The long-time developer of Talus — a La Quinta project planned to be one of the valley’s largest luxury resorts — missed a key final deadline this week to secure funding, opening the door for a new developer to take over.
Talus, formerly known as the SilverRock Resort, has faced multiple delays in recent years, as its developer, Robert Green, sought funding from lenders to move forward with the roughly $600 million project.
Plans for Talus include a Montage hotel and a Pendry hotel, as well as 29 single-family homes and 55 condominiums from the same luxury brands to be used as short-term rentals. A golf clubhouse, a large conference center and a luxury spa are also planned for the sprawling site south of 52nd Avenue.
While one golf course opened there in 2005, further plans were derailed by economic turmoil from the Great Recession and, most recently, the COVID-19 pandemic. Construction on most buildings has been paused since fall 2022.
Green, whose companies have faced default notices and a lawsuit related to Talus in recent months, was up against a June 30 deadline to gain necessary financing under a development agreement with the city. The missed deadline prompted the city to deliver another default notice against Green, marking the third issued since April.
With the lapsed deadline, a new developer is ready to enter the fray — at least for now.
Christopher George, a mortgage banker based in Northern California, confirmed this week that he is exercising his rights outlined in a memorandum of understanding between the city, Green’s company and several other stakeholders.
The agreement gives George the right — but not the obligation — to pay off all debts owed by Green to lenders and subcontractors, along with the right to restructure any other payments related to the construction of the Talus project. If he decides to take over the project, George can designate a successor developer: either an affiliate controlled by his company or a third-party partner.
“I have watched the Talus project with great interest for years,” George said in a prepared statement Monday. “I have committed the time and resources to continue my thorough review of the project in order to determine if it can be viable and finally come (in) ... to serve the La Quinta community and market.”
The statement notes that the move “is not yet a commitment to recapitalize or develop the property, but it does signal a positive step forward in the evaluation process.”
The prospective developer’s announcement also comes after a San Diego County judge ruled last week that the MOU could remain in place, despite a Talus investor’s request for an injunction as part of a lawsuit. (The remainder of that lawsuit , which accuses Green and his companies of hiding harmful information to induce the lender into investing millions, still pending as of this week.)
Talus could eventually bring millions in new revenue to the city, along with $7 million in developer impact fees while the project is built, according to financial estimates from the city. For example, 10 years out from completion, the project is expected to generate roughly $2 million annually in lodging taxes.
The report also notes the project is expected to create an estimated 1,750 temporary construction jobs, along with 465 full-time jobs at the resort.
More: Talus developer sued, accused of hiding information from investor
Prospective developer must decide soon
George, who has served as a past chairman for the Mortgage Bankers Association and is currently on the national organization's board of directors , was first introduced to the project roughly two years ago as Green was seeking additional equity investors, according to La Quinta City Manager Jon McMillen. He added he was unsure of what triggered the renewed interest but noted “an incredible amount of due diligence” by George and his team in a short period.
The MOU — which also includes SilverRock Development Company, Cypress Holdings, Poppy Bank, Montage North America, and subcontractors R.D. Olson Construction and Granite Construction — has a pair of deadlines for George to move forward with the project.
By July 31, the prospective developer must decide whether to pay off all of the project’s unpaid obligations or enter into agreements with those lenders to establish new terms for repayment. There’s also a late August deadline for George and other parties to complete the terms of the MOU.
If George decides to proceed with the project, the city would likely enter into a sixth amendment to its existing development agreement, which would be transferred from Green to the new developer. That amendment would require council approval.
Alternatively, George could decide to drop his pursuit of Talus, though it’s unclear where that decision would leave the project. McMillen declined to discuss those options, but added: “We’re always looking at the ‘what if’ scenario and ‘what’s next’ scenario.”
What happens to Green?
For now, Green remains involved as a stakeholder under the MOU, though McMillen described it as “a very limited role” that could allow him to cure the recent default notice.
“He definitely has a role with respect to what I would call kind of the handoff,” McMillen told The Desert Sun. “He has relationships and existing contracts with a large number of vendors that are integral to this project, and these vendors are outside of the security interests that may be identified within the MOU.”
Green has also faced about $2.5 million in penalties due to missed completion dates for the project that effectively raise the purchase price for nearby land that could be added on to Talus in the future. The amended development agreement has also reduced the rebates on transient occupancy tax receipts available to Green.
It’s unclear if Green could face additional penalties due to the recently missed deadline. McMillen said it’s “too early” to discuss the possibility but added: “The penalty is just the fact that he's losing this opportunity and has invested, since 2014, 10 years of his life and his company's effort into this project.”
Green, who did not respond to a request for comment, told the council over a year ago that his team has invested around $150 million into the project.
“This is 100% my responsibility. I get that, and we have a lot at stake here,” Green told the council in early 2023 . “We're not going to let it go. We're going to get it finished.”
Tom Coulter covers the cities of Palm Desert, La Quinta, Rancho Mirage and Indian Wells. Reach him at thomas.coulter@desertsun.com.
This article originally appeared on Palm Springs Desert Sun: New developer may take over Talus after missed final deadline for La Quinta project
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