Developer insists CentrePointe will be built despite death of key financier

bfortune@herald-leader.comApril 10, 2009 

A key financial backer of the planned CentrePointe development in Lexington died last fall, but the project's California trustee says he is working with the financier's heirs to keep the $250 million deal on track.

Los Angeles attorney Richard P. Crane Jr. said in a letter to Lexington officials that the death has "complicated the implementation of the funding plan," but he remains optimistic about the future of the proposed 35-story luxury hotel and condominium.

"All indications are that the successors will cooperate to complete the funding as per the agreement and to complete the project," Crane wrote to Mayor Jim Newberry and members of the Urban County Council.

The identity of the deceased financial backer and his nationality must remain undisclosed for privacy and contractual reasons, Crane stated in his letter.

As the trustee appointed by investors to administer the CentrePointe funding transaction, Crane said, he has made three overseas trips in the past four weeks "to secure and insure the continuation of the planned and committed funding."

In an agreement negotiated last year, the international investor "unconditionally committed to fund $250 million U.S. dollars to the CentrePointe mixed-use project on an 'all equity basis,'" Crane wrote.

Lexington developer Dudley Webb insisted Thursday that the financial agreement "survives." However, the financier died without a will, so his estate has to go through probate court, Webb said. The eldest son has been designated by the family to represent them in settling the estate, he said.

Webb said Crane's letter was sent to quiet any skeptics and dispel rumors that the project, which was supposed to be under construction by December 2008, has collapsed.

Specifically, Webb was upset by comments he said were made by Vice Mayor Jim Gray "that our financing is dead."

Gray replied on Thursday that "it's ridiculous that Dudley Webb is now trying to scapegoat me for the project's shaky condition. Our downtown's future is tied to a shaky scheme that requires secrecy and now, as it unravels, the need for a scapegoat."

Gray also urged Mayor Jim Newberry to be more forthcoming about the project, saying "we need his leadership now to determine the city's future."

In a statement, Newberry said he was "sorry to learn about the delay, but pleased that the developers and investors are still committed to the project."

Newberry said he is not concerned about construction being under way during the 2010 Alltech FEI World Equestrian Games "because the site will be appropriately contained."

Construction of CentrePointe is projected to be a 24- to 30-month project.

The only way the project could have been completed in time for the games was to start in April 2008, Webb said. "Now we are where we are."

In an interview Thursday morning, Webb pledged to "do everything in our power to make sure the games are not disrupted.

"It is our intent to go forward unless the community and we all decide it's better halting this project 14 months. That won't kill anybody," he said. "If the community wants to sit down and talk about it, we're flexible."

But in another interview about an hour later, Webb insisted there would be no conversation about delaying the project.

"This project is moving forward. It is our intent to build it," Webb said. "We'd love to create the jobs. We'd love to create the taxes, this afternoon, if we could."

Webb said 61 of 91 condominiums "have already been spoken for," but most individuals have not put down deposits or signed contracts, he said.

The tower will include 12 penthouses, the largest a two-story, 9,000-square-foot condo with a 360-degree view.

The Marriott Corp., which will operate a J.W. Marriott Hotel in the complex, remains on board, he said. The proposed building also includes 30,000 square feet of office space.

To make way for the project, the block along West Main Street between South Limestone and South Upper was cleared late last summer after a judge denied an activist group's petition to stop the demolition of 14 buildings.

"The judge seemed to weigh all factors carefully, but ultimately took the Webbs at their word when they said every day this project was delayed was costing them a tremendous amount of money and they were ready to start working," said Hayward Wilkirson, a founder of Preserve Lexington.

"I suspect I am like everybody else in Lexington," Wilkirson said. "It's just one excuse after another excuse. And I'm left wondering if we are going to have a hole in the center of Lexington indefinitely."

Councilman Tom Blues, a critic of CentrePointe, said Crane's letter is so odd that he initially thought it was fake. "I thought it was a hoax. It was so mysterious. It came on stationery that had no letterhead."

"A little bit more was disclosed" in the letter, Blues said, "but it is cloaked in vagueness and mystery and in secrecy."

Reach Beverly Fortune at (859) 231-3251 or 1-800-950-6397, Ext. 3251.

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