Wednesday, December 26, 2007

City and JRP Agree to Further Negotiations

After being in a state of flux since the Oct. 22 Garzini memo to JRP, Kuratek and Holzman signed and returned a Dec. 11 followup from Garzini. The followup requested their signatures to "...memorialize JRP's and JRI's (the investor group, such as it is) intention to negotiate in good faith the terms and conditions of a DDA in accordance with my earlier memo." This followed a harsher Dec. 6 letter that stated
If, on the other hand, there are one or more bulleted points set forth in my memo of Oct. 23rd that you are unwilling to discuss with the goal of incorporating them into the disposition and development agreement, we will consider all negotiations termintated.
The signed letter signifying JRP's willingness to negotiate appears to have been delivered in person at the City Council meeting Dec. 13.

A series of emails that preceded this signing gives us a little view into the status of the investor group that is to finance JR and share in the proceeds with the City. At this point, it consists of Kuratek and Holzman, with no large investor since AIG pulled out. The original structure with AIG as a partner, called Juniper Ridge Ventures, LLC, was never executed and filed. JRV consisted of Juniper Ridge Investors, LLC, AIG, and Juniper Ridge Partners, LLC (as the managing member). Juniper Ridge Investors, LLC, is composed of JRP and "our investor group". What that group is seems rather nebulous at this point.

Relevant documents:
Oct. 15, 2007 City Policy Summary on Juniper Ridge DDA
Oct. 22, 2007 Garzini letter laying out redline bullet points
Nov. 1, 2007 JRP Response (no letter, Bulletin article behind pay wall)
Nov. 30, 2007 JRP response offering to negotiate, perhaps with a mediator
Dec. 6, 2007 Garzini letter requesting acceptance of Oct. 22 bullet points
Dec. 11, 2007 letter requesting JRP signatures as proof of intention to negotiate

Will things be patched up? How long will this next chapter take to play out? Will the City ever receive a return? How close to bankruptcy will we come with a single tenant that received land at 50% off, paid no SDC's, and was given $8 million in further improvements for access? Will any other potential tenants agree to stricter terms than Les Schwab?

Only time will tell. The saga continues...

9 comments:

Anonymous said...

$8 million in further improvements for access?

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Excuuuuuuuse meee, but I see $15M ( million ) to date spent by city of bend, and $3.6M in from Les Schwab, and that means about $12M down the rat hole.

Also here's the big "IF", the LS sales agreement says shovel-ready, and defines that to mean that they ONLY pay for the building, and paving the rear-lot, thus I can see MILLIONS more to be spent. Then there is the Cooley $40M exit, ... When this is all over Les-Schwab is going to cost the Bend taxpayer $60 MILLION Dollars,

And Brewski says $8M, which side are you working for?

Your loyal opposition.

bruce said...

Re: $8 million in further improvements for access?

I was referring to the onsite improvements, specifically the Knife River contract for roads and infrastructure.

Cooley medium term improvements are required by ODOT before any more land is sold, so that will be a sunk cost. Hopefully it will benefit more people than the 350 working for Les Schwab. I'm more concerned about additional onsite infrastructure without any SDCs to help pay for them.

The LS agreement is the comparable, which is why HBM needed to mention it in his article last week. It has everything to do with pricing going forward.

If I was working for the city or LS, I wouldn't (privately) be all over Mayor Abernethy about their use of Executive Sessions. It is going to become very public in the next few weeks if nothing changes from within.

I'm working for myself. I want to see jobs that pay more than $10/hour around here, and JR has the potential to provide those. We already have enough barista and retail clerk jobs, and we have more than enough housing for the next few years. We need good jobs.

Anonymous said...

was referring to the onsite improvements, specifically the Knife River contract for roads and infrastructure.

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I agree to date the knife-river costs for the 'drive-way' are $1.5M over-budget, and I figure when its all done it will be $4.5M over budget, that's why I estimate $15M total for CAMPUS-LS, rather than the current $12M to date cost.

Note Knife-River uses 'PAPE' heavy equipment, and Brooks uses 'knife-river', aka 'hap-taylor' aka capell. Freidman & Tefler run HOA management, pay them self first, on the behalf of 'PAPE'. 'PAPE' owns the John-Deere ( big yellow ) heavy equipment franchise for Pacific Northwest. One of the richest familys in the regions, and major owner of Bend.

