Former U.S. Treasury Secretary John B. Connally spent six years assembling a real estate empire across Texas and into New Mexico, but now he's selling it bit by bit to stay afloat as the Texas economy continues to slide.
His partnership has faced one foreclosure and several lawsuits over millions of dollars in debts.
"I regret that we're having to struggle like hell just to stay even," Connally, a former Texas governor, told the Dallas Morning News in an interview published Sunday.
From 1981 to 1985, Connally and his partner, Ben F. Barnes, a former Texas lieutenant governor, borrowed heavily and built $200 million worth of office buildings, shopping centers, houses and apartments in Texas and New Mexico.
But Texas' economic boom ended with the collapse of oil and gas prices and a soft real estate market, leaving them struggling to pay, delay or refinance a debt they estimate at $170 million. At the same time, their cash flow has been cut drastically by a sharp slowdown in leasing and sales.
"It's been a hard, tough struggle," Connally struggle. "At least up to now, we've managed to scrape by. I think we'll continue to do so."
Beginning in 1981, the Austin-based Barnes-Connally Partnership built a 14-story office building in Houston, another office complex in Austin, medical office centers in McAllen and Fort Worth, condominiums on South Padre Island and in Ruidoso, N.M., and a luxury subdivision in Austin.
Barnes-Connally also built 12 apartment projects and half a dozen shopping centers across Texas.
Since January, lawsuits have been filed alleging Barnes-Connally is in default on more than $35 million in loans, the newspaper said.