By Ray Stern
By New Times
By Amy Silverman
By Stephen Lemons
By Stephen Lemons
By Monica Alonzo
By Chris Parker
By New Times
The RTC now hopes to sell the 12 remaining acres of the Esplanade at a public auction this April. But like everything else with the project, there are problems--specifically, with a parking garage. Symington built the underground garage that serves the two office buildings and hotel beneath part of the 12-acre parcel the RTC hopes to sell.
Such an arrangement will make for sticky negotiations if the buyer of the undeveloped land is anyone but Aldrich, Eastman & Waltch, the Boston firm that soon will take title to the three existing buildings. Although there is said to be widespread interest in the 12 acres, real estate attorneys say Aldrich, Eastman & Waltch is the odds-on favorite to get the land.
"Aldrich, Eastman & Waltch would be the logical buyer," says Tobin.
This is a crucial auction for Symington. While he's apparently managed to escape any liability on the $103 million loss suffered by Shimizu and Dai Ichi, he's still on the hook for the undeveloped portion of the land.
The RTC claims in its lawsuit against Symington that Southwest's investment in the Esplanade land--plus additional outlays for predevelopment expenses and foregone interest--resulted in a loss of at least $40 million for the thrift.
Symington says this is balderdash. In December 1991, a few days after the RTC filed its lawsuit against Symington and other Southwest officials, Symington told a news conference that Southwest's shortfall was only $17 million, and that the sale of the 12 acres would recoup some of that loss.
A few months earlier, Symington had estimated the undeveloped 12 acres were worth $13 million. If the land sold for that amount, Southwest would only be out $4 million--at least according to Symington's numbers.
What will the 12 acres sell for?
If the RTC's latest appraisal is any indication, not much. The RTC valued the property last year at $3.5 million. Maricopa County Assessor's Office came in higher at $6.7 million.
Once the land is sold, it will close the book on Symington's involvement in the Esplanade.
More important, it will firm up the figures brought to the negotiating table for a possible out-of-court settlement of the RTC's lawsuit against Symington.
The governor has shaken the Japanese off his back. Now he must go eyeball to eyeball with the RTC.
It's uncanny how well Symington has shifted the financial risk from his shoulders to others. This from a guy who lectured Senator Metzenbaum on the fundamentals of his Esplanade investment.
"I put that together, Senator. It's called private enterprise. I raised that money. I limited their [Japanese and Southwest's] risk. I personally took the risk to develop this project," Symington testified on Capitol Hill three years ago.
At the time of Metzenbaum's hearing, Southwest had long since collapsed. And three weeks after the hearing, Symington--who had run on his business record--was elected governor of Arizona.