We study the reconstruction of smooth surfaces from point clouds. We use a new squared distance error term in optimization to fit a subdivision surface to a set of unorganized points, which defines a closed target surface of arbitrary topology. The resulting method is based on the framework of squared distance minimization (SDM) proposed by Pottmann et al. Specifically, with an initial subdivision surface having a coarse control mesh as input, we adjust the control points by optimizing an objective function through iterative minimization of a quadratic approximant of the squared distance function of the target shape. Our experiments show that the new method (SDM) converges much faster than the commonly used optimization method using the point distance error function, which is known to have only linear convergence. This observation is further supported by our recent result that SDM can be derived from the Newton method with necessary modifications to make the Hessian positive definite and the fact that the Newton method has quadratic convergence.