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Paradise Ranch remains mired in bankruptcy proceedings

I read much about what was printed a few years ago about the Paradise Ranch development near Merlin. What has become of the project?

— Howard F., Rogue River

Many have dreamed about turning Paradise Ranch off Monument Drive near North Valley High School into a destination resort, complete with golf course, tennis and other amenities.

Alas, the simple element known as working capital has proven to be a barrier that a series of developers have failed to penetrate with success for 30 years.

Sequoia Partners, led by Daniel Charbonneau, filed for Chapter 11 protection in December of 2010 and the matter still is pending before U.S. Bankruptcy Court in Eugene. According to court documents, liabilities now exceed $46 million.

Mark Illsley, a commercial real estate broker who was working with the developers and is now a consultant with the court, said the project had half of its funding in place but ran aground when the recession halted lending.

"The recession impacted a lot of destination golf courses, which lost about 50 percent of their value around the United States," Illsley said.

He cited a development adjacent to Running Y Golf Course in Klamath County, where lot prices fell from an average of $190,000 to $15,000 to $20,000 for fully developed lots.

In its proposed plan, Sequoia Partners asked to sell residential lots piecemeal to satisfy its debtors and go forward with other elements of its efforts. But there are still months of court-grind before the matter is settled.

"Once the courts come up with a settlement between the developer and lender, we could started seeing improvements very soon," Illsley said. "I think they're about 75 percent through the process."

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