Courthouse steps: Minor facing million-dollar foreclosure
"This may be a squeeze-play to get him out of the farm," says real estate expert Gibson, "but I don't think he's gonna be homeless."FARM PHOTO BY HAWES SPENCER; FILE PHOTO JAY KUHLMANN
Halsey Minor, the raised-in-Charlottesville entrepreneur whose successes include Salesforce and CNet but whose recent forays into jet-buying, hotel-building, and horse-racing appear to have taxed his voluminous coffers, is now going through something that's becoming all too common in recession-racked America: foreclosure.
But there's nothing common about Fox Ridge Farm. A 205-acre spread with a brick mansion, spectacular Blue Ridge views, and one of Albemarle's largest equestrian barns, the Farm will be sold December 21 on the steps of the county courthouse–- unless Minor's Fox Ridge Farms Holdings LLC makes good on the loan he put against the Free Union-area property earlier this year.
Minor is the owner of the unfinished Landmark, a 101-room Downtown Mall luxury hotel now mired in liens, litigation, and sheets of Tyvek flapping in the breeze. Late last month, a Charlottesville judge, while granting Minor the right to refile his suit against former developer Lee Danielson, called the litigation a "nightmare."
As for Fox Ridge, it was a dream home early in the century to Minor, his first wife, and first three children before a return to multiple dwellings on the West Coast. A planned equestrian operation appears moribund, although Minor has donated the use of the multi-cupolaed barn for several charity balls.
Minor says the loan came from local investor Mark Giles "and whatever individuals he may be affiliated with," but Giles, the founding president of Virginia National Bank, declines comment. "I never talk about private transactions ever," explains Giles.
Public records indicate that, in April, attorneys for the Harrisonburg office of the Lenhart Obenshain law firm served as trustees for what appears to be the Giles loan, a cool one million dollars.
A search of the County's building permit database shows no construction activity for several years at Fox Ridge Farm, but there's no taboo against squeezing cash from one's equity. There is, however, a taboo against not paying one's bills.
"He may have stopped paying, or he was light with his payments somewhere along the line," says Charlottesville real estate expert Wallace S. Gibson. "And then somebody, rather than taking his okay-I'll-pay-you-next-Tuesday, got scared, and foreclosed."
On Saturday, November 28, Lenhart Obenshain attorney Nancy R. Schlicting published a foreclosure notice in the Daily Progress, offering Fox Ridge for sale to the highest bidder. Even though prospective buyers must present cash or a cashier's check for $75,000, they can't get the sumptuous property–- including swimming pool, formal gardens, and nearly a mile of Moormans River frontage–- free and clear. There's a first deed of trust blocking the way.
Gibson notes that usually it's the holder of the first deed who forecloses, wiping out all subsequent debts. In this case, however, the first loan appears much larger–- $6.5 million as of two years ago–- and lent by a company potentially much angrier with Minor. More on that in a moment.
"The bidder has three choices," advises Gibson, in dealing with the first mortgage. "They've got to assume it, refinance it, or pay it off. This is convoluted, and it takes high dollars."
And then there's a question of dollar value. Unusually for a property carrying up to $7.5 million in debt, Fox Ridge merits an assessment under $4 million, according to county records. Albemarle assessor Bob Willingham explains.
"The reason for the lower assessment is that the land is all under easement, and by law we have to reflect the loss in value by the easement to the third party," says Willingham. "There are exceptions to the fair-market standard, and this is one of them."
Gibson says that a private appraisal probably justified Minor's most recent loan and might support a higher valuation. Nonetheless, it's a crowded time for sellers in fancified Free Union.
According to online listings, the 636-acre Georgetown Farm, owned by 80-year-old distillery heir Edgar Bronfman, is listed for $17 million. And 1,478-acre Chapel Springs Farm, formerly known as Burning Daylight Farm and now owned by concrete magnate Wick McNeely, is listed for $13.5 million.
As for Minor, as the head of San Francisco-based Minor Ventures, he hasn't rested on his early masterstrokes, despite amassing a reported $355 million in wealth at the height of the late 20th century technology boom. Two years ago, he sold GrandCentral, a company recently rebranded as Google Voice, for an amount estimated at upwards of $50 million.
More recently, however, Minor has faced three multi-million-dollar creditor actions including an October federal court's summary judgment in favor of Merrill Lynch Private Finance. He has angrily denied any cash-flow problems and traced the lawsuits to a sort of panic mentality among creditors. Could Fox Ridge's foreclosure be part of that?
Two days before Thanksgiving, lawyers for Merrill Lynch issued notice that they intend to collect legal fees on top of the court's $21.6 million award. And who holds the first deed of trust on Fox Ridge? It's First Republic Bank, a San Francisco-based company owned by none other than Minor's nemesis, Merrill Lynch.
