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?


Sign up for the Daily Update email
Favorite

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

  • Suddenly, Rutledge is interested in state's terrible landlord-tenant law

    Crocodile tears from Attorney General Leslie Rutledge on the state's terrible landlord-tenant law. Given a chance to do something meaningful about it before, however, she didn't.
    • Jul 16, 2018
  • Reports filed on casino amendment

    Initial financial reports have been filed by groups pushing a casino expansion amendment and the major financial force so far is the Quapaw tribe of Oklahoma, which is in the casino business. Another Oklahoma tribe, a gambling machine organization and a Mississippi gambling enterprise also are listed.
    • Jul 16, 2018
  • Re Trump: The Arkies say......

    Trump getting trashed for cozying up to Putin, from Fox News to John McCain. Now Arkansans are being heard from. Example from Sen. John Boozman: "Russia is not our friend."
    • Jul 16, 2018
  • More »

Readers also liked…

  • Former Arkansas Attorney General Dustin McDaniel applauds Trump's EPA choice of climate change denier Scott Pruitt

    Dustin McDaniel gives the thumbs up to a man set to dismantle EPA regulations.
    • Dec 8, 2016
  • Women's March planned in Arkansas to mark Trump inauguration

    Speaking of Donald Trump and in answer to a reader's question: There will be a women's march in Arkansas on Jan. 21, the day after inauguration, as well as the national march planned in Washington.
    • Dec 30, 2016
  • Trump immigration protest at LR: Quick and fierce

    It was not even 24 hours ago that Sophia Said, director of the Interfaith Center; City Director Kathy Webb and others decided to organize a protest today of Donald Trump's executive order that has left people from Muslim countries languishing in airports or unable to come to the US at all — people with visas, green cards,a  post-doc graduate student en route to Harvard, Google employees abroad, families. I got the message today before noon; others didn't find out until it was going on. But however folks found out, they turned out in huge numbers, more than thousand men, women and children, on the grounds of the state Capitol to listen to speakers from all faiths and many countries.
    • Jan 29, 2017

Most Viewed

Most Recent Comments

  • Re: Re Trump: The Arkies say......

    • Thanks, Cato! I think your quote bears repeating: "I have President Putin, he just said…

    • on July 16, 2018
  • Re: Re Trump: The Arkies say......

    • The state's congressional delegation has the collective backbone of a gnat. Seriously, when are they…

    • on July 16, 2018
  • Re: Re Trump: The Arkies say......

    • I think what guywhore is getting at is that Trump's long game has been imparted…

    • on July 16, 2018

Slideshows

 

© 2018 Arkansas Times | 201 East Markham, Suite 200, Little Rock, AR 72201
Powered by Foundation