LEECH LAKE – Big Rock Resort lies hard by the shores of this giant northern Minnesota lake, a fixture in the region since its founding in the 1930s. Owned over the years by dreamers transfixed not only by the tall pines that surround the lake, but also by the walleyes, northern pike, largemouth bass and muskies that inhabit its waters, Big Rock today is testament to the benefits of hard work and ingenuity, North Woods-style.
Hard work because no resort business survives one century to the next by accident. Cabins must be built and updated. Docks twisted by heaving ice must be repaired. And outboards must be maintained so guests aren’t stranded while jigging for dinner.
All of which is business as usual in the resort game.
What’s unusual about Big Rock is its corporate structure, which in recent decades has helped it survive — even thrive — while similar-sized tourist destinations across the state’s north have struggled to stay afloat.
“We have 32 owners of the resort,” said Marty Andreasen, who with his wife, Mary, manages Big Rock — and owns part of it, too.
Organized since 2006 as a commercial common interest community, Big Rock’s 20 cabins are owned by individuals who want not only to relax periodically alongside one of Minnesota’s most beautiful lakes, but want also, at year’s end, to realize a profit from their investment.
For some cabin owners, the notion that a home-away-from home can pay, and not just cost, is the stuff of fantasy. Many part-time lakeshore residents soon view their getaways as equal parts work farms and money pits.
Resort owners have had their own crosses to bear.
To stay in business, many have learned to cater to evermore demanding vacationers, including families with young children. Television-equipped cabins. Resortwide Wi-Fi. Swimming pools. Play areas. The list of amenities grows as more resorts transform from fishing camps to year-round entertainment centers — where casting for muskies or trolling for northern pike are just two of many recreational options available.
Many smaller outfits have been unable to keep up with high-end destinations such as Grand View Lodge Golf Resort and Spa on Gull Lake near Brainerd and Arrowwood Resort Hotel and Conference Center near Alexandria.
So when lakeshore values began to skyrocket in the 1990s, many smaller resorts sold out to condominium developers or private parties wanting to build large homes. Which in part explains why the number of Minnesota resorts plummeted by 26 percent between 2000 and 2010, losing nearly 300 businesses, according to the Federal Reserve Bank of Minneapolis.
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Jerry Emery grew up in Minnesota, and when he retired nearly 20 years ago as a landscape architect living in California, he and his wife, Sandy, wanted to return to Minnesota for at least six months a year.
So in 1996, the Emerys bought Big Rock Resort and operated it for about 10 years before they, too, considered selling.
“During that time we learned firsthand that resorts like ours were important to a lot of people, not just us,” Emery said. “Still, given rising lakeshore values, it got harder and harder to justify using the property for a resort. Just about every resort we knew was selling out, or thinking about it, to be demolished and replaced by lake homes.”
In response, Emery helped form a Cass County tourism preservation group, which worked to change ordinances that hamstrung resort owners wanting to stay in business.
An outgrowth of that process was the Emerys’ decision to sell Big Rock not to a developer or other individual buyer, but to a group of buyers, each of whom would own one or more cabins. (An adjoining mobile home park also is part of the resort, with private owners.)
The commercial common interest community that evolved works like this:
• Individual cabin owners are assessed a maintenance and operation fee that pays for needed cabin repairs and other upkeep, as well as the hired staff and in-common costs such as harbor dredging and dock repairs.
• Cabin owners can stay in their own cabins at a cost of 10 percent of the cabin’s rental rate. But owners don’t share in the resort’s other rental income during that time. “This is a resort, and we’re maintaining it as a resort, so cabins have to be available,” Emery said.
• A formula determines the percentage of the resort belonging to individual cabin owners, and year-end profits are paid accordingly. People who own multiple cabins (the Emerys still own five) gain a greater share.
• Common operating expenses are reduced by boat rentals, souvenir and gas sales, and other services sold to guests.
“In 2006, the economy was not in good shape,” Emery said. “But we sold most of the cabins we wanted to sell in the first two years — many to people who had been coming here for many years. Things were tight at first. But in the third year, people started seeing a profit.”
Last weekend, the opening of the state’s fishing season, 17 of Big Rock’s 20 cabins were full, each with anglers eager to catch a meal or two of the fish Leech Lake is famous for — walleyes.
In a few weeks, when schools close, more families will head north. It’s then that the resort’s swimming pool will be abuzz with kids of all ages, many of whom will beat a path to the lodge for an oversized Big Rock ice cream cone.
By evening, when boats full of anglers return to the sanctuary of the resort’s harbor, action will shift to the fish-cleaning screen house, and soon the sweet aroma of dinner on a grill will waft through tall pines.
“We set up the bylaws so the only way Big Rock can be discontinued as a resort is if 80 percent of owners approve it,” Emery said. “I don’t think that will ever happen.’’