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Dallas Businessman, Kelcy Warren, Acquires the Bankrupt Lajitas Resort on the Rio Grande
 for $13.5 million; Previous Owner Spent  $100 million to Create Exclusive Golf Resort, Retreat

By Paul Meyer, The Dallas Morning NewsMcClatchy-Tribune Regional News

Dec. 22, 2007 - LAJITAS, Texas -- Not even $100 million, beer-guzzling goats and the legend of Pancho Villa could lure the travelers to these 25,000 acres of Chihuahuan desert on the fringes of civilization.

Dallas businessman Kelcy Warren believes he can.

On Friday, Mr. Warren sealed a $13.5 million deal to buy the bankrupt resort and give Lajitas another life.

"I still think it could be something special," the 52-year-old said Thursday aboard his private jet, flying over the desert and Davis Mountains to a 7,500-foot landing strip surrounded by scrub brush and ocotillo plants.

"It's a treasure."

On the banks of the Rio Grande between Big Bend national and state parks, Lajitas has long been one of the stranger outposts of the world. It has been called America's weirdest golf resort, a spiritual retreat, an offense to the desert and a leading hotel of the world.

Its previous owner, Austin multimillionaire Steve Smith, lavished $100 million to turn the property into an exclusive refuge for the rich, with an 18-hole bentgrass golf course, upscale restaurants, old-world bar, 92 luxury rooms and Mayor Clay Henry, a beer-drinking goat.

But the desert has always had a way of withering material ambition. Earlier this year, Mr. Smith's dream officially ended in bankruptcy. Only a few home sites ever sold. The resort couldn't turn a profit. And a federal judge approved the sale of Lajitas earlier this month to Mr. Warren, co-founder, chairman and CEO of Dallas-based natural gas transportation company Energy Transfer Partners.

Mr. Warren, a Levis-jeans-and-cowboy-boot-wearing Texan from White Oak who also has a record label, has owned a home in Lajitas since 2003 and hopes to remove the exclusivity from the resort. He says he wants to put it more in touch with surrounding Brewster County, with just about 9,000 residents and a per capita income of about $15,000. It's a place where many have long come to get away from material excess in the spare beauty of borderlands.

"I want to walk into the bar and hear laughter and just see people," Mr. Warren said from town, joined on the trip by business associates and friends who include former Dallas Cowboys Charlie Waters and Mike Montgomery.

"This thing is so beautiful, and there's nobody here."

Chicken fried steak

Unlike Mr. Smith, whose persona became intertwined with his property, Mr. Warren plans a largely hands-off approach. He has contracted with Edwin Leslie, president and CEO of Houston-based Bridlie Hospitality, to operate the resort. Mr. Leslie on Friday slashed prices on the hotel rooms and began charging $29 a night at the RV park, where he says it used to take a $100,000 membership to stay. A new chef has been hired to bring the restaurant things like chicken fried steak instead of $50 steaks.

"It's the exclusivity. I think that's the biggest thing that's been a thorn in the side of the community," Mr. Leslie said.

The vision for a resort at Lajitas began in the late 1970s, when Houston real estate developer Walter Mischer Sr. first conceived a Wild West-style complex in the area where Gen. John "Black Jack" Pershing once pursued Mexican revolutionary Pancho Villa.

What emerged was part roadside attraction, motel, RV park and nine-hole golf course, in addition to the thousands of acres of surrounding land that include an old mercury mining town and hunting lodge. A crossing into Mexico, closed years ago, once ferried tourists across the river.

In 2000, when the property went up for auction, Mr. Smith outdueled San Francisco hotelier Manou Mobedshahi in the town's saloon with a $4.2 million bid. Mr. Smith called it the Ultimate Hideout, but the rich never came in large numbers.

"I'd be surprised if there are more than 10 people here," Mr. Warren said Thursday looking about. "In fact, I'd be shocked if there are more than six."

Nine of the 92 rooms were full, not including Mr. Warren's party.

'The coolest house'

On Friday morning, after eating breakfast and making sure the multi-million-dollar wire transfer for the property was in order, Mr. Warren drove friends down to the banks of the Rio Grande looking for the handmade home of Collie Ryan.

Ms. Ryan has squatted on the Lajitas property for 20 years, living in the rusted hull of a bus, near a dirt path leading down to the Rio Grande. She paints mandalas on old hubcaps to make a little money and support her songwriting.

Unable to find her, Mr. Warren wandered about with a look of wonder at the house, garden, stones and path running down to the river.

"She certainly has the coolest house," he said.

About 10 minutes later, Ms. Ryan appeared down the road, clad in denim with a pink bandana around her neck and gray hair loosely braided.

"What should we do here, Collie?" was Mr. Warren's first question.

"First let me shake your hand for asking that," Ms. Ryan said, lighting up as if nobody had approached her like that in a long while.

Soon, they sat in an outdoor living room by the outdoor kitchen and outdoor shower -- the woman who says she doesn't have enough time to make money and the businessman who can't seem to stop making money. Ms. Ryan said the area is like a space station, big and empty and spiritual. She said the exclusivity of the resort was like "misery ground into the walls."

"It produced a feeling that no matter how nice the adornment, it made people feel nervous," she said. "It didn't feel right."

"There's a certain kind of people who need this place."

Ms. Ryan told Mr. Warren she remembers years ago when the bar would have millionaires mixing with landscape workers and artists and models. They talked about reopening the border crossing, reaching out to the community and about music. He bought a CD from her and promised to come back with his 5-year-old son.

"Now I've got to go back to a different world," he said.

But back on the road, he was still thinking about the woman.

"I'm telling you. That's who I want to be and I can't," he said.

At 1:48 p.m., the wire transfer went through for the property. The deal was complete, except for a few papers that remained to be signed. A short time later, he returned on his jet and to Dallas. Lajitas, he hopes, may have another life yet.


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