Merrill Lynch lawyer Jim Perkins says he didn't know anything about the foreclosure and declined to discuss what actions Merrill may be taking to enforce the judgment.
Now dwelling in a rented Los Angeles mansion, Minor isn't blaming Merrill for this one. Instead, Minor contends that Giles foreclosed because Giles and Danielson, whom Minor fired from the hotel development, are best friends and golfing buddies, a rationale that Danielson calls preposterous.
"There will be no foreclosure," says an email from Minor, whose travails have been detailed in two cover stories (1, 2) in this newspaper. "Fox Ridge has as much chance of being sold this decade as I do appearing on the cover of the Hook with a halo and wings."
41 comments
@ Susan:
You obviously are not from Charlottesville. The eyesore IS due to Halsey Minors actions. No "may very well be" about it, as if there is doubt. Read some of the other articles on here (there are many recent ones concerning the "yesore) detailing his exploits. The man would probably turn his own mother out if there was any gain for him, and never admit that it was wrong. Before you post again, I suggest you educate yourself and find out who you are really sticking up for.
What is wrong with you people that you are so filled with jealousy that you cannot have empathy for another human being? I do not know Mr. Minor. But I do know that millions of Americans are facing foreclosure. Many because of circumstances beyond their control. Our government has billions of dollars allocated to care and services for illegals in our country. Yet, our out of work middle class homeowner is allowed to drown. They bailed out the credit card companies who are now charging these same people 30% interest on credit card debt, did absolutely nothing to help who had their savings and retirement money lost in the stock market crash, and are now facing homelessness because banks are foreclosing on their homes. These same people who cannot pay their mortgage and utilities do not have the funds to rent alternative housing. They are just trying to feed their families and keep the heat, lights and water on by accepting any offer of employment at minimum wage with only part time hours and no health insurance. Because they are still hardworking, poor Americans they are ineligible for federal and state benefits for food stamps, subsidized housing, free health, dental and eye care, and a cash subsidy which increases with the amount of children you have. Many of the illegals who receive these services also work for cash and take jobs away from Americans. I know this first hand, because of the many people who didn't get these jobs.
I urge you to have compassion for any American facing foreclosure, job loss, etc. There is no guarantee you will not face the same somewhere along the line. Instead, we need to focus on rebuilding our Country's economy, keeping people in their homes, eliminate government spending on noncitizens, send the non citizens home so there are more jobs available to Americans. We also need the government to reduce the interest rates being charged on existing credit card debt and existing mortgages. Additionally, home loans must be reevaluated and changed to reflect current market worth. Yes the banks will take a hit, but the American economy and taxpayers already took a big hit with the multibillion dollar bank buyout.
I urge you to explore the resources available to you to restore our citizens and our Country to prosperity. I further urge you to accept an attitude of gratitude and to help those in need. Our Country and our lives are on the path towards socialism and we are fully aware of the extreme poverty that exists for socialistic countries. It is the season of Christmas. Make your life mean something by giving back.
@Susan,
Have you been on the downtown Mall lately? Mr. Minor left an eyesore for everybody in Charlottesville to "enjoy" for years to come. Get off your high horse and realize that this man is not the victim here.
What would be best for the city? No one is going to want a luxury hotel on the Mall for quite a while, are they? I guess it depends on the economy. Supposedly the building is only suitable as a hotel due to low ceiling heights, but I'm not sure I buy that.
In Milwaukee, one of the developers asked the local court to appoint a receiver after the bank died (having strong-armed them into throwing good money after bad). What has happened in other cities? I know there are more than two of these $40m white elephants poking up around the country. How many involve dishonest deals? What does the FDIC do with these loans?
I'd like to see the city start some enforcement and then get a court order to seize & demolish the thing, if it's really useless. But that's just me. There is probably a better way.
Mr. Minor is assuredly not in the same financial situation. However I know quite a number of wealthy people who have had their financial security destroyed. Yes, their standard of living is different, but they experience the same pain, humiliation and lack of self worth as anyone facing a foreclosure.
The point is, DOES MAKING DEROGATORY, JEALOUS COMMENTS TOWARDS MR. MINOR ENRICH YOUR LIFE? If not, why do it? Negative thoughts stop us from achieving happiness. Spend your time on this earth contributing to something bigger than yourself. You will find that you can make a difference AND you will be happier for it.
Interesting that Wick McNeely is selling Chapel Springs Farm. Wasn't that the place offered for sale in by none other than Minor's dad as reported in this story in issue 0246 published November 20, 2003?
But still, nineteen point five million dollars? If agent Venable Minor, father of internet millionaire Halsey Minor, manages to sell Chapel Springs Farm for the asking price, it will set a record for county property, exceeding even the $17 or $18 million paid by currently-on-trial Tyco tycoon Mark Swartz for Keene's 1,400-acre Enniscorthy in 2001.
