Vo company files for bankruptcy

LACEY - A plan to eventually develop nearly 340 acres of rural Hawks Prairie into a massive mixed-use project known as Lacey Gateway Town Center is in doubt after the property owner filed Chapter 11 bankruptcy this month in the U.S. bankruptcy court for the Western District of Washington.

Seeking protection from creditors is Hawks Prairie Investment LLC, a company managed by prominent South Sound developer Tri Vo. Vo had sought to develop Lacey Gateway on property north of Interstate 5 near the outdoors equipment retailer Cabela’s, but little has happened on the property since the store opened.

The filing shows Hawks Prairie Investment has $89 million in assets – the value of 337 acres of undeveloped land – and $44.7 million in liabilities, most of which is owed to HomeStreet Bank. Creditors holding large secured claims against the company include HomeStreet Bank at $18.5 million, Thurston County at $702,000 in unpaid property taxes, and the City of Lacey for $485,000 in local improvement district taxes.

Hawks Prairie Investment also hasn’t earned any income in the past year, and the only personal property listed with a known value is a checking account in the amount of $70.73, according to the filing. A Chapter 11 filing typically means the owner seeks to restructure debts and remain in business and in control of the business.

Vo could not be reached Saturday, but Lacey community development director Rick Walk said Saturday that the last time he spoke with Vo, “he still wanted to achieve the original vision and move forward.”

At one time, Vo was developing or had plans to develop residential and mixed-use projects throughout the county. Lacey Gateway likely was his best-known project, followed by Larida Passage on downtown Olympia’s isthmus and Bellatorre, a mixed-use building project proposed in Tumwater along Capitol Boulevard.

Vo’s fortunes likely have been curtailed by the slower economy. Residential and commercial development projects have come under greater scrutiny from lenders, and the slower economy has prevented businesses from leasing or buying more space. It’s not just Vo’s projects that have been slowed by the economy; the former Olympia brewery in Tumwater remains vacant, and the same goes for Viewpoint Tower, the nine-story building that overlooks Capitol Lake. But Vo’s exposure to the slower economy might have been greater than other developers because a number of his proposed projects appear to be unraveling.

On the day that Hawks Prairie Investment filed for bankruptcy protection, South Sound Bank of Olympia foreclosed on the 42-acre site in Tumwater that was to become Bellatorre. The bank, which is owed about $3.8 million, is now trying to sell the property to a developer, and bank officials plan to meet with Tumwater officials next week to discuss the property. The proposed site for Larida Passage also is behind on its property taxes, and late last year The Olympian reported that seven of Vo’s residential developments were headed to the auction block. Trails End Arena, an indoor horse arena in Tumwater owned by another of Vo’s companies, was closed this year as the developer sought to cut expenses.

Still, in May, Vo or those working for him attended a Thurston County presubmission conference to get feedback on a 182-unit multifamily residential development in Lacey’s urban growth area. Although there was a presubmission conference, Vo does not own the property and the county has yet to receive a land-use application, said Cliff Moore, Thurston County’s director of resource stewardship.

Moore also said that Vo received preliminary plat approval from the county for a 328-unit residential development called Rancho Serino in December 2006.

“It is our understanding that this property has reverted to Sterling Savings Bank,” Moore said.

Rolf Boone: 360-754-5403 rboone@theolympian.com www.theolympian.com/bizblog