About a third of East Ashland, a 300-acre development adjacent to Interstate 95, is going back to the bank as its owner, developer Hank Wilton, continues to work his way through Chapter 11 bankruptcy.
East Ashland was a plan for and might still one day be a colossal town-center-type of development with retail, single- and multi-family residences, offices, plazas and plenty of greenery. The plan even called for a hotel.
But the development, like Wilton, got caught in the real estate downturn.
According to a foreclosure notice this week, Ashland Properties LLC, an entity connected to Wilton, owes money on about 100 acres at East Ashland, which is bordered by East Patrick Henry Road and Mount Hermon Road.
“Wachovia is foreclosing on their part,” Wilton said Tuesday. “There’s about $7 million in debt on it. They’ll probably resell it to another developer.”
The bank wasn’t willing to renew the loan on his portion of the development, Wilton said.
“It’s waiting for commercial development to start again,” Wilton said. “Number one, you can’t get any financing. Second, all the people we need to see going in, a Target or an anchor tenant, they’re not in the market yet.”
As was the case with many of his past developments and a main trigger for his bankruptcy filing, Wilton personally guaranteed the loans on East Ashland.
Wilton filed for Chapter 11 protection in September, owing about $70 million to banks all over town. (You can read more about his bankruptcy in an RBS story here.)
Wilton has told BizSense that he got caught in the downturn with too much land. He says he is still working with his lenders to straighten things out.
Wilton’s share of East Ashland will be auctioned at the Hanover County Circuit Court on March 25.
East Ashland’s planned sprawl caused a controversy in that part of town.
Nora Amos, the director of planning and community development for the town of Ashland, said that Wilton first proposed the project eight years ago.
Getting the green light for the various types of zoning took years. Residents also fought the project and the potential traffic.
“There was a lot of study on the impacts of the traffic,” she said.
The foreclosure, however, does not mark the end of East Ashland.
The Ashland town council will hear a proposal this week related to a small subdivision proposed for the East Ashland site, Amos said.
And the bank on Wilton’s side of the property has asked for an extension to submit a site plan to keep the project open for other potential developers.
Wilton said the project will live on.
“The plan is still in place,” Wilton said. “The proffers are still good. The taxes have been paid on it.”
According to Wilton, the other half of East Ashland is owned by some of his former business partners. Essex Bank is the lender on that side of the development, he said.
“The other guys hopefully will do something with the Hanover property,” he said.
“It’s waiting for the economy. It’ll have its time and place.”
Michael Schwartz is a BizSense reporter. Please send news tips to [email protected].
About a third of East Ashland, a 300-acre development adjacent to Interstate 95, is going back to the bank as its owner, developer Hank Wilton, continues to work his way through Chapter 11 bankruptcy.
East Ashland was a plan for and might still one day be a colossal town-center-type of development with retail, single- and multi-family residences, offices, plazas and plenty of greenery. The plan even called for a hotel.
But the development, like Wilton, got caught in the real estate downturn.
According to a foreclosure notice this week, Ashland Properties LLC, an entity connected to Wilton, owes money on about 100 acres at East Ashland, which is bordered by East Patrick Henry Road and Mount Hermon Road.
“Wachovia is foreclosing on their part,” Wilton said Tuesday. “There’s about $7 million in debt on it. They’ll probably resell it to another developer.”
The bank wasn’t willing to renew the loan on his portion of the development, Wilton said.
“It’s waiting for commercial development to start again,” Wilton said. “Number one, you can’t get any financing. Second, all the people we need to see going in, a Target or an anchor tenant, they’re not in the market yet.”
As was the case with many of his past developments and a main trigger for his bankruptcy filing, Wilton personally guaranteed the loans on East Ashland.
Wilton filed for Chapter 11 protection in September, owing about $70 million to banks all over town. (You can read more about his bankruptcy in an RBS story here.)
Wilton has told BizSense that he got caught in the downturn with too much land. He says he is still working with his lenders to straighten things out.
