A company that has repeatedly claimed to have the largest stake in Wohali’s future development has taken the reins of the luxury real estate property, hoping to repay its foreign investors and find a path forward for a project that has been embroiled in lawsuits and bankruptcy proceedings for the past year.
EB5AN was the lone bidder at a formal auction last month, submitting a $65 million credit bid to the trustee overseeing Wohali’s federal bankruptcy case. The company specializes in the EB5 visa program, a tool established in the 1990s to stimulate the economy through foreign investors.
The EB5 program allows residents of other countries to easily obtain a green card if they invest $800,000 in a project and prove it created at least 10 jobs. It essentially serves as a cheaper method of funding compared to traditional lenders, like banks and private investors.
EB5AN has handled over 30 projects, sourcing potential investors, lending money to developers and administering the visa program. In 2022, the company became the primary source of funding for Wohali, entering a lending relationship with the previous owners before the golf course was completed or major construction work started on the property.
Specifically, foreign investors coordinating with EB5AN contributed almost $80 million to Wohali, leading to the company’s battle in federal court to become the beneficiaries of the property’s sale. EB5AN was ultimately the lone bidder, but only after a lengthy case involving multiple other stakeholders, including Boyden Farms — the original owner of the land — and the Utah Division of Forestry, Fire and State Lands.
EB5AN touted itself as having the experience and business acumen to stabilize the Wohali property while figuring out how to pay back its investors. This is the first time EB5AN has been a primary lender on a seemingly failed project, but the company has previously joined deals in the middle of restructuring in other bankruptcy cases.
Situations in which a project fails and is revived before becoming successful are not uncommon in Summit County, with Promontory serving as the most recognizable example along the Wasatch Back.
EB5AN is still determining what Wohali’s future will look like. The company’s leadership is focused on finishing the remainder of the bankruptcy process, including settling Wohali’s debts with other lenders, and paying back its investors before diving into other construction projects or management of the property.
However, EB5AN has contracted Troon to temporarily handle the golf course, which is expected to open this summer. EB5AN’s development team has also been on site over the past few weeks to determine what amenities and infrastructure on the site still need to be completed.
There is a chance EB5AN will sell the property to another company in the future, but only after remaining issues on the site and the project’s financial problems are resolved, as there are outstanding creditors angling for repayment through the bankruptcy process.
In court filings, EB5AN pointed out poor cash management decisions that leadership attributed to the downfall of the project and its eventual bankruptcy case. Specifically, EB5AN called out previous owners’ efforts to build the golf course before installing necessary infrastructure and creating sellable lots for homeowners.
EB5AN’s attorneys said it would have been a better approach to build the residential homes first and use the proceeds from those purchases to fund the golf course’s development, which could then sell memberships to individuals living on the property. They also decried the previous owners’ philosophy that only people who purchased a home or land on the Wohali property should be allowed to buy a golf membership.
The company doesn’t want to abandon Wohali, though, even if it ends up selling the project to another business down the line. EB5AN leadership said the company is committed to working with Coalville officials to develop and provide the product they originally approved, which will boost the city’s tax base and create additional revenue.
Wohali Land Estates, the management company spearheading the original Wohali project, declared Chapter 11 bankruptcy in August, with a reported debt between $100 million and $500 million. Lawsuits naming Wohali as a defendant had already started piling up before the bankruptcy declaration, with multiple businesses suing Wohali after it reportedly failed to pay its invoices.