SANTAQUIN — A Las Vegas developer is betting on a $50 million project that so far seems to have been nothing but bad luck.
Summit Ridge Communities, once touted as a Silicon Valley-like industrial area built alongside rows of middle- and upper-class homes and a golf course, went into foreclosure a year ago.
Plans to turn some 2,000 acres into rows of homes with high-tech telecommuting connections to nearby offices fell apart when developers failed to obtain $18 million in financing to build roads and sewer and water lines.
"The biggest problem was that institutional lenders don't have Utah on their radar screen," said Brian Seager, the Silver State businessman driving the project. "When it was announced as a Utah project the development ran into roadblocks."
Most of the time, cities in which such developments are built use tax money as leverage to secure loans for roads and utility lines. But the amount was too large for small-but-growing Santaquin, he said.
As it turned out, investors weren't interested in buying bonds that would have provided the money to build infrastructure in Seager's development.
The city's decision not to financially support the project — or lend its credit rating to get financing — turned into a blessing for Santaquin residents, said Mark Stevenson, city project director.
But Seager isn't going to fold his hand and walk away with his losses — especially if, with a little luck, money can be made.
The dream: Finding private money to blanket more than 2,000 acres with stores, businesses, office buildings and middle- to upper-class houses.
Seager is the keeper of the dream, so to speak. He came in as a creditor when the project went into foreclosure in October 2003. He owns Summit Ridge Communities now, except for land once designated for an 18-hole golf course and clubhouse.
Still, it appears the odds are stacked against the project.
A few miles north, the Payson Business Park continues to struggle to attract business. Only a few commercial structures dot the open fields.
"I'd like to see the Payson commercial park go gangbusters," Kunz said. "That would be great for us."
"Marketing studies support the development of commercial properties," Seager said. First, however, it will take about three years before enough homes are built before to support the businesses.
City leaders are evaluating plans for 600 homes — the development's first phase. Commercial development, if everything goes according to plan, would take place between the third and sixth year.
If such projects ever take off, Santaquin's population, now about 6,400, could more than double over the next 10 to 15 years, officials say.
An engineering firm has been asked to start work on future neighborhood designs. "From the city point of view," said City Councilman Wesley B. Morgan, "that's a good thing."