By New Times
By Connor Radnovich
By Robrt L. Pela and Amy Silverman
By Ray Stern
By Keegan Hamilton
By Matthew Hendley
By Monica Alonzo
By Monica Alonzo
Why did he put his money into Radical Bunny? Easy, he says; it promised a solid 11 percent interest, while most everyone else offered 6 or 7 percent. The chance to make money with money appealed to many people with lesser means, Hansen says. "Hundreds" of people took out second mortgages on their homes and plunked money into Radical Bunny. Many will likely lose those homes, he predicts.
Bankruptcy records reveal that hundreds of Radical Bunny debtors are owed hundreds of thousands of dollars each, and much of that is tied up in the failed Centerpoint project. Several, like Hansen, had invested well over a million dollars.
The Securities and Exchange Commission announced this summer it was investigating claims that Radical Bunny misled clients.
At least Hansen still has a pension to live on. But he'd hoped to bequest a small fortune to his kids, stepchildren, and grandchild, who could use it for college.
"Now, I have nothing to leave them," he says.
At press time, a judge was preparing to decide whether the condo project can be handed over to the group of former Mortgages Ltd. investors (the company is no more; just the debt survives). This new group is poised to make the tough choices. Is it better to off-load the towers at fire-sale prices (maybe to someone who would demolish them) and split the paltry proceeds, or to find a financial fat cat to fund the towers' completion, then sell them at a much higher price? Or maybe finish the towers and then try to sell the condos individually or in groups? Would the white-sand pool and other upscale amenities be part of any deal?
One thing seems certain: Losch, Dewar, and Tempe Land Company have thrown in the towel.
From the Loop 202 freeway, the Centerpoint towers look almost finished. Their windows, which reflect a light green color, appear intact. The buildings look no less habitable than the skyscrapers to the west in downtown Phoenix.
As you get closer, though, you see wind-whipped plastic in the place of some windows. Many of the balconies are bordered by weathered two-by-fours.
At the base of the towers, there's no hiding that it's still just a construction site: Raw dirt surrounds the north and east sides of the five-acre site, peppered with pipes sticking up from the earth. Piles of loose windows, some broken, lie in racks or stacked on the ground near other debris. Inside the cavernous, concrete-dominated space for a plaza and shops, temporary shelves are loaded with boxes and equipment.
The whole place is surrounded by a dilapidated chain-link fence that sports faded, ripped advertisements showing what life at Centerpoint was meant to be: great food and spirits, people laughing and enjoying the bird's-eye view.
Next door to the Centerpoint project, at Tempe Fire Station Number 6, Captain Don Jongewaard thinks about the Big One. He and the firefighters he supervises often "tabletop" about what to do in case of a fire at the towers. The first thing would be to call for backup from fire departments around the Valley, because a high-rise fire would be a major calamity.
Statistics show that vacant buildings tend to burn more than filled ones, whether from arson or other reasons.
"There's always a bigger risk, just because the place is not being kept up," Jongewaard says.
The towers were designed to make it easy for firefighters. Breathing-canister refilling stations are already installed on every third floor of each tower. Fire sprinklers are installed, too — but aren't operable.
Fire inspectors go up into the towers every few weeks to make sure there's no danger, city officials say. But the inspections missed something — the trespassers. Their reports say nothing about any intruders.
Assistant Fire Chief Marc Scott, the inspectors' supervisor, and the man in charge of fire safety at the Centerpoint condos site, says he had no idea that trespassers were gaining entry to the towers until New Times told him.
The three biggest causes of fires are "men, women, and children," Scott says wryly. "Transients going in and out of there . . . that could be a problem."
The reason the sprinklers are inoperable is that there is no water pressure to them. "Would I like to see the sprinklers turned on? You betcha," he says.
But water and electricity to run the pumps cost money, and that's in short supply for the towers.
Firefighters acknowledge that a towering inferno is unlikely in the unfinished buildings, which are made mostly of concrete and contain few furnishings.
The point is, empty buildings are nothing but a problem.
Large, unfinished construction projects are eyesores, reminding citizens that life isn't always peachy. Property values near them tend to fall or stay roughly the same year after year. City leaders were happy to see the towers' windows installed after most of the other work was halted. Without windows, the condo towers would have that bombed-out appearance, like Elevation Chandler at the intersection of Loops 101 and 202 — another Mortgages Ltd. project.
Centerpoint's exterior may not look so bad, but the extreme heat has taken its toll on the interior. In arguing for the emergency loan funds, Losch testified that temperatures in 2008 soared to 190 degrees and warped $3 million worth of cabinets. In another court transcript, one of Tempe Land Company's lawyers stated that some doors and furniture were also affected by heat last year.