Seems to me that the time has come for him to put his money where his mouth is.
This is looking more and more like the typical ego implosion that occurs among succesful people.
The only way he can salvage things now would be to cash out, make everyone whole and start over.
I hear there are some good deals in Belmont these days.
His talk is cheap and his money ain't talkin. Soon to be ANOTHER statistic sad really.
Excuse me...."The indictment against Minor is that he played with them and is now claiming foal."
Horse on the brain...it should have read .."foul"...
Apologies to readers.
JK---didn't you go to school with Minor?
colfer, thanks for your sensible comments. Minor certainly seems to have some panties in a bunch on this thread. I've unsubscribed to this one.
I say let's cover the unfinished Landmark in solar panels and mount a large wind turbine on the roof, and party on. Lemons, lemonade.
Hawes and I are working on buying the property -- lock, stock and barrel.
As soon as the transaction is complete, we're tossing EVERYBODY else out of Free Union! :)
As a horse racing fan, I had hoped Mr. Minor would eventually take his mouth and put it into productive action, not counteraction. It would appear the intricacies of wealth and ego frequently take preceedent...or would that be the basic requirement to pay one's bills (speculations)?
The entire commercial real estate market has begun a marked, noticed sound of sucking period (as was predicted...look at Dubai, Trump, et al). The banks and investment people are garbage sucking, indebt, package and resell scum with a ton of special attention to "powerful" people. The indictment against Minor is that he played with them and is now claiming foal. Sorry, people that refinanced, ARM'd, etc are loosing left and right. You are no different. You seem to litigate AFTER the contracts and investments are signed; maybe you should do a better job up front.
Mr. Minor: I truly hoped for the best with you, but you are a disappointment on many levels. I still wish the best for you, but it doesn't appear that this will come to pass. Mr. Gates or Buffet don't seem to have your problems...why is that?...no horses, small egos, conservative consumption ethic?
What a senseless waste.
I would think that the Hook would be happy to put Halsey on the cover in halo and wings if Halsey were to actually ever finished his large failed erection on the mall.
Oh BTW this decade last for about 30 days- so not much of a promise to begin with
Isn't a foreclosure sale how Hawes bought the Jefferson? I hope that he swoops in and buys this property.
Castle Hill was $24mm I think. Chapel Springs asking price is $13.5
Cville should invite the artist Christo to come and wrap the unfinished Landmark hotel and then put on a Christo retrospective in the art galley next door. Convert that eyesore into a temporary tourist attraction. Then use the money to convert the building into a mixed use structure.
It amazes me how even wealthy people so badly mismanage their money.
I read a horse racing blog called The Paulick Report. Mr. Paulick reported on Minor's proposed purchase of a track that's already mired in another wealthy person's mess, Frank Stronach. Giddy up referenced this situation above in his/her post above. When many of us on the blog questioned Minor's ability to purchase this track considering he was already having financial problems, particularly in the art world, Minor himself began posting like an immature child berating those of us who had doubts.
It really was Halsey Minor. He lost any shred of credibility with me that day. I've no doubt this latest mess is of his own making not some bank conspiracy.
The charlottesville bubble blog has a post about his other house purchases
http://realcville.blogspot.com/2009/12/halsey-minors-residential-re-esca...
Gasbag Self Ordained Expert:
You could appear to be part of the problem (insider info maybe?)....not a part of the solution. You validate my statement that the mortgage trolls are a far bigger problem than the property owners...of which there are many that over extended themselves with the "industry's green light.
What was or is your role? Gee, what a claim to fame!
First in line at the courthouse steps...and bragging? What a piece of slime, without the courage to use a name. You are worse than Minor, if his situation is being reported correctly.
Garbage that is, has and still selling out ethics, integrity and this country.
Another site which suggested he was broke in early 2009
http://gawker.com/5182217/mouthy-internet-mogul-halsey-minor-might-be-broke
And this from the loud man who many in horse racing who like sheep bought into an idea of him being some white knight in the last couple of years to buy a track and make things right.
I never trusted his words and clearly in his wake he has a lot of financial issues mixed in with early success. I'm sure like the Salahis and their White House jaunt he too has plenty of explanations to offer.
Might as well throw in my usual skeptical relief on this story.
The hotel will not be finished without additional financing. The bank is gone and credit is slim. Minor and/or the bank stopped putting money in over a year ago. You may think it's preposterous that the Atlanta bank and Danielson were in a cabal to cheat Minor (and later to hound him, with Giles), but this bank is accused of the very same thing in a very similar hotel project in Milwaukee.
