Lane wants to stay involved with bankrupt S. Tahoe project
By Kathryn Reed
Randy Lane is not giving up on being an integral part of whatever the rebar and concrete near the state line in South Lake Tahoe eventually becomes.
His firm, Lake Tahoe Development Company, this month asked the bankruptcy judge in Sacramento for more time to come up with a plan. South Lake Tahoe and the creditors have until Aug. 16 to file with the court their views on Lane’s plan.
City Attorney Patrick Enright told Lake Tahoe News the city has no desire to allow Lane more time to figure out what to do with the 11 acres.
Debris covers parts of the rebar-concrete bankrupt construction site in South Lake Tahoe. Photo/Kathryn Reed
“It’s the same thing he has been saying for the last two years,” Enright said.
That site was supposed to be a $400 million convention center, with two boutique hotels, retail and open space.
The idea is it would have complemented the Heavenly Village development on the other side of Highway 50.
Without all the parties foreclosing, Lane still has ownership of nine of the 29 parcels. Owens Financial is owed the most – about $25 million.
Lane admits something different than originally planned is what the market now dictates.
“The units will be smaller so you can be more competitive from a pricing standpoint. The market doesn’t want $2 million units,” Lane said.
Several entities have looked at the project, though all turned out to be false starts. Since the foreclosures started Vail Resorts has revisited the possibility of having a roll in the project. Initially the Colorado company was the hotelier. Vail backed out long before LTDC filed for bankruptcy.
Heavenly Mountain Resort is Vail’s only ski resort without a high-end hotel nearby.
JMA Ventures out of San Francisco, which owns Alpine and Homewood ski resorts, also studied the possibility of taking over the project.
“Every week there seems to be more interest than the previous week,” Lane told Lake Tahoe News. “The solution is not filling in the hole and starting over again.”
For now, though, there is no serious investor.
City officials allowed construction to start without the Zephyr Cove developer having financing definitively in place. Lane was also allowed to go forward without a consolidated map being filed. That is why the bankruptcy process that started in October 2009 and subsequent foreclosures in December 2010 are convoluted.
The site continues to look more rundown by the day, with graffiti on fences, no passable sidewalks for pedestrians and debris inside the compound.
Lane would like to change some of that by October.
“I want to clean the place up, maybe fix the sidewalks,” Lane said.
Asked who would pay for that, Lane said, “Us, and a couple of the creditors and maybe the city.”
It’s possible at the early September court hearing the judge will put an end to Lane’s continuous pleas for more time. The judge could dismiss the case, which means the bankruptcy goes away. This could create a mess with property owners
The judge could also turn it into a Chapter 7 bankruptcy. This would mean liquidating the assets.
It’s now over five years since the $400-plus-million convention center-retail-hotel complex that broke ground in 2006 has become a crumbling pile of concrete and rust. Not only has the current City Council failed to address this problem, it appointed the guy responsible for this crater as our new mayor.
The real reason that this huge crater can’t be fixed, is because the City never required a performance bond. In fact, then Mayor Hal Cole, who also served as the Redevelopment Agency board chairman, not only let the developer off the hook for the performance bond, Mr. Cole signed the contract first, even though the contract specified the developer must sign first. Why Mr. Cole suspended the performance bond and signed first remains a mystery and is a matter that should still be investigated by the Grand Jury.
Worst of all, on July 10, 2006, Mayor Hal Cole told the public, “The developer is assuming all the risk.”
Given that the City ended up with an enormous crater and no funds to fix it, Mayor Cole’s comment was not only false and deceptive, his re-appointment as mayor has created an unacceptable level of mistrust in our City Council.
Lane admits something different than originally planned is what the market now dictates. Great plans never change over time Mr. Lane. Hang up your development stockings and find another career path.
NonononononononoNO! What does this guy not get? Most of us think he belongs in jail, not involved in a project tthat HE was instrumental in bankrupting. If I were him I would leave town in shame!
The City can’t do anything about it until the bankruptcy court makes their decision. The court needs to make this decision when originally scheduled and not listen to Lane’s request for more time. Enough is enough! He had his time and blew it and we’re suffering from it.
It sounds like Enright will represent our needs in court, and I had always hoped we be rid of Lane, but if he still has 9 of the 29 parcels so that won’t be the case.
