CEO of Bankrupt Consolidated Resorts Challenges Asset Marketing Plan
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Las Vegas, NV, December 4, 2009 – In June, 2007, Consolidated Resorts’ CEO Arthur Spector cut a deal with Goldman Sachs Group affiliate Whitehall Street Real Estate Funds. Under that deal Whitehall’s most recent fund, Whitehall Street Global Real Estate Limited Partnership 2007, made a substantial investment in the parent company of Consolidated, ASNY Holdings. The new venture was called ASNY Holdings, LLC.
Spector continued as the managing partner of the new joint venture and a substantial holder of the new company, while Whitehall held the purse strings to the tune of $327 million. ASNY maintained its principal offices in Las Vegas.
Anyone in the timeshare industry that doesn’t know the ultimate result of that venture must be living under a rock. The recession hit, the timeshare industry went south, and earlier this year Goldman/Whitehall walked away from its investment, leaving ASNY holding the bag. As a result, Consolidated Resorts, Inc. filed for liquidation under Chapter 7 bankruptcy in July 2009.
Founded in 1982, Consolidated Resorts, Inc. was ASNY’s principal operating subsidiary. Consolidated had resorts in Maui, Las Vegas, Orlando and projects in development in Palm Springs and Kauai. The main project it was selling at the time was Tahiti Village in Las Vegas.
Just about everything from within Consolidated’s offices and sales decks has been auctioned off already, but Spector objects to the bankruptcy trustee’s plan to market the rest of the assets. Spector’s ASNY Co. LLC filed a brief in November challenging the marketing plan. The trustee, William A. Leonard Jr., was not pleased by the brief, saying in a Nov. 15 court filing: “A cynic might accuse ASNY of working against the coordinated sales process for a very selfish goal-to drive down the value of the Estates’ assets so that it can pick up the pieces through a disjointed, unorganized process for ‘a steal.”
A hearing was to be held on Thursday, Dec. 3, with Mr. Leonard hoping the sales procedures for Consolidated’s assets would be determined at that time. I haven’t heard how that hearing went, but stay tuned (as they say). As soon as I get word on the outcome of everything I’ll let you know.
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