Is there any politician in Bend that is NOT co-dependent upon the success of the 500LB gorillas that RUN BEND-OREGON??

Anonymous said...

Bruce,

You have watered down your site so much that it now read's like an advertisement in The Bulleting for residential housing at Juniper Ridge.

How about add the 'DEED' to your list of sources, the DEED is clear about where JR was to go, and terms of the DEED are short and sweet.

Yet, you, the city, and Garzini consistently choose to ignore the terms of the original $1 sale of Juniper Ridge from county to city.

Why bruce, why to you parrot the same dribble that the BULLetin prints??

Anonymous said...

Bruce,

Ace reporter.

The City Hall got $3.5M from Les Schwab, $2.5M of which had already been 'ok-d' to be given to KURATEK(JRP).

You prove this transfer hasn't already taken place!

The vote on Oct 15, 2007 was a done deal, $2.5M to kuratek, with LS money, and they were waiting, on Dec 7, 07 the money was paid to the city, and then the city promptly paid Kuratek.

Prove this is not SO.

Anonymous said...

Bruce,

Below is relevant, because ALL of the $5-7M city-bond is going to Knife-River, and almost ALL their expense is to PAPE for leasing the equipment. Not only does the city-of-bend do an exclusive with knife-river/pape, but so does Brooks Resources. Note also the Councilor Friedman ( noted below ), was booted from "Ridgewater" for cooking the book-keeping books.

Message from the New Chairman of the AUO
January 2nd, 2008

I am writing on behalf of the new board to give you all an inside view of the events of the past two weeks leading up to the special meeting to remove six members of the old AUO board and replace them with a new slate of candidates introduced to you in previous posts. It has indeed been an emotional rollercoaster for the group of us most intimately involved.
At first, the task of tracking down all of the owners in a short period of time with the sketchy information finally provided to us by Bill Friedman’s office seemed overwhelming. We all received a rapid education in using the internet to find people. The encouraging and gratifying part of the job was that the assessment notices had grabbed owners’ attention and our position was an easy sell. We began to feel guardedly optimistic.
Then we learned several days before Christmas that the Papes had directed Patti McMean to make offers on a number of larger condos in an attempt to increase their ownership percentage. Pessimism reigned. As we learned that they had been successful in purchasing 4 or 5 units we redoubled our efforts to find the remaining “lost owners.”
We made contact with our final lost owner on the afternoon of the 26th and she immediately faxed in her proxy. Only two of the non-board, non-selling owners refused to support us. At 5pm on the 26th Lisa Kirbs and Peter Smith delivered proxies representing 50.813% of the common ownership to Bill Friedman. We needed 50% to remove the board. Our attorneys sent a strongly worded letter to Friedman saying that we would expect him to maintain the same level of confidentiality with the Papes as he has with our side and not leak the results. We were instructed by our attorneys not to discuss our knowledge of our prospective victory, as we wanted to keep this information from the Papes.
Nonetheless, on the day following Friedman’s receipt of our proxies, the Papes instructed Patty McMean to seek to purchase more condos in a last ditch, seemingly desperate, attempt to reverse the results. Some committed owners resisted these efforts but we learned that the Papes had closed several more deals. Our attorneys assured us that the only way to rescind and/or reverse a proxy vote after the 12/26th deadline was to personally show up at the meeting. Consequently we were on pins and needles at the meeting as many owners, including partial owners, stood in line to check in with Bill Friedman. It turned out that most of these owners were in line only to ascertain that their votes had been received and counted. In fact, to our knowledge, not one owner whose proxy we held actually attended the meeting and revoked their proxy, so we know that we did win the vote
I requested that as a board member I be allowed to observe the tabulation of the vote by Bill Friedman. My request was denied. As expected Jordan Pape stood up at the end of the special meeting and announced that we had not achieved a 50% majority and adjourned the meeting. At this point our attorney stood up and reported that we had in fact won the vote. I then announced that there would be an emergency meeting of the new board.
We did meet before a group of approximately 100 enthusiastic owners and had a successful first new board, or “unINNspired board”, as it was dubbed by one of our owners, meeting. Notable actions included rescinding the assessment, terminating Bill Friedman and Tamara MacLeod, the AUO attorney, and establishing a construction committee to oversee the necessary improvements to our buildings. Complete minutes of the board meeting will be posted on our website.
It is of interest that not only have our AUO funds been supporting an attorney, Tamara MacLeod, who has done everything in her power to obstruct the will of the majority of owners, but also the old board and Bill Friedman saw fit to hire an armed security guard to stand in the back of the room at the past two special meetings. The new board did not find it necessary to retain the security guard’s services for our board meeting. As I am unaware of any threats of physical violence from even our most irate of owners, I can only conclude that the armed guard’s presence was for the purpose of intimidation. The new board does not consider AUO expenditures of this sort either prudent or reasonable.
Thanks to all of you whose efforts and support made this outcome possible. Your new board promises to act in a completely transparent manner and work on behalf of all of our best interests. Any of you not presently included on my concerned owners email list who want to receive the most up to date reports on our progress, send me a email and include your phone numbers if you so choose. Best wishes for an exciting new year.

