January 1987: The Eastman Building at 8th and Main streets is destroyed in a fire.
November 1993: Developer Rick Peterson floats the idea for a 25-story mixed-use condominium project on the property.
May 1997: The city's urban renewal agency, Capital City Development Corp., and Peterson's Boise Tower Associates sign a development agreement.
November 2001: Groundbreaking ceremonies launch construction.
February 2003: The city revokes Peterson's building permit, citing a lack of progress.
February 2004: CCDC files a lawsuit to compel Peterson to give up the Boise Tower property.
February 2006: A judge orders Peterson and his company to surrender title to the still-undeveloped property.
March 2006: Developer Gary Rogers says his company, Charterhouse Boise Downtown Properties, has taken over the site and plans an $80 million, 25-story retail/condominium project with 150 hotel rooms to be called Boise Place.
August 2007: After defaulting on the $2.57 million loan it used to buy the site, Charterhouse says it will file for bankruptcy.
Monday: Bankruptcy Judge James D. Pappas orders Charterhouse's liquidation to raise money to pay creditors.
The McCall businessman in 1985 established Charterhouse Realty Group Ltd., which owned commercial real estate throughout the United States. But his Charterhouse Boise Downtown Properties could not get a 31-story Boise Place off the ground.
The Washington state developer spent the better part of a decade unsuccessfully trying to get the 25-story Boise Tower built. In the end, all he had to show for his efforts was a partially finished foundation. Today, the foundation hole is surrounded by a fence with murals.
The old Boise Tower pit will be auctioned off by order of a federal bankruptcy judge.
The judge Monday said the assets of developer Gary D. Rogers' Charterhouse Boise Downtown Properties should be liquidated to pay off its creditors. That ended Rogers' plan to build an office, residential and retail center there.
This is the second time plans for that site have fallen through. Charterhouse bought the site in 2006 after developer Rick Peterson's decade-long effort to build the 25-story Boise Tower resulted only in a construction hole that blights one of Downtown's busiest areas.
Bankruptcy Judge James D. Pappas said appointing a trustee to sell off Charterhouse's assets offered the best chance of generating any money to pay off what is owed to Charterhouse's secured and unsecured creditors.
Pappas conceded, however, that even after liquidating Charterhouse's assets, the chances that unsecured creditors would ever receive any money were "not very bright."
Charterhouse filed for bankruptcy protection in August 2007 after defaulting on the loan it used to buy the property at 8th and Main streets from former Boise Tower developer Rick Peterson. Charterhouse later said an outside investor would help resuscitate the project, but the company never delivered details the judge sought about the investor. With its demise assured, Charterhouse itself on Sunday filed a motion in support of liquidating the company.
Boise-based U.S. Bankruptcy Trustee Bernie Rakozy said a trustee to take control of the Boise Tower property would likely be named in the "next couple of days."
"Then he'll be in control of those assets, and they will be his to liquidate," Rakozy said.
An auction date has not been set.
Assistant U.S. Trustee David W. Newman argued for converting Charterhouse's filing under Chapter 11 of the federal bankruptcy law, which allowed for reorganization, to Chapter 7, which requires liquidation. Newman said the company had failed to adhere to requirements that it submit regular reports and fees to the Bankruptcy Court.
"Conversion is best for the case and the creditors," Newman said.
Standing in line with the unsecured creditors will be Peterson, the former Boise Tower developer. He stands to lose $7 million that Rogers' company still owes him.
Peterson sold the Boise Tower site to Charterhouse in April 2006 for $2.6 million and a personal guarantee by Rogers that he would receive another $7 million when a construction loan was obtained to build the proposed Boise Place mixed-use condo/hotel/retail and office project.
Rogers originally planned a 31-story tower that would have been Idaho's tallest building, but he scaled it back after the bankruptcy filing.
Peterson also received an option to repurchase the Boise Tower site if Charterhouse had not obtained financing within 18 months of purchasing the site. That also went out the window Monday, along with the money he was owed.
"This means that Peterson's $7 million is basically wiped out," said Timbre Wolfe, president of Boise's Alpha Lending, which had given Rogers the original loan he used to purchase the site. Alpha later sought to foreclose when Rogers defaulted on the loan, prompting Charterhouse to file for Chapter 11 bankruptcy reorganization.
Peterson's best chance of coming away with anything is to regain control of the Boise Tower site, which he could sell to try to get back some of the $7 million he owed.
If he got the site back, he would get it without the development agreement with the Capital City Development Corp., Boise's urban-renewal agency, that Peterson said had plagued him for all the years he hoped to build the Boise Tower. CCDC did not require Rogers to sign a development agreement.
An agreement would have given CCDC oversight of Boise Place.
However, Peterson would be bidding against Robert Capps Homes, a Lake Tahoe, Calif., development company that purchased the Charterhouse loan from Alpha Lending.
Capps will put up the $2.57 million note it acquired as a "credit bid" when the Downtown property goes on the block, Rakozy said. If no one tops that bid, Capps would get the property.
So Peterson would have to top that price and hope that Capps didn't up the ante by coming up with "real money," Rakozy added.
An attempt to contact Robert Capps through his attorney was unsuccessful.
Peterson, who was in the courtroom Monday, declined to comment, saying that he was there only as a "bystander." Rogers also declined to comment. Peterson may find himself in a bidding war against more than just Capps.
Wolfe said that at the time it sold Charterhouse's loan to Capps, several other parties were interested in purchasing the debt.
"I would expect there will be other buyers at the sale," Wolfe said.
Joe Estrella: 377-6465
