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Manchester borrows $295 million for Texas hotel
Pope Benedict XVI featured in U-T San Diego publisher’s China funding pitch
Doug Manchester (far right) with Pope Benedict XVI
With construction of U-T San Diego publisher Douglas Manchester's convention hotel in Austin, Texas finally underway, some details of its unusual non-bank financing have become public.
Manchester's planned Austin hotel
As previously reported here, the hotel project broke ground last month after troubled asset mogul Thomas Barrack, famous for bailing out the late pop star Michael Jackson and celebrity photographer Annie Leibovitz, announced his Colony Capital would finance the project.
"We are looking forward to yet again working with 'Papa' Doug, his son Doug and Fairmont [Hotels] in the dynamic, growing city of Austin,” U-T quoted Barrack, a University of San Diego 1972 law school grad, as saying in an October statement.
The paper provided no details regarding terms of the deal. Manchester had long struggled to find enough cash to get the project off the ground.
"As a rule, Barrack is drawn to distressed situations," according to a New York Magazine profile from October 2010.
"One of the adages in a list of 'rules for success' that he sometimes distributes to employees is 'befriend the bewildered.' And when you start applying the thought process of a vulture investor to pop culture, suddenly the world can seem dizzy with opportunity."
"The inaugural Colony transactions mined the S&L crisis by buying packages of bad loans from the FDIC at bargain prices," the magazine reported. Jackson's bizarre demise also turned out propitiously for the financier.
“What’s amazing,” Barrack told the magazine, “is he attained in death what he could never attain in life.”
According to a document filed with the Travis County recorders office in late October, a Delaware corporation by the name of ColFin Fair Austin Funding has come up with a loan of $295 million for the hotel. The address of ColFin, apparently short for Colony Financial, is listed as Barrack's tony headquarters in Santa Monica.
U-T's October story said Hunt Construction Group had received a $247 million contract to build the project.
The Manchesters with George W. Bush
The identities of any others who might have an interest have not been revealed. The original developer, Manchester Texas Financial Group, LLC has handed its ownership over to a new Delaware corporation, Manchester Austin, LLC, according to Travis County records. The chief executive of both entities is listed as Richard Gibbons, second in command of Manchester's Mission Valley-based operations.
As reported here in June 2013 by Don Bauder, the U-T publisher earlier had tried to tap money from wealthy Chinese investors through a controversial federal program allowing families to buy their way to green cards insuring permanent U.S. residency by investing $500,000 in so-called job creating projects.
A brochure pitching the project to the would-be investors called Manchester "the leading conventional hotel developer in the United States."
Doug Manchester (third from left) with Governor Arnold Schwarzenneger
Doug and Betsy Manchester with President Ford
Photos of the heavy-hitting Republican contributor standing with ex-GOP presidents Gerald Ford, George H.W. Bush, and his son George W., were included. Also featured: shots of Manchester with ex-California Republican governor and movie action hero Arnold Schwarzenegger, as well as Pope Benedict XVI.
Here's something you might be interested in.
Manchester borrows $295 million for Texas hotel
Pope Benedict XVI featured in U-T San Diego publisher’s China funding pitch
Manchester borrows $295 million for Texas hotel
Pope Benedict XVI featured in U-T San Diego publisher’s China funding pitch
Doug Manchester (far right) with Pope Benedict XVI
With construction of U-T San Diego publisher Douglas Manchester's convention hotel in Austin, Texas finally underway, some details of its unusual non-bank financing have become public.
Manchester's planned Austin hotel
As previously reported here, the hotel project broke ground last month after troubled asset mogul Thomas Barrack, famous for bailing out the late pop star Michael Jackson and celebrity photographer Annie Leibovitz, announced his Colony Capital would finance the project.
"We are looking forward to yet again working with 'Papa' Doug, his son Doug and Fairmont [Hotels] in the dynamic, growing city of Austin,” U-T quoted Barrack, a University of San Diego 1972 law school grad, as saying in an October statement.