Wilton’s share of East Ashland will be auctioned at the Hanover County Circuit Court on March 25.
East Ashland’s planned sprawl caused a controversy in that part of town.
Nora Amos, the director of planning and community development for the town of Ashland, said that Wilton first proposed the project eight years ago.
Getting the green light for the various types of zoning took years. Residents also fought the project and the potential traffic.
“There was a lot of study on the impacts of the traffic,” she said.
The foreclosure, however, does not mark the end of East Ashland.
The Ashland town council will hear a proposal this week related to a small subdivision proposed for the East Ashland site, Amos said.
And the bank on Wilton’s side of the property has asked for an extension to submit a site plan to keep the project open for other potential developers.
Wilton said the project will live on.
“The plan is still in place,” Wilton said. “The proffers are still good. The taxes have been paid on it.”
According to Wilton, the other half of East Ashland is owned by some of his former business partners. Essex Bank is the lender on that side of the development, he said.
“The other guys hopefully will do something with the Hanover property,” he said.
“It’s waiting for the economy. It’ll have its time and place.”
Michael Schwartz is a BizSense reporter. Please send news tips to [email protected].
Again, the banks. Wilton was up to date on payments and taxes for the property, but the bank — no, the Obama administration’s Treasury Department — pulled the loan. Wachovia took TARP money. That essentially means Treasury is making all decisions. Essentially, Wachovia’s loan department, like the loan departments of any bank that took TARP money, is run by the government — nationalized — even if they paid the money back with interest long ago. Wilton’s not the only one who’s lost property when he’s done everything right on the property. Yes, he’s in Chapter 11, but that doesn’t mean… Read more »
James, you should not speak about situations you do not know. You should check the Henrico tax records to see if Mr. Wilton and his entities kept the taxes paid (he didn’t, FYI). Some builders and developers just got in over their heads and people need to stop blaming the banks for everything. No one made the builders and developers apply for the loans. It’s a shame no one understands that when you sign a note, you are legally obligated to pay it back. “Just walk away” seems to be the new norm. Anyone know how many unemployed people we’d… Read more »
James, it seems to me that your comments are just sensational and not based on fact/reality. This has nothing to do with TARP or Obama. You may be right about payments on time, etc., but you’re forgetting value. I’m sure when the Bank signed up for this they were at <65-70% loan to value; now I'm sure it's well over 100%. That ratio is not good. So to correct that you pay the loan down back to 65%. You ask why? Becasue it's a RECOURCSE loan and with any land speculation there's risk and your better have the personal financial… Read more »
wow james. You are nuts. This section of your rant is just batty: “Wachovia took TARP money. That essentially means Treasury is making all decisions. Essentially, Wachovia’s loan department, like the loan departments of any bank that took TARP money, is run by the government — nationalized — even if they paid the money back with interest long ago.” Totally unfounded and untrue. Yes, banks are regulated – and we can collectively argue forever and a day as to the extent and/or efficiency thereof. They are not, however, micromanaged by some archetypal “big guvmint bureaucrat”. And why do you think… Read more »
TARP was created before Obama was even elected.
If Wachovia actually took TARP money, they would still be around and not been taken over by Wells Fargo. Unfortunately for them TARP didn’t exist at the of their problems.
Gosh Ashland is so pretty, perhaps this is a call to count our blessings. Can’t people go to Target at VCC? Why can’t the tides turn where there is not one ugly strip mall after another. I understand putting people to work. We could do it the old fashioned way and be more supportive of our small businesses who would in turn find a need to do hiring of their own. Our local economy is not so desparate that we must develope every square foot of our beautiful land in the great Commonwealth of Virginia!!!
I WISH the government was against ugly developments. But a look at the ugly piece of cheap vinyl siding and fake brick fronts that is Glen Allen shows there is nothing happening to stop them.
Anyone can get an already built poorly built house for cheap – no real need for new ones. Look at the numbers on new home sales