Winter Park " Buyers left with partial homes, full payments
September 18, 2008
Three townhome buildings in Winter Park Ranch are the subject of another abandoned construction project associated with American Dreams Seminars, or ADS Builders Inc. of Broomfield.
Four of six units in The Hills at Winter Park Ranch are in foreclosure, with the remaining two teetering, according to county records.
One owner, Alice Antolin of Northern California, said she owes New Frontier Bank in Greeley $425,000 with interest for one side of a townhome duplex that was never completed.
The deserted, unfinished units sat empty through last winter with doors left open, a neighbor said. Garages also were built a foot and one-half too low.
Construction on the project since has been rescued by a contractor hired by the bank, which intends to finish the project.
But home buyers are stuck.
“Our good standing credit is ruined,” Antolin said.
Another Hills buyer of four units, Pramod Rustagi of San Jose, Calif., said he became connected with ADS projects through an advertisement in the real-estate listings on e-bay. The opportunity to pay a modest down payment and participate in a pre-construction project appealed to the investor, who works for a “Fortune 500” company.
He flew to Denver and checked out one of the builder’s projects in person before investing in The Hills and two other projects in Colorado.
But his and others’ construction loans have been dispersed to build buildings that are far from completed.
He says he now owes about $2 million in loans with little to show for them.
The Hills project is similar to a number of incomplete developments left in the wake of builders and their associates who are under investigation in Grand County and by the FBI. The Hills, however, is not under investigation.
Homebuyers who bought into The Hills, The Wildwood at Winter Park Ranch (an eight-unit multi-family development), sub-communities within Rocky Mountain Estates near Lake Granby, and units within Granby Ranch and several others in Colorado, are enduring similar investment woes.
“The Hills project is being completed by other contractors after ADS stopped working on it, and we have had no requests for an investigation of that project,” said Investigator Leo Piechocki of the Grand County Sheriff’s Office in an e-mail.
The Sheriff’s office is looking into possible criminal activity that occurred in-state regarding the sales of lots and incomplete construction of homes abandoned by ADS in Rocky Mountain Estates, leaving many investors with loan payments on homes that are far from complete.
“Other than the Wildwood project, where the victims are not inclined to pursue any action, we have had no complaints of criminal acts involving other in-county projects,” Piechocki said. “We have no jurisdiction over acts committed outside the county but may be able to use information related to those projects to show a pattern of criminal behavior.”
The Grand County Planning Department has highlighted unusual activity in the sale of lots in The Hills.
Michael Hawthorne is one founder of Upstreet Developments LLC, the developer of the sub-community under investigation in Rocky Mountain Estates. He is also among the defendants named with ADS owner Jim Barnett in a lawsuit filed in District Court.
Hawthorne sold some of the Hills lots to ADS after ADS had already sold them to Pramod, according to Grand County real estate transaction records. The records also indicate that at least one lot was sold between developers twice on the same day with a difference of price differential of $67,100.
A phone call to Hawthorne on Wednesday was not returned.
Since the development has been in default of the subdivision improvement agreement completion date of Oct. 31, 2006, the county has kept a letter of credit from ADS held by New Frontier Bank in the amount of $85,426. The county is not yet sure what will be done with the money.
A message left with an ADS project coordinator was returned Wednesday, but the coordinator said he had not been with the company since January and had no forwarding number for Barnett. The office phone of ADS in Broomfield has been disconnected.
“Because of possible violations of federal law, the FBI is focusing on Upstreet, not ADS,” Piechocki said.
” Tonya Bina can be reached at 887-3334 ext. 19603 or e-mail email@example.com.