Fun with DeHaven's numbers | Arkansas Blog

Wednesday, April 8, 2009

Fun with DeHaven's numbers

Posted By on Wed, Apr 8, 2009 at 9:02 AM

Did you see that story in the Democrat-Gazette this morning, in which developer Jay DeHaven claims he's invested twice the appraised value of that sod farm acreage in the Lake Maumelle watershed? The story in which he rejected an independent appraisal of the property?

Grab some salt and sprinkle it all over anything the notorious wheeler-dealer DeHaven has to say.

An independent appraisal put the value of some 800 acres at $5.4 million. DeHaven bought the land out of bankruptcy less than three years ago for $4.5 million. (Though the money may have come from outside investors, not DeHaven himself.) Land values haven't exactly skyrocketed since then, particularly in exurban, undeveloped territory many driving miles from jobs. A profit of almost a million (20 percent) would be a pretty good return in that amount of time, particularly given long-prevailing low interest rates

So how can DeHaven claim he has twice that amount invested in the property? Here's what I believe to be the explanation: He's brought in outside investors for one of his famous development schemes (Maumelle New Town anyone?). They include steelmaker Thomas Schueck, who, as a Pollution Control and Ecology Commission member, fought pollution regulations in the watershed. (The regulations could discourage development.) DeHaven also reportedly brought in some out-of-state insurance companies for this project, which now includes some additional acreage. He's believed to have sold investment shares based -- not on the value of the raw land -- but on the value of a developed subdivision. How's he spent the investors' money since bringing them in? Don't know. But you don't see a big subdivision out there, do you, with streets, drainage, utilities, etc.?

So the question would seem to be this: Can DeHaven convince the public agencies wanting to buy the land (the state just appropriated $4 million) that the Lake Maumelle Bubble is real? Should they see a developed subdivision where raw land sits and pay him accordingly? (To get to DeHaven's valuation, you have to include his purchase price, the additional money put in by investors and, probably, a hefty sum for DeHaven's "sweat equity." It takes a lot of scheming to come up with deals like this.)

DeHaven calls the independent appraisal "seriously insane." People I know say it's already overly generous. Paying DeHaven twice that amount? That, seriously, would be insane.

What's at work is a huge bluff. The public must decide to pay too much for DeHaven's land or risk his proceeding with a development that would damage Central Arkansas's water supply. The taxpayers' side of the gamble: Can DeHaven proceed without development capital in a bad real estate market?

From the ArkTimes store


Comments (3)

Showing 1-3 of 3

Add a comment

Subscribe to this thread:
Showing 1-3 of 3

Add a comment

More by Max Brantley

  • Bipartisan deal to continue subsidies Trump ended. But ...

    Everyone's reporting that Sens. Patty Murray and Lamar Alexander have struck a bipartisan deal on to continue federal subsidies for health coverage that Donald Trump cut off.
    • Oct 17, 2017
  • Tuesday: Open line, news roundup

    The open line, plus the day's news roundup.
    • Oct 17, 2017
  • James Lee Witt corrects Trump on grade for Puerto Rico relief effort

    Donald Trump twice yesterday used James Lee Witt, Bill Clinton's widely hailed FEMA director and now in the private business of assisting in disasters, as a reference on the work he's done responding to hurricanes this year. Media, particularly on the conservative end, have echoed the Trump remarks.But hold on: Witt wasn't talking about Puerto Rico.
    • Oct 17, 2017
  • More »

Readers also liked…

  • Auditor Lea caught not telling the truth

    State Auditor Andrea Lea, who began her tenure in statewide office with a degree of competence unseen in some other Republican counterparts (think Treasurer Dennis Milligan particularly), is becoming more deeply mired in a political scandal.
    • Mar 4, 2016
  • Sabin's subterfuge in the race for mayor has roots in rigged city government

    The Arkansas Democrat-Gazette reports that an ethics complaint has been filed saying that the exploratory committee Rep. Warwick Sabin created to prepare for a run for Little Rock mayor was a subterfuge to avoid the city ordinance that doesn't allow campaign fundraising to begin until five months before the November 2018 election.Of course it is.
    • Aug 10, 2017
  • Another Republican miracle-working governor

    Great piece in Washington Post on the budget crisis in Louisiana. Big tax cuts and corporate welfare will do that to a state, particularly to a state whose previous governor, Republican Bobby Jindal, refused to join the Obamacare-funded Medicaid expansion. There's a lesson there for Arkansas.
    • Mar 4, 2016

Most Shared

Most Recent Comments

  • Re: Tuesday: Open line, news roundup

    • As I remember and I could be misremembering, that the ICE raids usually took place…

    • on October 17, 2017
  • Re: Tuesday: Open line, news roundup

    • OMG--could he be any more insensitive? Trump told soldier's widow 'he knew what he signed…

    • on October 17, 2017
  • Re: The Medicaid charade explained

    • How I Got My Desired Loan Amount From A Reliable Loan Company. My name is…

    • on October 17, 2017



© 2017 Arkansas Times | 201 East Markham, Suite 200, Little Rock, AR 72201
Powered by Foundation