Editor’s Note: This story was updated on July 10.
This is the stuff of soap operas. Just a week after getting an in absentia smackdown from the Santa Barbara County supervisors, hopeful Naples developer Dilip Ram (a k a Philip Ram) turned up during the public-comment portion of this Tuesday’s hearing in Santa Maria, begging forgiveness and asking them to reconsider their unanimous vote to deny transfer of the property’s development rights from its current owners — the St. Louis–based First Bank — to him.
Explaining that preexisting travel obligations prevented him from attending last week’s discussion, Ram told the board simply, “It was my understanding that the date [for the hearing] was going to be August 20. … I am here today to let you know that we are preparing a full package [of financial information] that will show that our group is more than qualified to handle a transaction of this nature.”
The stage had been set for the unexpected “dog ate my homework” moment at last week’s board meeting when the supervisors were scheduled to vet Ram and his alleged financial backer, a prominent East Coast hedge fund named Cerberus. The goal of the hearing was to see if Ram and company had the “reputation and financial resources” to deliver on the various conditions of approval agreed upon back in 2008 when a previous incarnation of the board narrowly okayed Matt Osgood’s development dreams for Naples. As per county policy, after the transfer request was filed on June 6, the supervisors had 45 days to either approve or deny it. (The vote, it should be noted, does not necessarily prevent First Bank from selling to Ram, but it would certainly work as either a ringing endorsement or a major wet blanket for the unfolding land deal.)
However, despite nearly a month passing since the request was made, and three months after Ram met with 3rd District Supervisor Doreen Farr to discuss the various complexities of trying to develop Naples (a k a Santa Barbara Ranch), county staff had received nothing from the prospective buyers that would better illuminate their fiscal standing or history. As Dianne Black, the county’s assistant director of planning and development, told the supervisors at the outset of last week’s hearing, “We have received no information to date from Spectra America [Ram’s development company] in regard to their reputation or financial resources.”
And while Ram did little to help his cause by failing to show up or provide the necessary background documents (even his two lawyers in the room opted not to participate), several members of the public, attorneys for the Save Naples group, and a few of the supervisors had used the prolific research powers of the Internet to find out what they could about the prior dealings of Spectra America and, more importantly, its head honcho. According to public testimony and documents submitted to the supervisors, Ram and Spectra America and its previous incarnation, West Millennium, have a track record peppered with bankruptcies and lawsuits. In fact, one commenter, Jared Ficker, provided documents that indicate upward of 30 to 40 prior bankruptcies related to Ram and his various affiliated business entities.
Farr explained that she could find little evidence of Ram or Spectra having ever before taken on an intricate coastal project like Naples. Instead, based on her research, she indicated that they seemed better equipped for urban development or infill efforts or a situation where building permits were already in hand. “Santa Barbara Ranch is certainly not that,” she concluded. In the end, the supervisors — all of whom expressed various degrees of indignation at the Los Angeles–based developer’s failure to be present or at least send word as to why he was absent — voted unanimously to deny the transfer of the development rights.
Fast-forward to this week, and Ram, no doubt having heard the word from his lawyers about the supervisors’ take on things, turned up for the general Public Comment segment of the agenda to plead his case. Besides explaining he believed the item was going to be delayed until late August, he promised the board that he would deliver all the necessary paperwork to county staff by the end of this week. “We would like to come back after your summer recess to discuss the consent to transfer,” said Ram, before adding, “I sincerely apologize for last week’s meeting.”
Unfortunately for Ram, a reconsideration of last week’s vote is not that easy. As Farr explained in the wake of this Tuesday’s meeting, “The board took action last week, and that action is final.” Furthermore, if Ram still wants to have the development entitlements signed over to him, a new request to transfer must be filed with the county and that request must be initiated by First Bank. To that end, according to Farr, First Bank had made no such request as of Tuesday evening. The vote against Ram does not prevent him from actually closing escrow; it just means that, at the very least, the development rights associated with the inland portion of the approved Naples plan (which calls for more than 70 large-scale luxury homes spread across both sides of Highway 101 just south of the Dos Pueblos Ranch exit) aren’t going to be signed over to him anytime soon.
In the meantime, the board’s denial of the transfer — and whatever implications it may or may not have on the status of Ram’s escrow — has worked to push speculation into overdrive about the future of Naples and the reemergence of a reported suitor with designs on preserving much of the property. As has been heavily rumored since late last year, a group of buyers known as Freestone Capital Management — a Seattle-based, multibillion-dollar asset-management company with ties to local real estate magnate Jack Theimer — had been kicking the tires on Naples big-time and were prepared to enter an escrow of their own before getting aced out by Ram at the last minute in February.
According to Freestone CEO James Rooney, who spoke with The Santa Barbara Independent this week, that interest is still very much alive, a fact evidenced by Theimer’s presence at the recent county board hearings. With an office in Santa Barbara, Freestone, to hear Rooney tell it, has had its eye on Naples for “many, many years and knows the story well,” but its primary interest in the property, at least at this point, calls for a “heavy emphasis on preservation” and all the tax benefits that would come with it. Beyond that, Rooney couldn’t say much as he has had little to no contact with First Bank since last winter when Ram entered the picture. “We do still have a genuine interest in the property,” said Rooney. “And we think we have a unique approach to the asset. Hopefully we will get the opportunity to pursue it.”