Wachovia Sues Developers over Defaulted Loans for $565M Las Vegas Residential Project
- Oct 24, 2008
Wachovia Corp. has filed a lawsuit in U.S. District Court in Manhattan against the group of homebuilders behind a gargantuan planned community in the Las Vegas area, in hopes of recouping at least $358 million in loans made for the $565 million project, which has been scrapped. While the specific name of the project is not identified in Wachovia Bank National Association v. Focus Kyle Group L.L.C. et al, the description of the development and of those behind it match a project called Kyle Canyon Gateway. In addition to Focus Kyle Group and Focus Property Group chief executive John A. Ritter, defendants include: KB Home Nevada Inc.; KB Home; Lennar Communities Nevada L.L.C.; Lennar Corporation; MTH-Homes Nevada Inc.; Meritage Homes Corporation; PN II Inc.; Pulte Homes Inc.; Ryland Homes Nevada L.L.C.; The Ryland Group Inc.; Coleman-Toll Limited Partnership; Toll Brothers Inc.; and Alameda Investments L.L.C. Businesses on the defendant list are a near exact match to the list of businesses named as part of the group that won approval from the City of Las Vegas in July 2007 to develop a 1,712-acre community known as Kyle Canyon Gateway. The homebuilders and master planner involved were named as Focus Property Group, which issued the news release, Toll Brothers, Lennar, Pulte, KB Home, Kimball Hill Homes, Woodside Homes, Meritage Homes and Ryland Homes. The consortium had won the 1,712 acres in a U.S. Bureau of Land Management auction in February 2005. In the Wachovia lawsuit, the project at issue is described as involving 1,712 acres of land acquired at a U.S. Bureau of Land management auction. Focus Property Group and partners had grand plans for Kyle Canyon, which was to have sprouted in the northwest portion of the Las Vegas Valley, just off Highway 157. The concept called for as many as 16,000 homes of various housing types; commercial space that would have included a pedestrian plaza, and 127 acres of public parks and open space. A spokesperson for Las Vegas-based Focus Property Group declined to comment on ongoing litigation. As for the status of the project, she told CPN, “There is no status.” Kyle Canyon was still just in the planning stages.