|
Written by James Leonard | Patterson Irrigator
|
|
Saturday, 04 October 2008 |
Apparent final hurdle cleared, but Diablo Grande sale not yet closed
Diablo Grande is as close as it’s ever been to a sale, but its $20 million deal was not yet done as of Friday morning.
 Pi Photo File
But a hearing was called for Wednesday to adjust some of the language in the purchase agreement, and while the hearing itself was uneventful, it appeared to slow the sale process.
Representatives from both sides of the sale indicated late this week that no major hurdles remained. All that was left, they said, was paperwork.
At issue at Wednesday’s hearing, held at the U.S. Bankruptcy Court in Modesto, were groundwater rights, a water pump and a well that needed to be transferred from Diablo Grande to the Western Hills Water District — which provides water to the development — before the sale.
The pump, well and groundwater are part of a 153-acre agricultural parcel at the corner of Marshall and Davis roads south of Patterson. That piece of land was removed from the sale during negotiations, but the water rights and equipment were mistakenly removed as well.
“This is really the final major issue that stands between us and the closing,” Diablo Grande attorney Ori Katz said during Wednesday’s hearing.
Judge Robert S. Bardwil ruled the transfer could be written back into the purchase agreement. There was no opposition from any of the parties involved.
Still, it made closing the sale on time a little tougher.
Craig Stewart, senior associate with San Diego real estate firm Marcus & Millichap, has handled the Diablo Grande sale since the property was first listed for $150 million nearly a year ago. He said late in the week that he believed the sale would close late Friday afternoon or early Monday.
“The water issue was an issue — not a big issue, but just something that had to be resolved with the court,” Stewart said. “At this point, we’re just preparing all the documents.
“From what I understand, as of (Wednesday), everything is on track for the sale to close, pending any last-minute details.”
A secretary for Dwain Sanders, Diablo Grande’s vice president of development, said Friday morning that she was still getting paperwork together for the sale and that she believed the sale would close late Friday.
Sanders, who has not returned multiple phone calls seeking comment throughout the past two months, said after Wednesday’s hearing that he would not comment until the sale was complete.
Sanders did indicate that he believed the sale would close. Still, Stewart said not to count on anything until the final papers are signed and the money rolls in.
“We’re just crossing t’s and dotting i’s, but of course we need to see cash,” Stewart said. “We have (a nonrefundable $500,000 deposit), but the buyer could always decide to forfeit that money and walk away.
“Until the money is deposited in the escrow account, it’s not a done deal.”
When the sale closes, it will mark the end of a nearly seven-month bankruptcy process filled with contentious negotiations, considerable concessions and ominous overtones that if Diablo Grande did not find a buyer and settle with creditors, it could liquidate under Chapter 7 bankruptcy laws.
Assuming the sale to World International does close, the focus then will turn to the buyer and its plans for the project.
Diablo Grande sources have expressed optimism that the company will take over the initial plans for a resort hotel and see them to fruition, and that the new owners will fix the water quality problems current ownership has been slow to deal with.
 |
Subscribe to this comment's feed
