January 9, 2008 - 10:00 pm
The Atalon Group has acquired the assets of 3,592-acre Lake Las Vegas for an undisclosed amount after the developer defaulted on a nearly $540 million loan last fall.
The move pushes out Transcontinental Corp. and its chairman and president, Ron Boeddeker, who had been directing the development project since 1990.
The transaction gives Atalon an interest in the Ritz-Carlton Hotel, nearly 400 acres of undeveloped land, a handful of businesses on the Strip and three golf courses, with a fourth in development.
The Loews Las Vegas Resort, MonteLago Village Resort and MonteLago Casino are not affected by the transaction.
Transcontinental’s default occurred after builders planning to develop the 400 acres failed to make option payments in September because of the downturn in the housing market.
Atalon Chief Executive Officer Frederick Chin took over as president of the Lake Las Vegas operating companies Jan. 2, the company announced Tuesday.
Chin and his business partner, James Coyne, have been consulting on the management of Lake Las Vegas for an investment consortium led by Credit Suisse since Transcontinental defaulted on the loans.
Atalon is described as “a national operational restructuring firm that has experience in turning around financially troubled companies,” in a statement announcing the change.
Chin said in the statement that the new ownership is committed to “a disciplined approach to business planning, budgets and controls.” The release said a “number of key staff members will stay on.”
However, someone familiar with the operations said some senior management people in the development and marketing teams have already been laid off.
It is also not known if other members of the Boeddeker family, who held various positions at Lake Las Vegas, have been let go.
Attempts to reach Chin and the Boeddeker family Tuesday failed. A call to Lake Las Vegas was not returned by press time.
Transcontinental began selling residential real estate at Lake Las Vegas Resort in 1993. The company started out selling only custom-home lots in the community’s SouthShore section, but the developer made the move to semi- custom and regular development around 2000.
John Restrepo, principal of the Las Vegas real estate consulting firm Restrepo Consulting Group, said Lake Las Vegas is going to face the same challenges all residential developments will for the next couple years while the housing market corrects itself.
“It is still a little isolated from the core of the valley, so it is still hard for people to live there who work here along the Strip, for example,” Restrepo said.
Lake Las Vegas was conceived about 40 years ago by actor and sometime hotel owner J. Carlton Adair, who originally bought the land and water rights to develop what he dubbed Lake Adair.
But Adair declared bankruptcy and another developer failed to complete the project before Santa Barbara, Calif.-based Transcontinental Properties bought it in 1990.
Contact reporter Arnold M. Knightly at firstname.lastname@example.org or (702) 477-3893.