Twenty-two years have passed since Margarita Mama’s opened and closed along the Bricktown Canal, and in that time, observers have seen one ambitious redevelopment after another grab people’s attention only to fall apart.
The failures come with stories of economic hard times, fraud and a mystery buyer whose identity remains unknown. If anyone is frustrated about the struggle, it’s the owner, Gary Cotton. The building as it stands now, he said, is not the legacy he wants to have in the entertainment district.
“I just want something cool and nice for families to enjoy during the day,” Cotton said. “A lot of these people (buyers) want to tie up the seller while they drum up the investors.”
The latest proposal, an eight-story, 60-room hotel that would have required demolition of the current building, died earlier this year without any explanation as to why. The Gem Hotel project’s designer, Jose Rodriguez, was the only name attached to the hotel.
The buyers’ names were never disclosed, and Rodriguez, when last reached by The Oklahoman, would only confirm the proposal was no longer moving forward.
As with prior efforts, time and money were spent as designs were developed and submitted for approval by the Bricktown Design Review Committee.
Windows were removed from the building as the mystery buyers delved into whether they could keep the envelope of the 1945 warehouse intact and build the hotel up from within the structure.
An engineering report was then submitted to the review committee warning the warehouse, with holes in the roof and cracks in the walls and foundation, is in danger of collapse. The design review committee made the rare move to allow demolition to proceed.
Rodriguez talked of ambitious plans to acquire the Brickopolis miniature golf course to the east of the warehouse and partner with owners of the adjoining Kingman building to construct a parking garage.
More than a year was spent on the project before it died.
Cotton was the first to propose an ambitious development for the building when he bought it in 2004 for $1.95 million. Development was booming along the canal, which opened to great fanfare in 1999.
Margarita Mama’s, part of a national chain of nightclubs, opened in 2001 and closed the next year. Cotton bought the building, however, counting on an existing lease with a nightclub operator planning to open multiple concepts. The operator died and the deal fell apart.
That led Cotton to pursue plans for a $4 million redevelopment of the building. His vision expanded as he bought the empty corner lot next door, where the miniature golf course is located, and then the property on the other side of the canal where Brickopolis is now located.
Cotton commissioned ADG to draw up plans for a 12-story building with condos, parking floors and retail to be built between the Kingman Building and the canal. The plans, submitted to the design review committee in early 2008, called for a pedestrian bridge over the waterway to connect to a four-story building (on the Brickopolis site).
“I wanted to do something really special,” Cotton said. “And then i bought the property across the canal where Brickopolis is. And then it grew from a $4 million to $36 million project.”
Cotton said he was still working on plans to build the development when the national economy crashed less than year into the project.
“If the financial crisis hadn’t hit when it did, I would have been broke,” Cotton said. “I got really lucky. It stopped in time from moving forward to not go broke.”
Cotton ended the year with an auction for all his canal-side properties, including the Margarita Mama’s building. Bids came in less than what Cotton paid for the properties and the auction ended without a sale.
Potential buyers came and went over the next few years. Cotton sold the vacant properties to Chris Johnson, who built Brickopolis and the miniature golf course.
Cotton believed a deal was finally struck when he sold the building to an event center company run by Utah entrepreneur Steve Down.
Down started The Falls Event Center LLC in 2011 and already had eight locations when a deal was struck with Cotton to buy the Margarita Mama’s building for $2.15 million.
“He put $400,000 down on it,” Cotton said. “That's why i took the deal.”
The Falls project, estimated at $10 million, would have turned the warehouse into an event center with a rooftop patio that would host weddings, parties and special events.
Once again, the project had to go through Bricktown Urban Design Review and faced an obstacle with the desire to create an actual waterfall in front of the warehouse facing the canal. The schedule to start construction by summer, 2017 was delayed as the review committee hesitated to approve the waterfall.
The project might have commenced if not for an Securities and Exchange Commission investigation into how Down was spending investors’ money, lawsuits and a battle over a museum that was home to Howard Hughes' famous Spruce Goose airplane.
The investigation and lawsuits were publicized by investor J.W. Millegan and businessman Paul Peterson, who contacted reporters in each market where a Falls Event Center was operating or being developed.
The pair provided documentation on prior allegations of Down, the company's founder, being prosecuted on allegations of running Ponzi schemes.
The SEC filed suit alleging Down’s company falsely claimed the event centers were profitable as it raised more than $120 million from investors.
It took me three years to evict him,” Cotton said. “I had financed the sale.”
It was after regaining control of the property that Cotton entered into a sale contract with the mystery buyers who wanted to build the hotel.
Cotton has hired a contractor to board up the open windows on the warehouse and is looking at how best to proceed with roof repairs. At this point, Cotton is open to hearing ideas on how best to redevelop the property even if he must do it himself.
“What would work here?’ Cotton asked. “What I would most love to see is someone put an old-style arcade on the canal level. On the main level I’d put in an old west ice cream bar. On the top floor, I’d get it stripped off and maybe have a nightclub looking out at the canal. Maybe it could be an event room. It has a wonderful view to the south.”
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