Wednesday, November 11, 2009
Red Leaves developer launches lawsuit
BY KAREN LONGWELL on the lawsuit. includes The Rock golf course, Estate to manage the one-day D e s p i t e t h e r e c e i ve r s h i p ,
Special to the North Star Court documents claim the Wallace Marine and future plans “fire” sale of 75 of the 87 remaining Jacobs is not worried about his
banking institutes “failed and for a village-like community with unsold units at The Rosseau, court investment.
Red Leaves developer Ken Fowler refused” to meet a commitment shops and as many as 4,000 dwelling documents allege. The receiver “We think the hotel has got a
has launched a lawsuit against a to advance a further $20.5 million units. opted not to close on the units, great future, they have just got to
banking institute that forced The to The Rosseau hotel project “We still believe totally in the which had already been sold before get through a little bump in the
Rosseau, a J.W. Marriott-operated a n d i n st e a d p r o c e e d e d w i t h project and Red Leaves will evolve the sale and this will result in road at the moment,” he said. “It
hotel, into receivership. the receivership. Ken Fowler’s and become the very spectacular further losses to the resort project, is a fabulous place … they have
I n M ay, Fowl e r ’s c o m p a ny, companies first sought financing development that we believe it according to court documents. had pretty well full occupancy
Rosseau Resort Developments for The Rosseau in 2005, court should be,” he said. A spokesperson from Baker Real from the summer.”
Inc., owner of The Rosseau in documents state. Estate could not be reached for Jacobs is confident his
Minett, entered into court-ordered Rosseau Resort Developments Quashed claims comment on the one-day sale. investment will pay off in the long
receivership after it defaulted Inc., a Fowler Enterprises-owned Fowl e r q u a s h e d c l a i m s i n Walker’s Point cottager Gordon run and in the meantime he gets
on its obligations to senior company, borrowed approximately another newspaper that implied Jacobs, who bought a condominium up to nine weeks of occupancy
lenders. $85 million from a senior banking his experience was limited to unit at The Rosseau in 2005 as at the hotel.
The firm of Alvarez & Marsal group for the construction of the restaurant developments. an investment, claims the one- Currently, the Baker Real Estate
was subsequently appointed as hotel, documents indicate. “I have been heavily involved day sale numbers are common website lists the condominium
receiver, and assumed day-to- The Fowler companies in real estate for a long time and knowledge. units with prices ranging from
day operations of the sprawling contributed more than $117 still am,” said Fowler. He claims the one-day sale had $294,000 to nearly $1 million.
resort complex. million in equity to the resort Ken Fowler Enterprises has 76 people interested in purchasing Janine Allen, a spokesperson
A lawsuit was filed against project, including approximately invested in hotels including the a unit. But under the condominium for The Rosseau’s public relations
banking institutions on September $50 million to The Rosseau, court Fairmont Hot Springs resort in act, the receiver must provide firm, Fleishman-Hillard, said the
10 in New York Supreme Court, documents claim. B.C, and others, he said. a d i s c l o su r e d o c u m e n t . Th e one-day sale was successful in
court documents show. After The Rosseau became Still, a long list of companies disclosure document states there telling more people about the
Th e su i t l i st s s eve r a l Ke n “distressed,” the bankers provided continues to await payment from are no assurances for profits hotel and has garnered interest
Fowler companies such as Ken new guarantees to the Fowler Rosseau Resort Developments and that there is no assurance in new visitors.
Fowler Enterprises Limited and companies, but later failed to Inc. In its seventh report to the Marriott will stay on to operate This fall and winter, despite
Ken Fowler Texas Inc., as well as follow through, according to the courts, receiver Alvarez & Marsal the hotel, Jacobs, who is part of being a tough time for tourism, The
Fowler’s son’s company, Peter lawsuit. noted that a total of 32 separate a condo-owner committee at the Rosseau has generated excitement
Fowler Enterprises Ltd. as the liens have been filed against the Rosseau, claims. for both leisure guests and meeting
plaintiffs. Declined to speak Minett property. Buyers have 10 days to back planners, said Allen.
The suit was launched against Reached recently by phone Ken The report indicates the out of the sale contract. S h e d e c l i n e d t o g ive exa c t
banking institutions WestLB AG, Fowler declined to speak about receiver is attempting to sort “Of the 76 people who signed numbers for bookings.
Toronto Branch; Toronto-based the lawsuit. out the relationship between contracts, 57 changed their mind “Unfortunately, we aren’t able
CIT Financial Ltd. and Austrian “It is in the courts … it is better Rosseau Resort Developments when they read the whole story t o p r ov i d e a c tu a l n u m b e r s , ”
bank Raiffesien Zentralbank we say nothing,” said Fowler. Inc. and Rock Ridge Contractors (disclosure document),” said said Allen when asked. “We are
Osterrreich AG. He did reaffirm his confidence Inc., another company set up to Jacobs. confident that The Rosseau will
Robert Dyck, executive director in the entire Red Leaves project. develop the hotel. However, six of the 19 buyers continue to see a good number of
of WestLB AG, Toronto branch, The Rosseau is one part of a larger I n Au g u st o f t h i s ye a r t h e who continued with the sale are guests booking for the fall and
could not be reached for comment Red Leaves development, which receiver appointed Baker Real current owners, Jacobs said. winter seasons.”
psns 08 November11 v1.indd 1 11/10/09 1:59:24 PM