Legacy Park in Mesa could have new owners in less than 40 days now that a date for the sale of the facility has been set.
U.S. Bankruptcy Court Judge Daniel Collins, who is in charge of overseeing the bankruptcy case, approved the bid procedures to sell the park on Wednesday.
Potential buyers who want to take ownership of the 320-acre sports facility must submit by the bid deadline on Sept. 28, after which a legal team will determine the qualified bidders.
If more than one qualified bidder submits, an auction will take place on Oct. 5 at 10 a.m. in a bankruptcy courtroom in downtown Phoenix. The legal team for Legacy Cares told Judge Collins there are various interested parties and there continue to be latecomers.
The sale hearing will take place on Oct. 18 to receive final approval from the judge.
The need for speed is in part because of the limited funds still available to keep the park’s doors open.
UMB Bank had agreed to provide $9 million more in funds to keep the park operating and those funds will run out by the end of October.
A legal representative for the bondholders told the judge expectations that more money will be provided for park operations should be “tempered.” “They are not going to turn around and write more checks,” he said.
James Doak, the head of Miller Buckfire, the firm in charge of overseeing the sales procedure, said on Aug. 31 that if the park were to cease operations prior to the sale, then the value of the asset would drastically drop.
The park is expected to sell at a loss. At a previous court hearing, the highest price mentioned was $185 million. Investors who bought bonds are owed a collective $300 million.
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How was Legacy Park funded?
Legacy Park was the brainchild of Randy Miller. He got approval from The Arizona Industrial Development Authority for the first $250 million in bonds in October 2020.
Such authorities are designed to give a helping hand to developments that might struggle to find funding in the private market. Because they are issued by a government agency, investors’ earnings on them are exempt from taxes. As a result, investors are willing to accept lower interest payments, resulting in a smaller cost to develop the project.
What led to the bankruptcy case?
The park opened in January 2022 and attracted millions of visitors in the year. It was one of the busiest intersections in Mesa. But it has not made a profit, losing $1 million a month.
To add to the financial issues, at least 18 firms filed liens against the property for unpaid bills. The total tops $30 million.
Legacy Cares, which manages the park and is the nonprofit arm of the park, sought to refinance the project last November. The plan was to borrow more money to pay off the debt and reissue new tax-exempt bonds. The bondholders group declined to move forward with that plan in February.
In October 2022, Legacy Cares defaulted on its bond payments and in April filed for bankruptcy.
Reporter Richard Ruelas contributed to this article.
Reporter Maritza Dominguez covers Mesa and Gilbert and can be reached at [email protected] or 480-271-0646. Follow her on X, formerly Twitter: @maritzacdom.