I also hope the city doesn’t allow Lane to start any of his other projects because we don’t want to be in this position again…the lot behind Stateline Raleys and the property at Timber Cove Lodge. (am sure there are more but I don’t know) Timeshares aren’t the way anymore since we have so many spots already.
So should the Mayor leave Town, He has been messing up this City for too long. When are you people going to wake up ?
Get rid of Hal Cole and Tom Davis and the Good Old Boy System
Randy sold Owens 13 units and also took out an extra loan with them. The 13 units were collateral and loaned upon full face value which is about zero right now. Owens filed for a NOD on June 16, 2009 DOC # 2009-0029115-00. As of June 15, 2009 the amount was $25,890,113.20 and will increase until the account is current. To actually find out the exact amount you would have to contact
Owens Mortgage Investment Fund, A Ca Limited Partnership
c/o OWENS FINANCIAL GROUP INC.
2221 Olympic Blvd., Walnut Creek, Ca 94595 (925)935-3840
Chiming in…the credit collapse worldwide left many “holes in the ground” in almost every town and city in the country. We are not alone and if the unforeseen crisis had not happened the project would have been built. It is a fantastic piece of Lake Tahoe and a visionary group will finish it. Blaming Lane, Cole and the rest is negative energy…let’s find the right group to move forward. IMO this is where the City should be putting their energy because every day it is not finished is lost future revenue.
Before anyone thinks I know it all I actually have the documents from the NOD’s and the orignal liens filed from the SMC Contracting and TW/RTC, a joint venture inc. for about $3 million. That lien is why the project was actually stopped in the first place causing Randy to take out a loan from owens for $22 mil. He paid the liens off , started the project back up and then defaulted but what happened to the other $19 Million is anybodys guess.
Ski Bum that is great info but again the bottom line is getting the project re-started with a viable investment group who will see great value in “The Hole”. And there is value.
Let’s face it, Randy Lane is (or was) a developer and capitalist. He really had no obligation to look out for the city or the people of South Lake Tahoe’s best interest.
The real story here is that Hal Cole blew a hole in this thing. Without the performance bond, he was delinquent in his duties and obligations to the citizens and the city. Uhhh, that was his JOB, and that kind of performance in the private sector would have him fired for gross negligence immediately.
Cal Hole, now the mayor?!! and noone holding his feet to the fire on this!!? He needs to be shown the door. His continuing presence is now an indictment on the electorate and the council.
Further, ask any of the folks over at El Dorado Dept of Transportation about Hal Cole’s participation in the Sawmill Bike Path planning. Next time you drive by the bridge at Elk’s Club and look at the bike bridge you can thank Hal for that too. He was the owner of that white house on stilts next to the bridge. Regardless of public good, he refused to let the planners place the path and bridge in the place it was meant to be, away from the highway and past his property. Next thing we know, the bridge is up along Hwy 50, and gee, the Conservancy then is forced to buy his vacation rental house and tear it down. All this simply to solve the pathway engineering roadblock that Hal created on a piece of property he never even lived in. And Hal’s the mayor…..
Gotta disagree with Duck. By the time Lane started building us a “convention center” with fractional ownership hotel attached, there was already lots of evidence and many magazine articles about how convention centers in many cities were turning out to be money losers and drags on local government economies. I’m still not sure how investment groups continue to sucker tax payers into building new stadiums for their sports teams when it’s pretty much proven to be another pit every time.
I’m with dogwoman. It was very well publicized that these types of ventures in other cities were failing.
Tahoeduck- For you to say that we should stop blaming the people who caused this mess is flat out wrong. These same people are still trying to run the show even after their huge failures. To really move forward we must look at what went wrong, including the people involved, and change course, including getting these people out of office.
Only in Lane’s fantasy mind is there “more interest” week to week. He’s not talking to real locals if that’s his true belief.
Blame the people who caused this mess, hold them responsible and punish them.
Why on earth would you stop holding the greedy lawbreakers who got this mess started accountable? Look forward yes, but don’t forget why and how this happened. If we don’t get rid of these crooks that run our fair town they will do this again and again
Kubby, is it possible that the “Little Miller Act” is involved in Coles mess ???