course high up in the mountains, it's not easy to do. While they were working in Arizona, they’d tell us about it and how excited they were. That kind of got me excited, just listening to them. So, I followed the project. I’d read whatever I would see written about it. The project ended up jumping out to a great start. It just was gangbusters, the first seven or eight years, a number of lots for a great deal of money. Then, the 2008 recession hit, and it ended up being foreclosed upon. It had seven years of anything that could go wrong did go wrong. Finally in 2016, a couple who lived at Balsam bought it and they resurrected the property, put $50 million into it, doing all sorts of things and made it worth buying again. So, the timing just lined up. I always admired what the original developers did there, which I thought was just great work and a great vision. I've been able to build upon that.

TFC: What were your priorities from day one at Balsam?
DS: Balsam needed a couple of things. It needed inventory, a good high-quality product, but it also needed the integrity put back into the sales process and the pricing structure. It just needed to find its swagger again. Then, the person we bought it from had bought back a lot of inventory and (took it off the market). We did the same thing before I bought it. I was able to buy another good chunk of lots without people knowing what was happening. When we reopened the doors, all of a sudden, there's now a great property combined with a more stable developer. I think all the pieces started falling back into place. Lo and behold, people started buying and it was very, very, very good to see. It's been fun.

TFC: Do you have plans for the amenities? Do you have things that you want to do?
DS: Well, there's a few things. The club is still owned by the members. I own everything else, the real estate, including some of the amenities like the equestrian facilities and a few other things. But the club, in general, is in pretty good shape. The previous owners put a lot of money into the renovation of the existing facilities. And then they built a new fitness facility, the new tavern, a beautiful restaurant. They put tons of effort into high quality amenities. There's been a couple of little things that the club is doing right now, like adding pickleball, but it really kind of has what it needs. It’s an amazing property in that regard.

TFC: Talk about what has changed over the last 30 years trying to develop luxury properties.
DS: Thirty years ago, we would find a great piece of land, put a nice design together, put a lot of renderings together and, boom, you're in business. We’d open up and people would start buying off the plan. And as you were building, it was fast and furious. But after a couple of resets, that game changed. At that point, it became a “show me” world, in which you’d have to build it and then try to sell it, which makes the barrier to entry much higher and makes it more difficult. I'm glad we started in the early days and added a little momentum by the time the rules changed. In the end, I think we're a much better industry in how things are marketed and sold now. There are even a few more regulations on what you can sell or what needs to happen before you sell, which I agree with, by the way. All those things make it tougher, but I think it makes it much safer investment for the consumer. A lot went wrong in the industry during the couple of recessions that we've been through. Many of those things were corrected. On the other side, current conditions make things safer and better for the customers, which was better for all. And it thins the field out as far as people like me that can do these projects. I think that’s good, too.


TFC: What's the current state of the luxury market? Are there more buyers than there have been in the last few years?
DS: There are, right now. The market is very strong, very vibrant. It's the baby boomers. Our average customers are at the low (age) range of the boomers. They know what they want; they're not using financing. These are second, third and fourth homes. The real challenge is getting the right product pulled together and making it easy for them. And, if you can do that, they will buy it.

TFC: Nationwide, does the luxury market have plenty of inventory?
DS: I don't think it does. COVID kind of wiped out the inventory. There was a big surge in the industry and (developers) that had product, they just kind of pulled through it. Even now at Balsam, for example, we have not been able to finish a home without it being sold. Not that we're trying to do that but it’s obviously a good thing. It's a pretty strong market, and there's really no signs of it letting down. It's a matter of us executing and getting really good product and really good offerings on the market. If it takes an extra dollar or two to really do something special, you're rewarded with even more buyers.

TFC: Is money difficult to obtain?
DS: Not overly difficult right now. We're very fortunate to have banks that we've worked with over the years that we continue to have good relationships with. And so far, so good. Having said that, it might be hard going to Italy and trying to do it put a deal together. But here in the States, it's relatively normal.

TFC: How would you assess the current state of the U.S. economy in your particular market?
DS: Housing, in general, has slowed down and that is taking the pressure off supplies. As little as a year ago, you'd have to order appliances the day you broke ground on a house. There were 12-month lead times on certain things — plywood and two-by-fours were double the norm. The regular market is slowing down and taking a lot of pressure off some of those supplies that we need. And the price in some cases has come down and in most other cases, prices flattened out. But lead times are back to a normal three months. We have a little bit more warehouse space than we used to, so we can hedge on timing. In a strange way, it's becoming a little easier, not so much cheaper. When you go through a recession and inflation, prices go zooming up, and they don't really come zooming all the way back down. They drop a bit, but they don't drop back to where they started from.

TFC: When will you know that it's time to start looking for your next project?
DS: I'm already looking. But we're a year-and-three-quarters into Balsam. And I'd love to have another year-and-a-half. Just focusing on that, to really fine tune it. But we're already doing a couple of smaller things. And there's probably room for another project relatively soon. You never know, it's hard to make the timing be exact. But if we took another one on in the next six to 12 months, we'd probably be OK.

TFC: So is your priority existing projects? Or are you willing to do something from the ground up?
DS: Well, both. I think sometimes there's good ground-up opportunities, and sometimes there's really good existing opportunities. Either one would be in play.

TFC: How long do you plan to do this?
DS: That's a good question, too. I love what I do. I really do. I just recently turned 66 and when I made the move away from Southworth Development, I was somewhere around 62. And I started thinking, what do I want to do in the last third of my life. The two most enjoyable things in my life have been number one, my children and family. And number two, my work, which has given me great satisfaction. I don't collect stamps or rocks. I don't like to garden. I'm not trying to save the world. I don't want to write a book. A lot of things that people aspire to do, I'm not interested in. I ended up starting fresh a little bit on the work side, which was very invigorating and exciting. And after many, many years of being single, I got remarried in 2019. And we even have a new little baby daughter, who's now a year-and-a-half. I say that with a big smile, because I’m doing the two things that I really enjoy doing. I'm a very happy person.