Pan and Fork owner optimistic about project
A nonprofit organization that owns 2.4 acres of prime ground in Basalt says it is optimistic that it can develop the site despite potential problems with its current partner.
Roaring Fork Community Development Corp. President Michael McVoy said he isn’t ready to abandon Realty Capital Management despite a town of Basalt report showing that one of the principals in the firm, Richard Myers, is facing foreclosures and lost a $5 million civil fraud case for recent development woes.
“Since 2008, a lot of developers have a black mark on their development history,” McVoy said.
He said Myers and Realty Capital Management have the expertise that the nonprofit needs to redevelop the Pan and Fork Mobile Home Park. The Roaring Fork Community Development Corp. bought the 5.3-acre mobile home park in August 2011 for $3.25 million and then immediately sold 2.9 acres to the town of Basalt for $1.2 million. The town will turn its portion of the property into a park alongside the Roaring Fork River. The development corporation has applied to build a hotel, commercial space and residences on its part of the property. The nonprofit organization signed a contract about a year ago to pursue a plan with Realty Capital Management. Both sides have to meet certain threshold issues at certain times for the partnership to advance, McVoy said. The nonprofit’s major responsibility is earning the zoning and development approvals from the town. The developer’s major responsibility is proving that it can raise the capital to build the project.
McVoy likened the relationship to a “dating” couple — they aren’t engaged, and they certainly aren’t wed yet, he said.
The town government’s assistance also is needed to make the project work. The town is pursuing $7.5 million in improvements, mostly to make alterations to the river so that the development site isn’t in the flood plain. As part of its review of the project and its interest in getting involved, the town hired a financial consultant to do a business background check on Realty Capital Management. Ehlers Inc., the consultant with expertise in public finance, reported to the Town Council on Tuesday that it found “two fundamental concerns about the developer’s financial and organizational capacity to partner effectively with the town to complete the project as proposed.” One of the concerns was Myers’ recent legal and financial difficulties.
McVoy downplayed the significance of the findings.
“There was nothing in that report that we weren’t aware of,” he said. McVoy later added that he doesn’t believe this is the “proverbial smoking-gun situation.”
“It’s not an uh-oh situation,” he said.
Besides, if it turns out Myers and his firm doesn’t have the capacity to develop the project, Community Development Corp. can exit the contract and explore relations with a different partner, according to McVoy.
“We are protected,” he said.
Myers told town officials Wednesday that he relinquished a lead role in the development effort to Presidio Companies, a San Francisco-area development firm that specializes in hotel development. The company owns a 70 percent interest in a proposed Hyatt Place hotel envisioned for the Pan and Fork site. Realty Capital Management would have a 30 percent interest in the hotel, according to Myers.
Basalt Mayor Jacque Whitsitt said earlier this week that the findings in the report don’t necessarily doom the project.
“It doesn’t look rosy for that particular developer,” she said.
Town Manager Mike Scanlon said the town’s consultant would do a business background check on Presidio Companies and continue the review of the project.
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