Tamarack Resort plans to sell $670 million in bonds

POSTED: 16:35 MDT Monday, July 28, 2008

by Associated Press

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Tags - bankruptcy, development, Tamarack Resort

Tamarack Resort in central Idaho aims to sell $670 million in bonds to boost finances after a real-estate market slowdown brought construction to a standstill and chased off investors, including tennis stars Andre Agassi and Steffi Graf.

A state-created lending organization, the Idaho Housing and Finance Association, gave its preliminary blessing to issue the bonds, but said it would give no financial backing or support, CNN reports.

Jean-Pierre Boespflug and Alfredo Miguel Afif, who own the Donnelly-based ski, golf and lake resort, have sought bankruptcy protection and been sued in federal court by investment bank Credit Suisse over a $260 million loan default. Boespflug's Cross Atlantic Real Estate owns 48 percent of Tamarack, while Afif's VPG Investments has 27 percent.

Tamarack lobbyist Scott Turlington said Monday the resort would use bond proceeds to complete unfinished buildings, make good on more than three dozen liens filed by unpaid contractors and repay debt to Credit Suisse to resolve the loan dispute. Afif is working with undisclosed institutional investors to purchase the bonds, Turlington said.

"We're extremely encouraged by the process. This is one of several different fronts we're approaching in trying to do our refinancing," Turlington said.

Among unfinished projects at Tamarack is the six-building "Village Plaza," a retail center that had been slated to open this year but stalled when funding collapsed.

Last month, Agassi, Graf and other investors cited unresolved court fights and market conditions when they ended a contract to buy Tamarack property for a proposed luxury hotel to be managed by Toronto-based Fairmont Hotels and Resorts.

A spokeswoman for Credit Suisse didn't immediately return phone calls seeking comment about the bond plan. Tamarack is among several resorts, including Montana's Yellowstone Club and Utah's Promontory, where the Swiss-based bank's investments have soured.

According to Tamarack's plan, revenue bonds would be issued by the Idaho Housing and Finance Association, which was created by the Legislature 36 years ago but isn't a state-supported agency. Interest from the bonds would be paid from the proceeds of Tamarack real-estate sales, while resort assets would be pledged as collateral.

The association, whose board of commissioners gave tentative approval to the plan Friday, said no state assets would secure the bonds.

3 Comments

This is way beyond the original scope & mission of the IFHA, which was intended to help struggling first-time home buyers get a house. Moreover, it's the way EVERY OTHER state uses their versions of the IFHA. Just last legislative session our corrupt political class turned IFHA into a kind of omnibus development agency with even broader financial conduit powers to help developers of all ilk.
If Idaho had home-rule, then the locals at Tamarack could craft their own legal mechanism & financial solution. Instead, this kind of "mission creep" will ultimately result in a major default, and despite all their protestations to the contrary, some powerful bankruptcy judge will rule against IFHA. And they will mandate the state of Idaho, or at least its created entity the IFHA, stood behind all these speculative schemes with "full faith and credit". Like a toxic chemical poured in 1 spot in the garden, there goes everything else's credit rating, as it spreads.
Idaho towns, cities, and counties need full, constitutionally-protected home rule powers, like EVERY OTHER STATE west of the Mississippi....so they can establish & have their own standalone credit facilities.
Comment By Bill
Tuesday, July 29, 2008 @ 10:08 AM

Can't make the 260 loan, so we amp that up to 670 and hope the same failed revenues streams come thru this time? And an Idaho GSE generously steps in to secure a private company? Wow.
Since we are so excited to bail out 2 playboys and save minimum wage, seasonal jobs, maybe we can step up with the same largesse when the next Oracle comes to town looking to create permanent, high paying jobs.
Comment By Joe Blow
Tuesday, July 29, 2008 @ 11:30 PM

Joe,
Don't count on that, an Oracle would result in too many independently talented people, making big bucks, all capable of individual critical thinking skills, and undeterred by the [bulls**t] policies of our political class.
Man, that's way, way too much freedom for the peons.
Comment By Bill
Wednesday, July 30, 2008 @ 2:15 PM

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