Look at it this way. The market started to crash and everybody said, not me, you pay, and closed up their checkbooks. Because whoever pays is throwing away whatever they put in for the foreseeable future. Neither side can fund the whole thing. The bank was on a slide to insolvency, and not the nice kind where they give you a chance to start over. Suppose the people there panicked and started calling up their loanees, cutting off the tap and demanding they put millions in cash into these bubble hotel projects. This is bank with no customers; it just assembles commercial real estate loans and repackages them for sale to regional banks, in a once lucrative operation affecting banks throughout the Southeast. So the guys who work there don't know how to do anything but make deals and now there are no deals to be made, and every asset they have is a lousy commercial real estate deal. Does that explain this story?
"Buyco... [states it] was told by project lender Specialty Finance Group LLC that Specialty would sell the development's loan to a 'loan shark' if Buyco didn't provide funds to complete the project."
http://www.jsonline.com/blogs/business/49108586.html
Specialty, the hotel finance arm of Silverton "bank" in Atlanta, was sinking fast and had absolutely nothing to prop it up except trying to wring money from whatever lendees might have wealth outside the real estate sector.
And someone posted in the previous thread on this topic (maybe Minor's lawyer?):
What this report leaves out is the Motion to Compel in Atlanta that states that the bank has steadfastly refused to turn over evidence to move the trial forward and that Minor is now asking for the Bank/FDIC to be held in contempt of court. This is the second such motion and the first one granted was ignored by the Bank.
http://readthehook.com/blog/index.php/2009/11/20/fraud-dismissed-but...
I have no connection to anyone in this case, but I think a little skeptical relief is in order.
Maybe he should write a book....
"How I turned a 350 million dollar payoff into 4 dollars cash"
Wondering if all these deal makers ever take the time to look in the mirror and ask--is it worth it ?
The View
Have you seen the new issue of the Hook.
Thank You.
J.S.
I read The Hook online only.
Waz up? :)
wake up !!!!!!! banks and developers are always teaming up to defraud poor unsuspecting businessmen who claim they know everything..I think that Danielson and the bank probably were in sync with Merrill Lynch and Sotheby's and Christie's...now Danielson and Giles are in bed together conspiring to foreclose on Minor...I am certain that Minor must have been up to date paying the money due Giles note and that Giles is foreclosing because he and Danielson played golf....and the astronauts never landed on the moon....my goodness is everyone wrong but Minor???? There is an Indian behind every tree goes the old adage that Minor believes.
Susan...
Somehow I don't think the people you are talking about would think that Minor is in the same situation.
IM JUST SAYING, I am very sorry that you have an eyesore in your city and it may very well be related to Mr. Minors actions. As your fellow poster acknowledged, perhaps there is a solution in having it condemned and demolished. Your only recourse is to get involved and try to do something. Being furious will not change the situation.
As a wealthy friend of mine once said, "What you see is what they have, and what they have isn't paid for."
quote: "Charlottesville is getting $5.8 million dollars in federal stimulus money and more than $3 million of it is going straight to the school system..."
If Charlottesville was really concerned about the so called "eyesore" on the mall, they would take this $5.8 million and apply it towards finishing the hotel. Because I still believe the taxpayers will end up finishing the hotel, just like we did the Radisson Hotel (Omni) decades ago.
Masters, I am far from anonymous here. You must be new to these parts.
My claim in based only upon the fact that the city taxpayers have already taken over and finished on large hotel here. The city government will not continue to allow the Minor hotel to sit down on their precious mall uncompleted. That you can bank on.
Come on when is this guy gonna admit he is broke? It is o.k. Halsey we are all broke. The only one this guy is fooling is himself. It is a bad thing when one starts to believe their own B.S. Halsey if you need to borrow a buck or two, I got you man, I know you are good for it right???
No, I am new to the area, and have never even heard of Halsey Minor before picking up a local paper about two weeks ago.
The city really should buy out what's finished so far. And invest in completing the hotel as well. It can be used for a homeless shelter. Most people have no clue as to how many people are outside homeless right now sleeping under bushes, trees and bridges in 25 degree weather. And it's only going to get worse in this current economy.
I suppose that for many people, watching a person who appeared to have everything, experience a serious difficulty is interesting.
Keep in mind though that the people who are foreclosing on Mr. Minor( who actually creates jobs when he is doing well) are the same people who charge multiple bounce fees to those who can least afford it, ruin the credit of college students, and extended credit to those least able to manage it. Thankyou Bank of America ! Oh wait, Merrill Lynch is owned by you now. What a coincidence.
I wish Mr. Minor every good wish, just as I do anyone with financial challenges just now.
Bryan,
I don't know that Christo is working just now following the death of her husband. I may not know Halsey Minor, but my son has met Christo and Jean-Paul.