The development team behind a proposed $1 billion complex of sports arenas in Henderson perpetrated a business fraud against the city of Henderson and the federal government, according to commercial litigation filed by the city against five defendants. Henderson officials say the real estate developer behind the proposed complex never intended to follow through and used the idea as cover to purchase 485 acres of federally-owned land and resell it at a profit.
The accused developer, along with two attorneys, a land consultant and a lobbyist, first approached the city with the proposed sports complex -- to be called the Las Vegas National Sports Complex -- in 2011. The complex was to be built on a 485-acre parcel of land belonging to the U.S. Bureau of Land Management. Artist renderings depict a number of buildings and four venues for basketball, football, baseball and soccer. The idea was to lure professional sports teams to the Las Vegas area to play at the complex.
The City Council approved the plan in September 2011 and rezoned the property a month later. The developer agreed to pay $10.5 million for the land in several installments. In early 2012, he said he had found financing to build a basketball stadium. But construction never began. According to the lawsuit, the developer instead began trying to sell small parcels of the land, which he never took possession of, for housing and commercial development.
Finally, on Nov. 28, 2012, the developer told the City Council by letter that he was terminating the project and put the remainder of the money he owed for the land into escrow. The Henderson City Manager said that one of the developer's lawyers told him that the developer "had been lying to the city" about the project all along.
With so much money at stake, it will be interesting to see where this litigation goes. We will keep readers updated on this story.
Source: VEGAS INC, "City alleges developer with arena plan only wanted cheap land," Eli Segall, Jan. 29, 2013