Bankrupt Marina Builder Announces New Alliance : Real estate: Court must approve Abraham Lurie’s deal with an influential developer as he attempts to fend off Saudi partner’s bid for control of the properties.
In a bold move to maintain control of a crippled Marina del Rey real estate empire, the marina’s biggest developer Tuesday disclosed plans to join forces with a prominent Los Angeles builder.
The new partnership of bankrupt developer Abraham M. Lurie and politically influential builder Jona Goldrich would give the team control of nearly a quarter of the publicly owned marina, worth at least $200 million.
First, however, the deal must make it through federal bankruptcy court, where it faces stiff opposition from Lurie’s current partner and from a number of banks. Ultimately, the fate of the marina properties will be decided by U. S. Bankruptcy Judge Calvin K. Ashland and the creditors.
A major contributor to local, state and federal political campaigns, Goldrich will assist Lurie in fending off efforts by Lurie’s partner, billionaire Saudi Arabian businessman Abdul Aziz al Ibrahim, to win control over three hotels, two apartment complexes, offices, shops and more than 1,100 boat slips at the marina.
Lurie and Ibrahim are battling for control of about 20% of the marina. The fight is being closely watched by Los Angeles County, which owns the marina and leases it to private developers, and by a handful of banks that are owed more than $140 million on the marina properties.
Weakened by heavy borrowing and drained by years of fighting with Ibrahim, the bankrupt Lurie needed a partner with financial clout. In a bankruptcy reorganization plan filed last month, Lurie said a Los Angeles investment group was willing to pump $5 million into his marina enterprises.
Pressed to name the unidentified investors, Lurie’s attorney, Jeffrey H. Greenberg, told the crowded bankruptcy court: “Jona Goldrich is going to support Mr. Lurie’s plan.” Later, Greenberg said Goldrich is “the primary backer” of Lurie’s investment group, but “there are some others.” Neither he nor Lurie would name them.
Three years ago, Lurie sold a 49.9% stake in his marina holdings to an unnamed Saudi sheik in a deal structured through shell companies in Europe, the Caribbean and California. The Times later identified the lead investor as Ibrahim, brother-in-law of King Fahd, who has extensive real estate investments in Europe, the Middle East and the United States.
Their partnership quickly deteriorated and both sides are seeking to sever their ties in bankruptcy court. Lurie had been looking for a new investor.
Goldrich has operated a waterfront apartment and marina complex called Dolphin Marina for many years. His holdings amount to about 5% of the marina.
Last April, a divided Los Angeles County Board of Supervisors approved a precedent-setting extension of Goldrich’s lease on Dolphin Marina until 2062. Supervisor Gloria Molina vigorously objected to an agreement that would last beyond the middle of the next century.
Two real estate experts who analyzed the proposed extension for The Times said the county was charging less than full market value for control of the prime waterfront land. They also said the lengthy lease extension was tantamount to selling the property.
Despite the criticism, Goldrich won the backing of four supervisors. Board Chairman Deane Dana said the lease extension would correct problems in the original marina leases signed in the 1960s and increase the county’s income by encouraging Goldrich to build luxury apartments and senior citizen housing on the property.
Goldrich could not be reached for comment Tuesday. The Culver City-based developer is a major builder of residential and commercial projects throughout California, including housing for senior citizens and low-income families. He also is a major partner in the $400-million Channel Gateway project, just outside the marina.
For years, Goldrich has been active in politics and Jewish community affairs. In an earlier interview, Goldrich said his donations give him access to public officials. “Otherwise, you’re just another number,” he said.
Goldrich’s potential involvement in Lurie’s properties drew a cautious reaction from Ted Reed, director of the county Department of Beaches and Harbors, which oversees the marina. “Jona is a highly regarded developer,” Reed said. “It shows Abe has attracted someone of substance.’
But Reed said more than one supervisor has expressed concern about the danger of concentrating too large a share of the marina in the hands of a single developer group.
Ashland set another hearing for Aug. 28 on the adequacy of documents detailing each side’s bankruptcy reorganization plans.
