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					                                            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

				
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