The newspaper reports:
Billed as the "Ultimate Hideout," for the rich and powerful, the $100 million Lajitas Resort in far West Texas may be headed for the ultimate indignity.
A New England finance company, which a year ago lent the resort $12.5 million for improvements, has filed for foreclosure in Brewster County.
According to the public notice posted this week, the property — which is open for business — is set for sale to the highest bidder on the courthouse steps in early June.
Stephen Smith, the Austin telecom tycoon who built the resort, could not be reached for comment. His resort manager told the paper that it was basically much ado about nothing, a pressure tactic being applied by a lender with which the resort has had running disputes.
However, the article goes on to report that the improvements that were supposed to have been made with the $12.5 from the lender have, for the most part, not even been started. And that the Lajitas Resort's tax statements tell a tale of financial woes:
... the mantra, "If you build it, they will come," apparently works better in fictional baseball movies than for real-life West Texas resorts.
Lajitas never has broken even. Land sales in the planned subdivisions have been slow, and the resort sometimes resembles a well-primped Western ghost town in the hot summer months.
Signs of financial stress continue to hover over the resort, which for the second consecutive year was late in paying its Brewster County taxes.
Hotel receipts reported to the comptroller's office reflect a slow but steady decline in business.
For the past four quarters, Lajitas generated $1.65 million in receipts, down from $1.8 million for the year before that, and from $2 million for the year earlier.
Smith's personal finances also have been under stress lately. In April, a suit filed by him in U.S. Tax Court against the IRS over $140 million in contested tax shelters was dismissed before going to trial.
Full report (you may need to visit bugmenot.com is you are unable to get into the site to read the article)