The board of the historic Commerce Club appears ready to merge with another downtown business club — the One Ninety One Club.
“We are moving forward,” said David Ratcliffe, chairman of the Commerce Club board and CEO of the Southern Co. “We reviewed a term sheet, which includes most of the details of the deal. Now we have to translate the term sheet to a written contract. And we will vote up or down next month.”
The Commerce Club and the One Ninety One Club have been exploring a possible merger since last May. The merged club would be called the Commerce Club, but it would be located in the One Ninety One Peachtree Tower rather than its current location near Five Points.
The new club, however, would be located on the top two floors of the office building in what used to be the offices of King & Spalding. The owner of the One Ninety One Club, ClubCorp of America based in Dallas, would become the general manager of the merged entity.
“We started down this road knowing that combining the memberships would have a lot of financial advantages,” Ratcliffe said. “We have seen a deterioration in our memberships early this year because of the economy. “
Under the proposed agreement, ClubCorp would own the lease for the new space at the One Ninety One Peachtree Tower rather than the Commerce Club. Cousins Properties owns the building, and several of Cousins’ executives have leadership positions in both clubs.
Commerce Club leaders said they would continue to have an Atlanta-centric senior board and operating board, ensuring that the entity would continue to perform its civic role.
Historically, the Commerce Club has played a significant part in bringing together the business community to address issues in the city and state.
“We have tried to contemplate various scenarios that would make us want to disolve the relationship with ClubCorp, and we believe we have adequately provided for those scenarios,” Ratcliffe said of the arrangement.
It is expected that it would cost about $7.5 million to refurbish the space. Cousins, the Commerce Club and ClubCorp. would split those costs three ways. The build out is expected to take 18 months, which means the new club likely would open in the last quarter of 2011.
“We believe the fundamental proposition is sound,” Ratcliffe said. “The board that was in attendance today was favorable to moving forward.”
The Commerce Club has considered moving several times in the last 10 to 15 years as the business center of Atlanta moved north from Five Points. But none of the possible relocation proposals has ever been this far along.