A principal of the company that tore down North Burnaby’s Royal Canadian Legion, and reneged on promises to rebuild it, played a key role in a US$75 million deal for 618 acres of vacant land near Palm Springs.
But it does not appear that Epta Properties vice-president of finance, Alex B. Tsakumis, was left with a significant stake in the deal.
The Desert Sun newspaper in California reported March 28 that EC Rancho Mirage Holdings GP Corp. bought the trophy property, known as Section 31, at the geographical centre of Rancho Mirage.
Russell Holmes, vice-president of Clarity Real Estate, said his company led the deal for what is also known as The Eagle. It is adjacent to Sunnylands, the former estate of Walter Annenberg, who published TV Guide and Daily Racing Form in their heyday. The private resort and golf club came to be known as the “Camp David of the West” for hosting the likes of Queen Elizabeth II, Dwight Eisenhower, Ronald Reagan, Barack Obama and Xi Jinping.
Holmes said that the majority of capital for the transaction came from two New York family offices. He declined to identify them. Likewise, he declined to name the principals of Clarity, other than to say that they are also managers at Second City Capital Partners of Vancouver. Holmes said Second City chair Sam Belzberg is not affiliated with Clarity. Coincidentally, and tragically, Belzberg died March 30 in a Vancouver hospital after suffering a stroke. The private equity investor and philanthropist was 89.
The Rancho Mirage land is zoned for residential, resort hotel, commercial and retail use, but Holmes said there are no definite plans yet.
“We’re still very early in our planning and envisioning processes and we haven’t yet assembled our full, world-class team of developers and consultants,” Holmes said.
Holmes called Epta “instrumental in sourcing the acquisition, as well as forming the entity that put it under contract,” but he wouldn’t say how much, if any, equity that Tsakumis, his two brothers and father have in the deal.
“I can’t speak to the exact equity partners, but I spoke to the two New York family offices and Clarity forming the majority of the equity,” Holmes said.
Tsakumis did not respond to theBreaker’s request for an interview. He listed the address of a $2.158 million-assessed house in West Vancouver’s Eagle Harbour neighbourhood on the Nov. 30, 2017 California corporate registration. The form said EC Rancho Mirage Holdings GP was incorporated last May 2 in Delaware.
His cousin is a former media commentator who emphatically denied any connection with Epta. Last November, Trigate Properties CEO Alex G. Tsakumis said his company has no overlapping interests or directors with Epta.
“We have never had anything to do with Epta Properties, and we will never have anything to do with Epta Properties — ever, period,” said Alex G. Tsakumis.
Last November, theBreaker reported that Epta was negotiating for prime land in Greater Palm Springs. At the time, CBRE listing agent Jeff Woolson would only say the land was under contract. Woolson was the broker for sellers Stark RM Eagle LLC and Difference RM Properties LLC. He referred theBreaker to Holmes.
Epta has been a party in more than 40 court actions in British Columbia and it never put a shovel in the ground to rebuild the Branch 148 Legion Hall in North Burnaby after demolishing the 1955-built social venue for war veterans. It vowed in 2013 to build a new Legion canteen within the mixed-use Centro, with two dozen condos, by fall 2015. Epta paid the Legion’s $145,000 tax bill for 2014. It took out a $3.1 million loan, but claimed $2.82 million in costs, including a $700,000 “development management fee.”
Instead of suing Epta or giving it more time to begin construction, members of the cash-strapped Legion voted to sell the property to Beedie Development Corp., even if that meant the canteen plan would fall by the wayside. The site remains vacant.
Epta’s related company, Apollo, started as a wine importer and became a major cranberry grower for giant Ocean Spray. Court filings show that, over a seven-year period, Apollo advanced $5.9 million from its cranberry farming cashflow to related parties, “with the majority of the advances made to Epta Properties Ltd.”
Apollo was in default to Farm Credit Canada in January 2015 when it owed $23.626 million to secured creditors, primarily Farm Credit ($17.3 million) and First West ($4 million). In July 2015, Apollo reached a deal to sell the land, buildings, equipment, permits and contracts to D.R. Barnston Holdings Ltd. for $24.875 million, with a Feb. 11, 2016 closing date.
Support theBreaker.news for as low as $2 a month on Patreon. Find out how. Click here.