March 18th, 2010 | Jeff Collins
(Lasner on Real Estate) A Florida-based timeshare developer is seeking a buyer for its 400-unit timeshare-hotel project planned for construction atop the Anaheim GardenWalk parking garage. Westgate Resorts of Orlando originally had hoped to sell the development rights for $37 million, but now will settle for whatever it can get in an online auction-type sale, said company Chief Operating Officer Mark Waltrip. Westgate has architectural drawings, utilities and parking, as well as the air rights to build above the parking garage at the mall, located on Katella Avenue just east of the Disney resort. The developer had planned to begin construction by last year, but was delayed by the sour economy and a lack of financing, Waltrip said. Now, Westgate is selling the development rights off, along with more than 70 other properties across the country. We’re just selling off non-core assets that don’t pertain to our timeshare business,” Waltrip said. “We’re not in the business of holding real estate.”
Disney’s timeshares, the Disney Vacation Club, opened at the Grand Californian Hotel in September. The Westgate timeshare-hotel project is part of The Shops at Anaheim GardenWalk, a troubled mall that has defaulted on its $210 millon loan and faces a foreclosure sale on April 8. Despite the foreclosure, construction is set to begin next year on two luxury hotels next to the mall. Waltrip said the sale of his project has nothing to do with either the hotel construction or the mall’s foreclosure. Since the project has received all its approvals, development of the timeshare-hotel project could start tomorrow, he said. Westgate first listed the project, described by Waltrip as a resort-condo-hotel-timeshare development, for $37 million in October. Then they switched to an online auction by The Carlton Group earlier this month. Current interest expressed by buyers has been in the $20 million to $25 million range, representing a significant loss to Westgate. Waltrip wouldn’t say how much Westgate’s costs are, but he said that a $37 million sale would represent a very small profit. “Whatever comes in, that’s what we’ll end up selling it for,” he said.