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Originally Posted by SayTownboy
[b] Villaje Del Rio. Mixed-use redevelopment project underway with retail, office, and apartments. To be built off of of Broadway St. and the San Antonio River in north Downtown.
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This project is pretty much dead, unfortunately.... read these
Lawsuit, disputes plague project
Web Posted: 12/07/2004
Adolfo Pesquera
Express-News Business Writer
Real estate developer George Geis dreamed, toiled and campaigned for more than 13 years to transform an old strip of auto sales lots along Broadway north of downtown into a vibrant complex of apartments, offices and retail businesses.
Construction began on the 4.5-acre project in the summer of 2003 with a $17.5-million loan underwritten by the U.S. Department of Housing and Urban Development.
But the project is now more than a year behind schedule, and a falling out between Geis and an old friend has led to a lawsuit that, should the court decide against Geis, would strip him of control over the Villaje Del Rio development.
Geis had hoped to complete the complex — with its multistory central parking garage, 253 apartments and 48,000 square feet of retail and office space — by about now. Now he hopes to see it finished by early May 2005.
"We have to finish pouring the concrete," Geis said. "Then it's just a matter of finishing out, get all the curbs and landscaping in so the project looks complete."
Geis admitted that even excluding the many rain delays, the construction work is six months behind schedule.
"It is unusual," he said without elaborating.
Since the project's inception, four subcontractors had filed mechanic's liens on it. An electrical contractor and an engineering firm acknowledge they were later paid in full, but there was no county online record of a lien release from the fire sprinkler installer, who could not be reached.
Geis claims all were paid except a $481,302 bill from Safety Steel Service Inc., the firm that supplied and installed the steel for the parking garage.
"We're trying to get it resolved right now," Geis said.
Geis also is trying to resolve a lawsuit he is embroiled in with Marcia Sampson-Hayslip, a former friend who loaned him money for the project. Geis contends the suit is not affecting the project, nor has it taken up much of his time. Nevertheless, the dispute does not appear to be lifting anytime soon.
Geis took Sampson-Hayslip to court in February when she attempted to foreclose on the land. Her notice of foreclosure was filed because she claimed Geis refused to pay a $200,000 promissory note that was long past due.
A district court judge granted Geis a temporary injunction to prevent her taking the land.
Answering through her attorney, Thomas Bassler, Sampson-Hayslip complained that she had been involved in the project since 1995. She said she supplied the Villaje Del Rio name, provided the artistic renderings Geis relied on for his presentations to prospects, and was "repeatedly reassured (that she) was part of the team."
Sampson-Hayslip alleged Geis relied upon her contacts for clients. She spent $75,000 to renovate the old Smith Chevrolet showroom into a prototype of a Villaje Del Rio unit as part of Geis' marketing efforts. She also had intentions of running an interior design business in Villaje Del Rio.
She said their relationship ended when Geis would not repay the note, which came from monies she had taken out of a trust. She claimed that when she filed a notice of foreclosure, Geis evicted her from the Smith Chevrolet showroom without notice and confiscated some of her valuable antiques and heirlooms.
"I didn't evict her," said Geis, who believes the claim is the result of her attorney positioning her for trial. As to her other claims, Geis calls them laughable.
"It's 100 percent false," he said. "She never did any drawings, never did any designs, never put any money into the project and she didn't sign the note."
Geis, however, acknowledges that they were once good friends.
"That is what's so surprising about all this," he said. Geis claims the dispute is really over offsets between what each owes the other.
"She has a lien on the property that was not dismissed at closing," Geis said. "I have some offsets on rent where she was leasing a property from me."
Geis claims there was an undetected error when the promissory note was drafted that committed a parcel of land Geis was building his development on and mixed it in with parcels on land she was leasing.
"There's a title policy on the property guaranteeing that there were no errors," Geis said. "Nobody picked up on it, not even the title company."
Bassler said that if his client is successful with the foreclosure, "she would own the project. But realistically, if it gets to that point, they're going to pay us off one way or the other."
In addition to the money claims, Sampson-Hayslip is asserting through another attorney, Ed Batis, that there is a de facto partnership between her and Geis that should be formalized and recognized by the court. A trial date is set for May.
Meanwhile, Geis pushes ahead with the project, hoping for a settlement and anxious to get tenants. He has no doubt of the project's potential.
"We get about 75 calls a month," he said. "Over the weekend, I got about 12 calls. We're showing the commercial building now."
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Villaje Del Rio project still faces uphill battle
Web Posted: 04/02/2005
Adolfo Pesquera
Express-News Business Writer
Despite the disassembly of a construction crane this week, the developer of Villaje Del Rio — the conspicuously massive, partially finished apartment, retail and office complex at Broadway and Interstate 35 — insists the project may be moving forward soon.
Project owner and manager George Geis spent long hours this week with attorneys trying to salvage the project.
Villaje Del Rio was to have been his crown jewel. He has worked on the development since the early 1990s, planning for a central parking garage, 253 upscale apartments and 48,000 square feet of retail and office space.
Construction began on the 4.5-acre site in the summer of 2003 with a $17.5 million loan underwritten by the U.S. Department of Housing and Urban Development. It was originally scheduled to be complete by mid-2004.
But Geis had disputes with his general contractor, and now faces several lawsuits and nearly $1.7 million in mechanic's liens that subcontractors have filed against him.
Geis anticipates that the lawsuits will be dismissed soon and the subcontractors will return to work in about two weeks.
"We had a long meeting (Thursday) with the lender, HUD and the attorneys," Geis said. "It looks like we've got it resolved. But until the liens are paid, nothing is resolved."
Meanwhile, the only activity that has taken place at the project in recent weeks is the disassembly of the huge construction crane, left dormant for months. It belonged to the original general contractor, Dallas-based Andres Holding Corp. The company has since severed its ties to the project.
Geis became embroiled in a dispute last October with Andres. He notified the subcontractors Oct. 28 that he was terminating the contract. But Andres shot back, telling the subcontractors that it considered the termination legally ineffective.
"It fails to comply with the contractual requirements for termination and the owner has not identified a single fact to support its claim that Andres is in default," the contractor told the subcontractors.
Andres argued in its defense that Geis failed to make payments on time or to fulfill other obligations under the contract. The contractor stopped work Oct. 29, and since then the subcontractors have been fending for themselves.
But several subcontractors hard-hit by the project's halt filed hefty mechanic's liens and lawsuits.
Aluminum Window & Glass Store, a small San Antonio business, filed a lien in February for $319,084. Safety Steel Service Inc. claimed it was owed $481,302 for the steel it supplied and installed in the multistory parking garage.
CFS Concrete Forming Structures made claims against Geis and Andres totaling $715,795 for its installation of "all formwork, shoring and reinforcing and concrete."
Safety Steel Service and CFS Concrete Forming Structures retained attorney Lee C. Elms to represent them in separate lawsuits filed in December and March.
Geis said the subcontractors would not be paid as much as they claim in their liens because they included their retainages — accounts held by the bank that are drawn out on a periodic schedule to ensure completion.
"We want to get those subs back on the job," Geis said. "To show good faith, we're releasing a portion of the retainages."
Geis said he has not yet selected a general contractor to replace Andres, but the selection process is under way.
Meanwhile, Geis' lender, Boston-based Berkshire Mortgage Finance Ltd., was acquired through merger last December. The $26.7 million note now belongs to Deutsche Bank Berkshire Mortgage Inc.
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