By Pacific Coast Business Times Staff Monday, May 3rd, 2010

The developers of North Park Village had their dreams to build a sprawling, luxury-home community outside Moorpark shot down years ago, but their liabilities for the ambitious project still linger.

Although voters rejected plans for the 1,680-home community in 2006, its developers are still on the hook for $22.6 million, according to a lawsuit filed this month in Ventura County Superior Court. Pacific Western Bank, the creditor, is seeking to foreclose and is asking the court to appoint a receiver to oversee the currently undeveloped property.

Kenneth Hennesay Jr., an attorney for the bank, declined to comment further on the case.

But William Messenger, a defendant in the suit and the co-founder and chairman of Newport Beach-based Messenger Investment Co., said “it’s simply a timing issue” until the property is sold. According to him, a conservation group is currently in talks to buy the 3,805 hillside acres north of Moorpark College.

Messenger said he has owned the land for more than 20 years, and always intended to build a residential community there. But his dreams were dashed first in 2006 — when voters rejected the proposal — and then again when the real estate market turned sour. For years, he hasn’t been able to find a buyer for the land. “Like any developer can tell you, everybody is struggling. It’s been tough,” he told the Business Times.

North Park Village would have been a master-planned community unlike any Ventura County had seen in years. With 1,500 upscale homes, 180 affordable units and 70,000 square feet of retail and commercial space, it would have added about 6,000 residents to the unincorporated portion of the county.

But the $1 billion project was rejected by voters in 2006 for the second time in seven years. Opponents said that the development — which would have annexed county land to get around city growth-control laws — would make the Moorpark community lose its small-town character.

Proponents and developers said the project would provide much-needed housing and luxury amenities, including a 52-acre lake and swimming lagoon, for area residents. North Park pledged tens of millions of dollars in cash and land to the local school district and the city in the form of fees.

Promising to build on less than a quarter of the property, the North Park developers also pledged a 2,121-acre nature preserve across the sprawling hills. But today, with development dreams crushed, it seems only the conservation portion of the property’s destiny remains. The land generates no income and sits largely unused, except for limited ranching and oilfield production on about 112 acres, according to Pacific Western. Another 200 acres are subject to drilling rights, although those haven’t been exercised.

Though the bank doesn’t seem to think the developers can make good on the loan, Messenger stressed that a buyer has been found. “It’s a timing situation with the maturity of the loan,” he said. The price in discussion would allow the loan and other fees to be paid back, he said.

Pacific Western, however, doesn’t seem to think so. In court filings, it is adamant that the property needs to be placed into receivership. The developers “have encountered financial problems” and “have no present ability to pay, and no prospective future ability to pay amounts due under the loan documents,” the bank alleged in the suit, filed April 13.
Property taxes on the parcels have gone unpaid for two years, it claims.

And while the bank also believes the property best lends itself to permanent open space or public-use facilities, it has not consented to the lender selling the property. Such a sale would be a breach of contract, the bank said in court filings.

Messenger said such concerns are simply not valid. “We have a buyer – it’s just a timing concern,” he repeated.

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