By Ray
According to the Standard Examiner this morning the Junction's Earnshaw Building is in default for its 6.2 million dollar loan:
• Developer in default: Bank has 'solutions' to finish building in Ogden's JunctionHmm... thats a real confidence builder for building a hotel, parking structure, etc. with public backed loans.
16 comments:
There's one thing missing downtown: a gondola. If Ogden citizens werem't such stick in the muds, people like Earnshaw wouldn't be having these problems.
Is there anybody associated with Godfrey and the useless Richard McConkie who has not filed for bankruptcy, been fired, gone belly up, etc?
BTW, we do not yet know the extent to which the public will back the loans or if they will be issued for the imagined hotel and parking.
Let's not hang the city council just yet.
If they ultimately put us on the hook for a stupid project, on the other hand, let's fillet them, they burn them alive, as they will deserve. And let us do it joyfully, as such as that should be done.
But let's not sharpen the knives or light the fires just yet.
Congratulations to Mr. Jorgensen on his becoming head of the Ogden Rotary Club, and I hope he and his organization have great success in their charitable projects. I may spring for a raffle ticket or two since the Legislature, in its wisdom, won't let me spring for a lottery ticket now and then without driving to Malad, ID first.
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I'm glad the S-E did this story, but I do have a question: Why now? The news--that Mr. Earnshaw is in default--is ten months old. Anyone can plainly see that no work has been done on the building during those ten months. Did it take this long before Mr. Schwebke found the time to inquire into the status? I can think of some other follow-up inquiries that are equally overdue, but still of much interest to many of us.
The news in the story is, I presume, that the bank holding the paper on the unfinished building has found ways to have the construction completed so the condo units can be leased. Or says it has. Than announcement was evidently the news hook for the story, not the default per se.
Since the original developer has until August to "cure" the default, so to speak, by settling up, I gather nothing much is going to happen until then, but that at that point, the bank's "solutions" will take effect.
Not the clearest story the SE has run of late.
I do appreciate the Standard Examiner in the sense that it exists.
But what astonishes me is the laziness, lack of curiosity, lack of interest, lack of energy, lack of engagement of those people. I wonder how they can live like that.
But I wonder that about a lot of people.
Dan, the default was only filed recently.
Most of you are money addicts; our administration is little more than money-pushers.
It will be the ruin of you all.
Ed J.: Please explain! What does "filed" mean, anyway?
I actually heard a rumor about the default, from a source that I tend to trust, several months ago. And as I said, anyone can see that no work has been done on the building.
Dan, here's link to a site which explains the three steps (1) Notice of Default, (2) Notice of Sale, (3) Trustee sale) in the trustee sale (foreclosure) process:
The Foreclosure Process: Understanding How Foreclosures Work
Within the above link SE article we find this important language:
DE Ogden Development defaulted because it failed to pay the loan's entire principal balance, accrued interest and other charges by Sept. 20, 2009, according to records filed with the Weber County Assessor's Office.
Reading between the lines it would appear that a Notice of Default was indeed filed last year, (which conforms with your recollections,) and that ED Development indeed failed to cure the default within the 90 day reinstatement period which apparently ran on Sept. 20, 2009.
Therefore, I'll infer that the "filing" to which Ed J. refers is the "stage 2" step, the filing (recording, to be accurate) of the Notice of Sale, and that a (Step 3) Trustee Sale has now been scheduled for the second date mentioned in the article, Aug. 25 of this year.
That's my educated guess, at least, based on the fairly slim information contained in Mr. Schwebke's story.
And why did the lender wait so long to finally schedule the Trustee sale? Once a gain I'll make an educated guess and speculate that (1) the lender really doesn't want this overleveraged property on its books, and (2) the bank bent its back in the hope that DE would be able to arrange new financing with another lender.
What got Earnshaw in trouble was Earnshaw himself. Once he obtained his financing for the Earnshaw Building, he should have stepped back and turned the construction over to someone who knew how to construct. But, driven by ego, he decided he'd become the GC (General Contractor). Things quickly spiraled downhill from there: arguments with the City; positioning the actual building itself in the wrong place; his refusal to pay many of the major bills and/or to pay back the City for some of its expenses that were necessary to get The Junction development up and rolling; etc.
This may help to answer some of the questions, asked by WCF bloggers (and who erroniously placed the blame on the Administration or anyone remotely connected to the Mayor), as to why the Earnshaw Building construction appeared to be continuously stalled over the last few years.
Yep, ol' Dave was out of his league and in over his head from the git-go, and all he has to do is look in the mirror to find out whose to blame for this fiasco.
Twitter: The Ogden RDA, under Mayor Godfrey's leadership, has never merely sold property to the highest bidder--especially in a critical downtown location. The administration chose to sell a critical parcel to Mr. Earnshaw, believing that Earnshaw was capable of developing the parcel quickly and according to his stated plan. The City Council went along with that belief and approved the sale. According to what you've just said, there was no basis for that belief. So plenty of blame does fall on the city, and no city official bears more of the blame than Godfrey.
It should also be pointed out that Mr. Earnshaw made a $4000 contribution to Godfrey's 2007 campaign.
What about Earnshaw & Reid's latest thing in Santaquin City with yet another pie-in-the-sky hotel project? I wonder how that one is going? Sounds like they leave a path of destruction wherever they go. http://www.heraldextra.com/news/local/article_da570583-5359-53f7-b435-7f8a7b43ea20.html
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