W. A. Peter Bours, New AUO Board Chairman
wabours@gmail.com
503-357-9684

Anonymous said...

Getaways a big chunk of Bend, Oregon's housing market; few mortgages involved

Bend, Oregon, Jan 02, 2008 (The Bulletin, Bend, Oregon)

"Nothing like fresh snow every day," says the 50-something retired lawyer from Portland, Oregon, who is visiting for the holidays with his two teenage sons and fiancee.

Call it Oregon's version of "Lifestyles of the Rich and Famous," where several weeks of the year wealthy folks from around the country drop in to visit their multimillion-dollar vacation homes in Deschutes County.

For the highly affluent, such second homes provide quiet escapes from the bustle of city life, a gathering point for fun family vacations, and, not least, a safe place to put a lot of money.

Green, who now sits as the volunteer chairman of Portland's public television station, OPB, spends about three weeks a year at his Mount Bachelor home that has a market value of around $10 million. He likes to visit during the holidays and the Bend Film Festival.

Skiing isn't the only thing that attracted Green to Mount Bachelor. He loves Bend, Oregon's variety of shops and eateries. And he's a big movie buff. But during Bend, he flies in his own chef from Portland. Fighting the festival crowds for a table on Main Street "is too insane."

He stakes out a similar stint each year at his other vacation getaway in Capistrano Beach, Calif.

Buying in Bend, Oregon was a natural for Green, a Crook County native who, in 1982, clerked for then-Chief Justice Warren Burger at the U.S. Supreme Court. Eventually, he landed as vice president and general counsel for Dell Computer Corp., retiring in 2005.

Green's five-level getaway is appointed with works of art and stylish furniture and big fireplaces everywhere. With fiancee Laura Gilbreath, he takes in the spectacular views from his cavernous living room. An elevator takes you to the pool table or the movie room.

"It's an incredible investment," he says of his Mount Bachelor and Capistrano Beach properties. "They've done great compared to everything else I've invested in."

Green is not alone as a second-home owner in Deschutes County. These days, two of every three dwellings in Bend, Oregon is a second home, according to Bend, Oregon Mayor Bruce Abernethy, himself a real estate broker.

Although some second homes help fill the all-important rental pool that keeps the tourist economy humming, many of the swanky abodes -- like Green's -- stand empty most of the year.

They range from a modest $600,000 one-bedroom condo to a $19.9 million, 13,000-square-foot mansion with a 10-car garage.

"In tough economic times, when there is a downturn in the economy, people tighten their belts and don't buy second homes," Abernethy said. "But the multimillion-dollar homes, nothing affects that market. They're recession-proof. And they usually aren't purchased with mortgages."

According to Deschutes County Assessor Scott Langton, second homes make up 36 percent of the appraised value of single-family Bend, Oregon dwellings. When it comes to condominiums, however, that number soars to about 80 percent. Bend City Councilors Bill Friedman and Chris Telfer are actively involved in managing monthly HOA fee's for all the condominium's in the city. "Our Cascade Bookkeeping Service makes it a one stop shop at city hall to take care of all your condominium needs in Bend, Oregon", Say's Bend City Councilor Bill Friedman.

Green's Bend, Oregon getaway keeps him in touch with his Oregon roots and provides a place for reunions of his extended family.

