WARWICK   07/23/2002

Rocky Pt. bidder may be chosen in 2 months
By JENNETTE BARNES

In the end, Rocky Point is likely to go to the highest bidder.

Attorney Andrew Richardson, bankruptcy trustee for the 124-acre former amusement park, hopes to choose a bid within 30-45 days to present the offer to the Bankruptcy Court. But before any proposed sale could take place, over 100 potential buyers who have expressed interest in the waterfront property will receive notice of the offer and have the opportunity to step in with higher bids.

“There’s a very strong possibility that in the end there will be a competitive bidding process, probably an auction. So the initial price is not necessarily the final price on the property,” Richardson said.

The auction may force the two Rhode Island developers who collaborated in a $6 million offer on the property with the New York firm Leyland Development LLC to make a new offer. Michael Integlia & Company, former owner of Sea View Country Club, and Hugh Fisher of Warwick would join Leyland to create a planned community with over 300 homes and apartments. Their plan is to cluster the development and leave some of the land as open space using funds from the Trust for Public Land. The trust, a national non-profit conservation group, would raise about $3 million, largely through public grants, to allow the developers to set aside about 25 acres for open space. The land would later be deeded to a public entity, probably the City of Warwick, according to Andrew McLeod of the Trust for Public Land.

Along with the other Rocky Point creditors, the city is owed over $1 million in back taxes.

Although the developers announced their plans in June at the Rocky Point gate with the support of Congressman James Langevin, they are by no means the only bidder.

“They’re just one of the groups that we’re talking to,” said the bankruptcy trustee. He plans to present the best offer to the court.

Richardson can’t go directly to the Bankruptcy Court with an offer, however. The U.S. Small Business Administration is a creditor of C.R. Amusements, LLC, which owns Rocky Point. Richardson needs approval from federal District Court, where the SBA obtained a stay of the Bankruptcy Court proceedings, before he can move forward. In the meantime, his job is to negotiate with the bidders for the best starting offer, with the knowledge that no one would give their highest offer before the auction begins.

According to sources, a bit of a tug-of-war has taken place between Richardson and the SBA because the SBA is interested in taking control of Rocky Point and marketing it, in an effort to recover the agency’s losses.

“If the SBA chooses to try and do that, they would have to get permission to do that. We can produce a fair market value for Rocky Point,” Richardson said in response.

Bankruptcy Court set the asking price at $10 million, 40 percent higher than the lone publicized bid of $6 million.

“We’ll probably get more than that six, and probably less than that 10,” said Richardson.

Howard Kaufman, executive vice president of Leyland Development, said he met with the SBA and with Richardson recently to “touch base” about the group’s offer. He said Richardson asked them to increase their offer, but they requested a counter offer from him instead.

On Thursday, the U.S. Senate Appropriations Committee approved a spending bill that includes $1.9 million for the city to put toward preserving land at Rocky Point, regardless of whether the Trust for Public Land is involved in the winning bid. Although House approval is still required before the bill goes to the president, Jeff Neal, spokesperson for Senator Lincoln Chafee, said funding for specific projects doesn’t usually disappear once the Appropriations Committee has approved it.

The city hopes to preserve a parcel of open space and public access to the shoreline in cooperation with any developer who buys Rocky Point.