Harbor Club Is Booming -- Private Facility Drawing Younger, Less Traditional Eastside Business Clientele

BELLEVUE

Where do the elite gather on the Eastside?

Last year, business people who wanted the privacy of a members-only club met at the Bellevue Club south of downtown Bellevue. Many still do.

Now there's an alternative: the Harbor Club Bellevue, overlooking Downtown Park and Interstate 405 from the 25th floor of the Rainier Plaza Building in downtown Bellevue.

If the location sounds familiar, that's because it's the same place the Lakes Club operated from 1988 to 1996, when declining business forced the club to close.

To the casual observer, it might seem a cinch to make money off an exclusive club catering to well-heeled corporate executives and professionals. However, the failure of the Lakes Club at a time when Eastside business was booming serves as a reminder that the business of operating a city club is as risky as any other business.

Because federal law doesn't allow tax deductions for club memberships and because corporations have tightened their belts, city clubs generally have been hard-pressed to maintain their membership.

But after one year of business in Bellevue, the Seattle-based Harbor Club is attracting a younger, less-traditional business clientele that is representative of the Eastside's changing business community. Combined, the two Harbor Clubs boosted their membership from 620 to 1,402 between August 1996 and September 1997, making them two of the fastest-growing such clubs in the nation. Five

hundred memberships are Bellevue-based.

Although there are still fewer members than during the Lakes Club's peak, the dining room in Bellevue is busier than ever, said Wayne DeMeester, an Everen Securities senior vice president who has been a member of both clubs and who is now president of the Harbor Club Bellevue.

During lunchtime one day last week, most of the tables in the main dining room were occupied by business-suited men and women in their 30s and 40s. Others were enjoying a $4.95 buffet, and two business luncheons were taking place in private rooms.

"It's been phenomenally successful," said DeMeester. "This is a litle different than the Lakes Club. It's informal, you don't have to be as dressed up. It's not pricey. There's fine food. They've found the formula."

The situation didn't look promising last year, when the Harbor Club accepted Rainier Plaza owner Wright Runstad's request that it start a second, Eastside club in the space vacated by the Lakes Club.

The club space was closed for months, and many Lakes Club members accepted an invitation from the former operator, Club Corporation of America, to transfer their memberships to Club's Columbia Tower Club in Seattle.

The Harbor Club had suffered a near-disastrous loss of market share after the more opulent Tower Club opened in 1986. But under the leadership of its new chief operating officer, Tom Goodenow, the older club slowly rebuilt its membership and its financial stability.

Goodenow helped the not-for-profit business recover by holding the line on initiation fees and dues, improving the cuisine and expanding and remodeling the Harbor Club Seattle's quarters atop the downtown Norton Building.

When Goodenow opened a second Harbor Club in Bellevue, he upgraded the kitchen, enlarged the main dining room, replaced dark wood with glass in the gloomy entryway, reconfigured the meeting rooms, and hired the Olympic Four Seasons' Bryan Vietmeier as chef.

The Bellevue club, reflecting the more casual Eastside business ethic, doesn't require male members and guests to wear coat and tie. (The Seattle club still does.)

Perhaps most critical to the Harbor Club's success, it has offered steep discounts to corporations that take out multiple memberships.

If three or more employees of a company join the Harbor Club, initiation fees drop from $1,200 to $500 and monthly dues drop from $85 to $55. And, with more people doing business on both sides of Lake Washington, the two-location club gives members more flexibility for dining with colleagues and clients.

It all boils down to one question, Goodenow says: "What are you getting for that dollar?"

After one year on the Eastside, the club has paid off its debts and set aside cash reserves to make improvements.

The Harbor Club has no plans to operate its own athletic facilities. But Goodenow says the club's next big deal for members will involve a partnership to provide athletic services.

Keith Ervin's phone message number is 206-515-5632. His e-mail address is: kerv-new@seatimes.com