The paper provided no details regarding terms of the deal. Manchester had long struggled to find enough cash to get the project off the ground.
"As a rule, Barrack is drawn to distressed situations," according to a New York Magazine profile from October 2010.
"One of the adages in a list of 'rules for success' that he sometimes distributes to employees is 'befriend the bewildered.' And when you start applying the thought process of a vulture investor to pop culture, suddenly the world can seem dizzy with opportunity."
"The inaugural Colony transactions mined the S&L crisis by buying packages of bad loans from the FDIC at bargain prices," the magazine reported. Jackson's bizarre demise also turned out propitiously for the financier.
“What’s amazing,” Barrack told the magazine, “is he attained in death what he could never attain in life.”
According to a document filed with the Travis County recorders office in late October, a Delaware corporation by the name of ColFin Fair Austin Funding has come up with a loan of $295 million for the hotel. The address of ColFin, apparently short for Colony Financial, is listed as Barrack's tony headquarters in Santa Monica.
U-T's October story said Hunt Construction Group had received a $247 million contract to build the project.
The Manchesters with George W. Bush
The identities of any others who might have an interest have not been revealed. The original developer, Manchester Texas Financial Group, LLC has handed its ownership over to a new Delaware corporation, Manchester Austin, LLC, according to Travis County records. The chief executive of both entities is listed as Richard Gibbons, second in command of Manchester's Mission Valley-based operations.
As reported here in June 2013 by Don Bauder, the U-T publisher earlier had tried to tap money from wealthy Chinese investors through a controversial federal program allowing families to buy their way to green cards insuring permanent U.S. residency by investing $500,000 in so-called job creating projects.
A brochure pitching the project to the would-be investors called Manchester "the leading conventional hotel developer in the United States."
Doug Manchester (third from left) with Governor Arnold Schwarzenneger
Doug and Betsy Manchester with President Ford
Photos of the heavy-hitting Republican contributor standing with ex-GOP presidents Gerald Ford, George H.W. Bush, and his son George W., were included. Also featured: shots of Manchester with ex-California Republican governor and movie action hero Arnold Schwarzenegger, as well as Pope Benedict XVI.
Comments
Manchester will love Austin. Low labor rates and no low benefits with lots of illegals to work under the table. Maybe he will sell his CA assets and move to Texass.
I seriously doubt he would ever move there.
When you look at the numbers, there doesn't seem to be a big difference: lower income is offset by a lower costs of living.
Austin's median household income is $52,431, which is slightly above the national average.
San Diego County's median household income is about $10,000 more than that, but it gets more than devoured by high housing, fuel and electric costs, among others.
The median price of homes currently listed in Austin is $340,000. The median rent in Austin is $1,450.
The median price of homes currently listed in San Diego is $509,900 The median rent in San Diego is $2,100.
Pay Mr. Clarke no mind. He likes wide-sweeping generalizations.
You and anyone else can pay me no mind as you wish. Having lived in Austin, a beautiful city, I can tell you that it is an exception to the rule. Once you get into the small cities and towns of Texas it is a different story.
Wait, Clarke, I thought your man Rickkk Perry was taking care of that???
He may be your man but not mine. Governor of Texas is a perfect job for him as the governor position has no power and is an empty suit job.
I read recently that Austin ranks as the 3rd fastest-growing city among as those that had populations of more than 500,000 at the time of the 2000 census.
Some details of this "unusual non-bank financing have become public." But the details that would tell the real story aren't public knowledge yet, and may never be. I'd guess that Dougie and company had to agree to pay above market rates for the financing, and will have little control once the hotel opens. There's an old adage that the builder of a hotel rarely makes a profit. The companion adage is that the second to own a hotel can do quite nicely. That's because they cost so much to build and equip that room rates don't cover the operating expenses and debt service. After a bankruptcy or distressed sale, the second owner, who buys it for less than it cost to build, can then realize a positive cash flow. This makes me wonder just how well Manchester has done in the past with his hotel ventures. I'd guess he usually risks OPM (other people's money) on those deals, and not his own.