| Description of Prop: |
Old Hemsley hotel, bad condition, historical. Developer states construction financing not available for hotel since 9/11/01. Land value approx. $1,600,000. 150 Unit Hotel Project - San Antonio, Texas
10/14/02 The partnership and borrower are working together to find an alternative use for the property. The borrower has agreed to keep the property taxes current. The borrower is a single asset entity with no personal guarantee. The adjacent property (which was another L&W loan called Seven Oaks) was recently purchased for a commercial shopping center. Our hope is to work with the borrower with the belief that the land will increase in value based on neighboring land development.
12/2/02 This property and collateral consists of approximately 10 acre tract of land in San Antonio. The land is on Austin Highway, a good location, and has an abandoned hotel that was once owned and operated by the Helmsley family out of New York. The developers, Mikob Properties have a $5,000,000 non-recourse loan and have defaulted on the loan. The property next door, another L&W partnership has been sold to Wal Mart and is presently under development. We have an agreement with Mikob for them to maintain the taxes and the insurance on the property. Today the land is worth about $2,000,000. We have had several developers look at the property. They all agree that the land should improved in value significantly once Wal Mart has finished construction next door. We believe that it is in our best interest to hold this property for another year and try to get a greater value out of the land.
9/22/03 Foreclosure Posted for 10/7/03
1/18/04 The property was foreclosed on December 2, 2003. The
partnership is evaluating the value of the property at this
time, and is considering the possibility of a joint-venture
with a developer to build a shopping center. Walmart has completed
a store in the last few months located directly next door. The
area is rapidly growing.
3/6/04 The City of San Antonio reported that a fire occurred
at the abandon hotel. A few days prior, the city required the
partnership to erect a fence. Vagrants were trespassing on the
property. The damage caused by the fire was extensive to a center
building. No injuries were reported. The partnership is currently
attempting to contract with a firm to demolish the entire project.
The cost is estimated at $300,000.
9/5/04 The partnership has borrowed $400,000 in order to pay
for the fire cleanup and taxes. The renovation has been completed
and the hotel is gone. The land is now clear so that a new developer
could purchase the property to build. Next door there is a new
Walmart, and across the street is a new HEB Food Store.
1/15/05 The partnership has the property listed, and believes that the property may net $2,000,000 after expenses.
6/9/05 The partnership has received a proposal from Brian Atlas to purchase the property for the full asking price of $2.5MM. The board of manager of Washington Advisors has approved the sale and has brought the issue to a vote of the Limited Partners. Atlas has acquired the property next door which will greatly increase the probability of a commercial shopping center being able to be constructed because it increases the road accessibility and provides enough land to have a good size shopping center.
12/31/05 The partnership has a current sale pending with Brian Atlas, which he has an option to purchase the property. Atlas is attempting to put together a shopping center deal.
7/18/06 The partnership is still optimistic about closing the deal for the purpose of a shopping center. The buyer has an option which lasts through the end of the year (2006).
The partnership and the proposed buyer have been working on a curb-cut for an entrance to the property. The property otherwise is land-locked to any large amount of traffic that would support a shopping center. This could delay the sale of the property until this issue is settled either with the City of San Antonio and/or Walmart which is the neighboring property.
8/2/07 The property has been under contract for since 12/31/05. The buyer has indicated that he intends to close by September 30, 2007. The partnership has a $400,000 loan, plus accrued interest, which paid the cost of demolition of the building and taxes. The amount of the sale is $2,500,000, less an anticipated $445,000 in expenses, to date. The return of principal is estimated at 40%.
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