|By Kathy A. Goolsby, The Dallas Morning
NewsMcClatchy-Tribune Regional News
Oct. 8, 2007 - A proposed $358 million lakeside resort on Joe Pool Lake is back on the horizon, despite more than a decade of false starts and legal troubles for its most recent developer.
New investors recently filed a $4.4 million bid to buy plans and agreements for the project. Marcus Hotel Group in Milwaukee and Illinois-based KB Partners put in a bid as KB/Marcus Texas LLC to take over for developer Raymond Goad, who filed for bankruptcy in November.
City officials said they're hopeful the new investors finally will bring the resort to fruition.
"I do feel good about this one," Grand Prairie Mayor Charles England said of KB/Marcus Texas. "We've done a lot of research on them, and I think they've got the resources to get the finances for this."
Mr. Goad took on the project in 2002 under the name Wildflower Resort Co. and had been subleasing the property from the city of Grand Prairie. But Wildflower was continually late with its twice-annual lease payments. The city threatened to terminate its agreement with Mr. Goad's company at least three times. Then he filed for bankruptcy protection.
Mr. Goad could not be reached for comment. But the bankruptcy filing is not his only legal trouble.
Search warrant affidavits filed in March in U.S. District Courts in Seattle and Dallas reveal that Mr. Goad, his business partner Joseph Lavin and others are under investigation for suspected mail fraud, wire fraud, money laundering, conspiracy and income tax evasion.
According to the affidavit, FBI agents found that money received by Mr. Lavin's company from investors for a foreign currency trading scheme instead was used by Mr. Goad and Mr. Lavin. They are believed to have used the money for personal expenses and payments to family members and to the Wildflower Resort Co.
Mr. Lavin and his company, Global Asset Partners LLC, also are being sued by the Securities and Exchange Commission, which alleges they defrauded more than 100 investors out of more than $5 million. The lawsuit, filed in U.S. District Court in August, says that at least $1.8 million of that was wired to Wildflower Resort from January 2003 to November 2006, allegedly to pay start-up expenses.
Mr. Lavin, most recently from the Seattle area, could not be reached for comment.
Grand Prairie City Attorney Don Postell said the legal cases involving Mr. Goad and Mr. Lavin will not affect future development on the east side of the lake's peninsula.
"That's one of the advantages of this going back into bankruptcy," Mr. Postell said. "When it comes out of bankruptcy, it will come out clean and with no claims against it."
David Merritt, senior vice president of development for Marcus Hotels, confirmed that his company bid on the project but declined further comment, referring instead to the company's Web site.
According to the site, Marcus Hotels and Resorts owns 15 hotels in nine states, including the Hilton Garden Inn Houston Northwest, eight restaurants and three resorts. Two of the resorts are in Lake Geneva, Wis., and the third is in Scottsdale, Ariz.
"The big difference between them and Mr. Goad is they have resorts on the ground," Mr. Postell said.
Mr. Postell said KB/Marcus officials have indicated they plan to build a complex similar to what Wildflower proposed for the site, which is owned by the U.S. Army Corps of Engineers and leased to the city. Those plans call for a 500-room luxury hotel, a 75,000-square-foot conference center, spa and fitness center, and a 36-hole Jack Nicklaus Signature Golf Course.
"A shopping area is still in the works, but they're trying to decide what the mix of stores is that they can put out there," Mr. Postell said. "The corps is pretty limiting on what they want down there. They don't want a huge amount of retail."
Mr. Postell said the KB/Marcus deal is likely to close by year's end, but he does not know when the resort would open. The KB/Marcus bid is tentative and thus far the only one on the table, Mr. Postell said.
"Unless someone else comes in and offers at least $100,000 more than ... [the KB/Marcus bid], they'll be declared the winner," he said.
The deadline for bids is Nov. 15. The city has had other inquiries about the property, but Mr. Postell said Thursday that no other bids have been filed.
Mr. England said he and other officials have waited a long time for something to happen on the peninsula. He's hoping this time they won't be disappointed.
"This group has the ability to build a first-class resort and to get it done," Mr. England said. "We'll just keep our fingers crossed, but I think it's finally going to happen."
Mr. Goad was the third developer to take on the project. Over the years, his company paid the city several million dollars in lease payments, Mr. Postell said. Another $1 million in missed lease payments is still unpaid, he said.
List of creditors
According to bankruptcy documents, Wildflower Resort Co. owes more than $17 million to more than 30 creditors, including $3.5 million to Turner Construction in Dallas and $542,000 to Nicklaus Design for the golf course design and consulting fees.
"The only asset the estate has is the lease," Mr. Postell said. "There are some plans and stuff drawn up by the architects, but they and the construction company have money owed to them by Wildflower, so there are no other free and clear assets."
Earlier this year, a Chicago company sued Mr. Goad, claiming he defaulted on loans made to Wildflower Resort Co. in November 2005. According to court documents, Mr. Goad owed JMFunding Inc. $5.5 million, including penalties.
A Seattle home owned by Mr. Goad was foreclosed on in March after he missed six payments totaling more than $35,000. He also testified in a Florida court in June that his Dallas apartment had been seized by the courts, leaving him homeless.
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