The Atlanta Journal Constitution has a fascinating news feature on the man behind Thomas Enterprises, the current developer in Sacramento's Railyards project: "Stan Thomas: An Atlanta developer with outsized dreams faces outsized debts" (Dec. 18). As the story recounts, his projects are in bankruptcy, he hasn't paid partners and vendors.
Last month, the wave crashed over Thomas. On Nov. 2, Thomas -- a longtime shopping center developer whose success led him into ever-larger ventures -- put three major projects into bankruptcy protection. He also narrowly averted foreclosure on The Forum Peachtree Parkway in Norcross, one of his signature retail developments.
A stake in the London property is up for sale, and about a dozen other projects, including those in Sarasota and Orlando, are virtually dead, he said Friday, until he can find new financing. Former business partners and vendors have sued Thomas for nonpayment and filed dozens of liens against him.
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While Americans loaded up on easy mortgage and credit card debt earlier this decade, Thomas and developers like him took on debt of astounding proportions.
Wachovia Bank, his main lender and now a primary creditor in the bankruptcy cases, treated him as a "tier one" customer, Thomas said.
One jumbo loan Thomas personally guaranteed was for $125 million on The Rim, a 2 million square foot destination shopping center in San Antonio. He owes $63 million on Prospect Park, a speculative retail development that was supposed to attract luxury retailers to Alpharetta. Today it consists of a half-built parking deck.
Both of those projects, along with another in Smyrna, are in Chapter 11 bankruptcy protection.
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In recent years, Thomas had graduated to mega-developments. The Rim, in San Antonio, was envisioned as a destination retail-residential center with a Bass Pro Shops and a future phase bringing several hotels and luxury condos.
Long used to spending his days arranging financing, flying lawyers and brokers to his properties in his private planes and schmoozing tenants, Thomas now deals with bankruptcy lawyers and tries to hold together what remains of his empire.
What does all this mean for Sacramento? Work on the Sacramento Railyards project has begun largely because of large injections of public money for basic infrastructure - such as building roads. A key railroad track relocation agreement has been signed. But Thomas continues to delay in signing key agreements that are needed before any work can begin on the seven historic Central Shops buildings as a public marketplace, a new Railroad Technology Museum and other cultural/entertainment venues. Thomas still has not signed on to a key land swap involving 25 acres in the northern part of the 244- acre site (where Thomas originally planned to place a Bass Pro shop).
Who truly is calling the shots? The developer? Or the developer's lenders? Sacramento probably will find out soon enough whether Thomas can still deliver.
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