The developer of The Chateau project in South Lake Tahoe, just across the state line from Nevada hotel-casinos, struck a deal to buy 3.4 acres of adjacent land and says the additional space gives it room to build the $400 million project as it originally was envisioned several years ago.
Owens Realty Mortgage Inc. of Walnut Creek said in a filing with the Securities and Exchange Commission that its wholly owned subsidiary, Tahoe Stateline Venture LLC, is buying nine parcels bordering the property it already owns at The Chateau. The development company said it expects to pay $6 million in cash to the seller, City National Bank.
Along with the land itself, Owens Realty Mortgage will be acquiring the right to develop 188 hotel, condominium or fractional-ownership units on the parcels. The property also includes space for retail and open-space development, the company said.
William Owens, president and chief executive officer of the development company, said the purchase brings his company’s total holdings to 11.5 acres. He said that’s enough to allow for construction of 477 hotel and condo units, 58,000 square feet of retail, a 19,000-square-foot spa and about 20,000 square feet of meeting space.
The plans still need to the approval of the city of South Lake Tahoe Building Services.
Last fall, the company started the construction of 30,507 square feet of retail space fronting South Lake Tahoe Boulevard next to Harveys. That contract totals $15.15 million, and the company said it has invested another $6.4 million in engineering, legal, consulting and other development-related costs on the project.
In an earlier filing with the SEC, Owens Realty Mortgage said it valued its existing landholdings at The Chateau at $30.6 million last fall. The new purchase would bring the value of the land to $36.6 million.
Owens has been painstakingly working since 2012 to assemble the land parcels at The Chateau after the original developer sought bankruptcy protection at the onset of the recession, and multiple foreclosures put the parcels into the hands of lenders.