Lehman seeks developer for land in downtown LV

One of the major obstacles impeding the development of the former Union Pacific property west of downtown Las Vegas has been cleared.

Now, the new owner of the 61.5 acres -- Lehman Bros. Holdings Inc. -- will seek a developer for the property after winning a public bid in a foreclosure sale on Wednesday.

A subsidiary of Lehman Bros., PAMI Las Vegas Inc., is now the title holder of the prime land that more than 2 1/2 years ago was being heralded as the site of a domed stadium that would have seated between 80,000 and 100,000 people.

Lehman Bros. was the first lien-holder for the land, owned by Nevada Stadium Partners Inc., a subsidiary of Ply Stadium Partners, a Dallas-based company. Ply was operated by entrepreneur Paul Tanner, the former chief executive officer of Polyphase Corp., a frozen food, forestry and electronics products company.

In 1996, Tanner attempted to gain support for the stadium project, but with few commitments for events and even fewer commitments to buy the luxury boxes that were to have financed construction of the stadium, the effort failed.

Tanner's dream was to fill the domed stadium with top-calibre sports events, from game-of-the-week college football on Thursday nights to National Football League, National Basketball Association and National Hockey League exhibitions.

Tanner's plans also called for a hotel and convention center to be attached to the stadium, which also could have housed large trade shows near downtown.

Tanner fell further and further behind in payments on the property and the unpaid Clark County tax bill climbed to more than $460,000.

Tanner filed for bankruptcy in Texas in May and Lehman Bros. quickly moved to lift a stay to effect the foreclosure. The Lehman Bros. legal team had to prove the market value of the land was less than the total debt to prevail. Following an appraisal, the stay was lifted, setting the stage for the foreclosure sale and Wednesday's auction.

Lehman Bros. presented the only bid -- $47.5 million -- and an attorney from the Las Vegas law firm of Lionel, Sawyer & Collins stood by on behalf of the bidders.

Rodney Jean, the attorney representing Lehman Bros., did not say whether his client was willing to pay more if another qualified bidder had emerged. Lehman Bros. officials had suspected that no other bidder would attempt to buy the property, since cash was required to complete the sale.

The only other observer at the auction was Mike Ballard of Ballard Communications, a secondary lien-holder in the proceedings. Ballard had performed public relations services for Tanner in the early stages of the stadium proposal and was owed more than $15,000. With the sale price covering just under the total expenses of the sale and the first lien, Ballard walked away with nothing.

The only suspense in the bidding was whether Tanner would make an 11th hour effort to stop the process. Officials with Old Republic Title Co., which conducted the auction, stood by their fax machines awaiting word of any legal action or late court rulings that would have affected the sale.

But none came.

Tanner has not been available for comment since he left Polyphase late last year.

Now, the books are officially closed on Nevada Stadium Partners' association with the land and Lehman Bros. can market the property to another developer.

One prospect could be Bill Pauls, a Denver developer who has an office property in northwest Las Vegas. Pauls was negotiating with Union Pacific Railroad to acquire an adjacent 115 acres west and southwest of the Lehman Bros. land for a project to include an events center, a performing arts district and a collection of restaurants.

The uncertainty of the status of the land Tanner controlled strained negotiations between Pauls and prospective tenants. Pauls also was frustrated by Union Pacific's desire to collect cash up front for the property -- a deal estimated to be worth $120 million.

Now, with the Lehman Bros. land available, Pauls or any other qualified developer could be back in the picture for a project that could extend west from downtown near the Fremont Street Experience.

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