A 70-acre section of the New Longview subdivision is under new ownership, with Mariner Holdings buying the mortgage and taking control.
David Gale, owner of Gale Communities Inc, which is developing New Longview and the Winterset Valley subdivisions, said Dec. 16 that Mariner Holdings took ownership of the property Nov. 22. Gale said he retains ownership of significant parts of New Longview.
Mariner, a Leawood-based global capital investment firm, took possession of its property in what Gale termed as a “friendly foreclosure.”
“It gets me out of the shadow of that debt so I can continue looking forward,” Gale said.
Gale Communities Inc. continues to own the Longview Mansion, the water tower, commercial property along Third Street and Longview Road including several buildings, and residential-zoned property yet to be developed.
Gale recently closed a deal and the city approved a McDonald’s restaurant to be built on Third, east of the CVS/pharmacy and a gas station. He said that purchase indicates a bright future for New Longview.
“That’s the stamp of the champ,” Gale said.
Chris Martin, who is handling the transactions for Mariner, did not return phone calls for comments. He is an employee of Cohen Financial, a Mariner subsidiary.
Jim Thomas, of Hearthview Residential, which in late 2012 got city approval for a new upscale apartment complex along Longview Road on land now owned by Mariner, said his team spent a lot of time working on that project.
“We’d like to continue, we’re in discussions with the owner of the land,” Thomas said.
City Manager Steve Arbo confirmed the change in ownership and that Gale Communities continues to have ownership in parts of New Longview, as did a check of county records.
The New Longview TIF requires the city to be informed of ownership changes.
Arbo said that Mariner has not yet filed any development applications with the city, but he expects there will be some activity within a few months.
“They’ll want to develop property they own,” Arbo said.
Arbo said that once the dust has settled on the ownership and financial changes, he hopes to arrange some meetings with homeowners of New Longview subdivision and R.A. Long Historical Society so Mariner can update them on its plan.
Gale said the back story on the foreclosure played out in the nationwide economic meltdown.
As he and other developers struggled to stay afloat, they accrued interests on their debts, unable to make payments, while their lenders had their own problems.
One of his creditors, First Community Bank was in meltdown with regulators forcing it to sell assets, it was being acquired by Equity Bank, Gale said.
Gale said he was negotiating a sale of the barns with an investment group out of Tulsa, Okla., in tandem working on an agreement to sell 13 acres for the apartment complex.
He delivered signed documents for that deal to Equity Bank for approval on Dec. 24, 2012, but that bank already was selling its notes on Longview to Mariner.
Gale said as a result the “title was clouded” for the property. The remedy, he said, was that Mariner conducted a “friendly” foreclosure, essentially a transfer of ownership of the 70-acres with his cooperation. He didn’t resort to court actions such as reorganization under a Chapter 11 bankruptcy to try and retain ownership.
The 70-acres belonging to Mariner is south of Fascination Drive, it includes historic dairy and calf barns that under terms of Longview’s TIF where the exteriors are to be kept intact, but internally they can be remodeled for commercial purposes.
The Longview Farm’s show barn has already been converted to an elementary school and the Longview Mansion is operating as an event space.
Gale said he is continues to store his machinery in barns that now belong to Mariner and is taking care of the grounds.
With the recovery in residential developments, Gale Communities continues to sell lots and build homes in its residential projects New Longview and Winterset Valley subdivisions.
Gale said he expects to open another phase in Winterset next summer.
“As we juggled the ball for years, Winterset has been steady,” Gale said. “Residential is clearly working now, so we’re excited.”