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Melvyn Bell update.

Melvyn Bell Update

More info has surfaced regarding Melvyn Bell's troubled real estate development in west Little Rock (Arkansas Business Sept. 24, 1990).

Insiders say Bell's efforts to restructure the funding for the $6.72-million Carriage Creek Improvement District has reached an impasse.

Bell had hoped to overcome cash problems caused by poor lot sales in the 166-acre project through a second bond issue. Negotiations reached a standstill two weeks ago in a private placement effort.

The sticking point concerned how much property the would-be bondholders desired and how much property Bell was willing to put on the line.

Bell was trying to deal with an unidentified out-of-state concern working with an equally veiled local developer. This combo required that Bell put up all unsold land in the Carriage Creek, Bell Pointe and Pleasant Heights subdivisions, plus 230 undeveloped acres adjoining to the west.

"He may think this is subject to negotiation, but it's not," one insider states emphatically.

For those who tuned in late, the bond issue used to finance the streets and other improvements in the three subdivisions has been in technical default for months now.

Bell, through his Darbe Development Co., is in arrears on his special improvement assessments to the tune of nearly $1 million at last count.

The next semi-annual bond payment is due Feb. 1, and the trustee has already had to dip into the debt service reserve fund to cover a $300,000 shortfall earlier this year.

Bell has requested a meeting with the existing bondholders, but at last report, it's uncertain whether that will happen.

Why would someone risk helping Bell out of his jam you might ask?

The would-be bondholders for the second go-around are interested in owning Bell's land and are betting on the come that he won't be able to make a go of it, even after the refinancing.

That's why they want all of Darbe Development's west Little Rock land escrowed as collateral.
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Title Annotation:Whispers
Publication:Arkansas Business
Date:Oct 22, 1990
Words:325
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