Tuesday, September 2, 2008

Are Land Resource, LLC Developments Encumbered?

On July 9, 2008 Mike Flaskey, CEO of Land Resource, LLC advised the media that the company was forced to shut down sales operations in six developments. Flaskey cited a souring economy and banks reluctance to lend as the reasons for the closures. Land Resource has 9 projects under development. They are:

Bridge Pointe at Jekyll Sound-Waverly, Georgia
Cumberland Harbour-St. Mary’s Georgia
The Docks at Caney Creek-Kingston, Tennessee
Grey Rock at Lake Lure-Lake Lure, North Carolina
Laird Pointe-Panama City Florida
Roaring River-Fayetteville, West Virginia
Still Water Coves-Lincolnton, Georgia
The Villages at Norris Lake-LaFollette, Tennessee
Wild Ridges-Marion, North Carolina

Land Resource has stopped sales in two Western North Carolina developments, Grey Rock in Lake Lure and Wild Ridges in Marion.

On August 31, 2008, Land Resource issued a press release on their proprietary website advising that the company was still in negotiations with lenders. Land Resource Chairman and CEO J. Robert Ward said that company officials are… “focused on preserving the value of its enterprise for the benefit of all company stakeholders, including vendors, suppliers and most importantly property owners and customers. We will remain steadfast in the pursuit of the financing we need…”

On August 1, 2008 a Topix Land Resource participant said:

My heart goes out to everyone here, such a shame. I just wanted to throw something else into the mix. LRC's actions have extended far beyond the boundaries of their developments. Not only has LRC done an incredible injustice to the property owners, but they are in tremendous debt to many vendors. Some vendors are having to absorb losses so large that it might put them out of business. I represent one of them.
Land Resource property owners have the right to know the nature and extent of the debt that may encumber the various named projects. The United States Department of Housing and Urban Development reminds purchasers that restrictions or encumbrances on lots, or on Subdivisions, could affect titles to lots.

On August 26, 2008 a group of Grey Rock at Lake Lure property owners filed a federal lawsuit against Land Resource, LLC and associated parties. The plaintiffs allege violation of the Interstate Land Sales Full Disclosure Act. Please see Goetz et al v. Land Resource, LLC et al.

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