But customers for Deschutes County's second-home market are usually from such places as New York, Chicago, Florida and California, according to real estate agent Becky Breeze.

And most fit a profile: They're between 40 and 55; they made their own fortunes; they are family oriented; and they like the good life, she said.

Aside from "The Greatest Snow On Earth," the Bend, Oregon area has an advantage over Aspen, Jackson Hole and Lake Tahoe in that it's less than an three hours from an international airport.

That's one of the things that sold Los Angeles residents Lea and Barry Porter on a spacious house at Mount Bachelor's stylish Bachelor Village development with spectacular views of the Tumalo Reservoir and Sisters Mountains.

"Getting in and out of Redmond City is so easy," Lea said. "We can catch the 6 a.m. flight and be on the mountain skiing by 10 a.m."

The Porters considered buying a ski getaway at other resorts, but found Mount Bachelor more to their liking because it's more family oriented. Bend, Oregon offers conveniences -- like nearby grocery and variety stores -- that other resort towns don't.

"When you travel with three small kids, a nanny and a housekeeper, you need all the conveniences," she explained.

As Green discovered, upper-end Bend, Oregon real estate is a solid investment, say the Porters, who purchased their Bachelor Village house three years ago. So much so, that they also have purchased a multimillion-dollar condominium in the nearby five-star St. Regis Hotel, now under construction.

Vacation-home buyers like the Porters keep Bend, Oregon's construction business booming and provide jobs for an army of maintenance workers. And their property taxes -- 40 percent more than those levied on primary residences -- pay a huge share of the budget for roads, sewers and schools, said Abernethy, the mayor.

And that's not all -- the Bend, Oregon Board of Realtors reports there are more than 2,100 licensed brokers and agents working the western Deschutes County area. It includes such upscale developments as The Shire, Glen Wild, Tetherow, Arrowood, Pronghorn Ranch, Juniper Canyon and Mount Bachelor.

Sandy Coleman, who has been in real estate in Bend, Oregon for more than a quarter century, says buyers don't have to be worth $100 million to purchase in Bend, Oregon. A two-bedroom condo at places like The Lodges at Mount Bachelor can be scored for $850,000 to $950,000.

"People are saying, 'I'm not getting any younger and I've always wanted a place in the mountains." "

The fact that many second homes stand empty most of the year doesn't seem to bother the owners or the townsfolk, said Bend, Oregon resident Ira Sachs, who lived at the West Lodge in Mount Bachelor Village's Silver Lake area for 17 years before moving north of town.

"I didn't see my neighbors except for Christmas and President's week," he said. "It was wonderful."

Anonymous said...

"It was sold to the public as a place for industry and education, but seems to be morphing into something more like a planned community of mostly housing and retail."
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BULLSHIT BRUCE, read the $1 DEED it says, ONLY FOR INDUSTRY, and 10% to Parks.

That's it, not a fucking thing about education. Why must you pull that shit out of your ass??

You want to try and be authenticate, but then you have to make shit up. Just stick to the truth, .e.g. the facts.

Read the fucking DEED bruce, Read the fucking deed.

Anonymous said...

Taking long-term view of city’s financial picture
Plan being developed, but it won’t help Bend now
By Peter Sachs / The Bulletin

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Ok, so the city is spending $35k of our money on hiring 'experts' to tell them what to do!

Anyone want to bet that Cascade-Bookkeeping is the firm retained for advice? Have a problem hire PR, have a money problem hire a CPA.

Good article right now about Cali, how in ten years their spending went from $50B to $150B. They're bankrupt. How did they do it?? They went off budget, they got bonds, as the general fund couldn't support their spending. Bend is doing the same thing. This BULL article today is BULLSHIT, as it doesn't address the spending. Most of the spending is off-book, and done through bonds.

It's not what Bend spends, its the DEBT they're taking on that will fuck us, like AIG telling Bend this past summer it needed to pay 20% for Juniper-Ridge money. When your in debt like Bend, soon all the taxpayer revenue will be used for debt.

Trouble is Capell, Friedman, ... et-al, all profit from spending ten's of millions a month on Knife-River BIG projects, that are off-budget but financed by bonds. Bends rich continue to get rich, and Bend continues to get into debt, that will effect all of us, who aren't leaving this shit-hole.