The Club at the Heart of Palmas del Mar Has a New Rulebook, and Its Lender Helped Write It

On October 9, 2026, Judge María de los Ángeles González confirmed Palmas Athletic Club's Chapter 11 reorganization plan. The nonprofit runs the two 18-hole golf courses, the tennis facilities and the beach club inside Palmas del Mar, and it will keep operating under its existing management while it repays creditors, News is my Business reported. For anyone pricing a home in the community this fall, the confirmation order sets terms that will shape the club for up to ten years. Those terms decide who gets the club's spare cash first, how far dues can rise before a creditor takes a cut, and what happens if any part of the club is ever sold.

The golf, the tennis and the beach club are a large part of what sets Palmas del Mar apart from Dorado, Bahía Beach or Rio Mar. Under this plan, a lender has a financial stake in how those amenities are run.

What the Court Approved

The club filed for bankruptcy on August 4, 2025. It reported about $16.8 million in assets and $36.5 million in liabilities, according to News is my Business's filing coverage. UBS Trust Co. of Puerto Rico, which represents the bondholders, then filed a $46.4 million claim. The debt traces back to a mortgage deed signed on October 22, 2010, according to the court's April 2026 order.

The confirmed plan settles that claim at $14 million in principal, structured this way:

1. A $3.5 million payment on or before the plan's effective date.
2. A secured promissory note for the remaining $10.5 million, calculated on a 20-year amortization schedule but due in full on the 10th anniversary of the effective date.
3. Annual interest that starts at 8% and rises to 8.25% in year two, 8.75% in years three and four, 9.25% in years five and six, and 10.25% from year seven until the note comes due.
4. A requirement to put 70% of annual excess cash flow toward extra principal payments.
5. Extra payments to bondholders for two years after the note is repaid, under specified conditions.

The $14 million figure is about $32.4 million below the bond claim. That gap is not what the club ends up saving, because interest and the contingent payments still apply. The court found the plan financially feasible and unlikely to lead to another liquidation or reorganization.

Where the Club's Extra Dollar Goes

Point four on that list matters most to anyone who plans to use the club. The agreement calculates excess cash flow after specified deductions, including required payments, approved capital expenditures and a minimum cash reserve. Seventy percent of what remains goes to principal.

So approved capital projects still get funded first. Once they are paid for and the reserve is set aside, most of each good year's surplus goes to the lender. The rising interest rate points the same way. Each year the balance stays outstanding costs more than the year before, which gives the club every reason to pay principal down early. The ten-year deadline adds pressure, since a note amortized over 20 years but due in ten will have a large balance left when it matures.

The plan does not set any spending decisions. It does set the priorities that the club's management and board will work within for most of the next decade.

The $750 Threshold and the Value of Selling

Three contingent provisions give bondholders a share of the club's future upside. According to News is my Business, bondholders may receive:

• 25% of net proceeds above $20 million from a sale of all or substantially all of the club's facilities
• 25% of gross proceeds from partial facility sales
• 25% of revenue generated by monthly membership dues above $750 per member

The dues provision sets a soft ceiling. On any dues above $750 a month, a quarter of the revenue goes to bondholders, which makes raising dues past that line less rewarding for the club. The club's own website lists Full Membership at $385.99 plus tax for all ages and a corporate rate of $346.06 plus tax. The page does not say whether those amounts are billed monthly. If the listed rate is monthly, it is roughly half of the threshold where bondholders begin to share.

The sale provisions work more strongly. A partial sale, such as a parcel or a single facility, would send a quarter of the gross proceeds to bondholders before any costs are deducted. A sale of the whole club shares only the amount above $20 million. These provisions make selling off pieces of the club costly for as long as they apply.

Liens and security interests also stay in place until the bond trustee's release conditions are met: full payment, compliance with the agreement, and the end of the additional-payment period with nothing outstanding. The court keeps jurisdiction over implementation and enforcement.

Two Organizations, Two Separate Bills

Buyers often assume that a home in a resort community comes with its amenities. In Palmas del Mar, the costs are split between two separate organizations.

The PHA's new-homeowner page says property owners become members of the association and lists the annual assessments. The club's original membership plan said its goal was for all Palmas del Mar property owners to become members, and that every owner "shall have the right" to join. That document dates from the club's launch around 2010 and does not describe current membership terms. Whether a particular property carries any club obligation is something to confirm with the club and in the seller's documents before closing.

Where the Two Organizations Met in Court

The two organizations ended up on opposite sides of the bankruptcy. In September 2025, the PHA filed a claim for 2024 and 2025 assessments that the club owed. The claim was originally $152,230 and was later reduced to about $128,735. The club objected, citing a memorandum of understanding between the two in which each provided services to the other. The club argued those services offset any dues it owed and calculated that the PHA owed the club $446,365.45. The PHA responded that the memorandum had ended in 2024 and that, under its own accounting, the club owed between $102,393.30 and $326,184.20.

The confirmation order includes a previously approved settlement that resolved the dispute. The plan lists the PHA's claim at $126,730, in the creditor class that receives 10% of allowed claims through 60 equal monthly payments without interest. For a buyer, the dispute is mainly a sign that the two organizations had a shared services arrangement and that their finances overlap. Questions about how services are split now are best answered by the PHA and the club directly.

What Hasn't Changed

Club life continues. The PHA calendar lists the Wyndham in Pink season finale on October 24 and a Christmas party and golf-cart parade on December 19. The club remains a nonprofit, and President José R. Vizcarrondo-Carrión leads the management team that continues to run it.

A Few Questions Buyers Are Asking

Does buying a home in Palmas del Mar mean joining the Athletic Club? The club's founding plan, from around 2010, describes membership as a right that property owners have. PHA membership is a separate matter that the association's own page ties to ownership, with its own assessments. Current club terms for a particular property are best confirmed with the club and in the seller's documents.

Is the club's debt now paid off? No. Confirmation approved the plan. Repayment runs through the note, and the liens stay in place until the release conditions are met.

Could membership dues rise? The plan does not set dues. It sends a quarter of any revenue from monthly dues above $750 per member to bondholders, which makes increases past that level less rewarding for the club.

When is the note due? Ten years after the plan's effective date. Public reporting has not yet given that date.

This article is general information about a public court plan and published fees. It is not legal, tax or financial advice, so please confirm how any of it applies to your situation with an attorney, accountant or other qualified professional.

If Palmas del Mar is on your short list, the club's next ten years belong in the same conversation as the home itself. Guanina Cintron at Wow Real Estate Puerto Rico can go through the club structure, the PHA assessments and a seller's documents with you before you commit. Begin a Private Conversation.