Conspiracy theories tug at Cordillera’s roots
Editor’s note: In keeping with a tradition that began with Dick Hauserman’s “Inventors of Vail” and continued with Pete Seibert’s “Vail: Triumph of a Dream,” the editors of the Vail Daily are serializing Bill Clinkenbeard’s “Cordillera, From the Ground Up,” in weekly installments each Sunday. Bill can be reached at 748-0971 or via e-mail, email@example.com.
Cordillera in its infancy was suffering cost problems that, unfortunately, seem to be a hallmark of new developments. Kensington Partners was plowing new ground and none of the partners had direct experience with projects of this nature.
Felix Posen was a commodities trader. I had developed large petrochemical projects – not real estate – and Les Shapiro had put together some smaller land deals and the Avon commercial building.
But none of us had direct experience with what we were about to embark upon – a major, new, upscale community in one of Colorado’s premier resorts. And there is plenty of evidence that even experienced real estate developers are subject to major cost problems.
There hasn’t been a major development in the Vail Valley that I know of that didn’t experience such problems. Pete Seibert’s book, “Vail, Triumph of a Dream,” and Dick Hauserman’s book, “The Inventors of Vail,” detail many of these.
The early days of a new development are painful and especially so for the inexperienced. The costs are – almost without exception – underestimated.
The new Cordillera project was also encumbered with two unique burdens. One was the location. It was 20 miles from the Vail ski slopes and shops. Beaver Creek was languishing at that time, so it didn’t count. And nobody knew what we were doing in Squaw Creek Valley unless they came to the approval hearings in Eagle, and that was yet another 20 miles away.
The second burden was that people seemed to be convinced that we were the mafia and the project was financed by “dirty money.”
Though incorrect, I can understand how those rumors got started and why some people believed them. Felix was with Marc Rich who was a fugitive from U.S. justice, truly.
“Felix was probably fronting for Marc Rich,” the rumormongers said. Also, Felix Posen was often mistaken for Victor Posner, a convicted commercial criminal out of Miami.
The truth is this: True, I was from Miami but I wasn’t then, nor am I now, a drug dealer. Felix Posen was certainly not Victor Posner. I’m not sure if Felix ever heard of Posner.
Finally, to the best of my knowledge, all of the monies that were invested in Cordillera, other than other developers and homebuilders’, were Felix Posen’s. I never had any evidence or suspected that Marc Rich, the individual, had any money in the project.
I met Marc Rich on two occasions but we never discussed Cordillera. In fact, if it wasn’t a commodities deal, there was very little to discuss with Marc. To this day I have trouble convincing some people that Cordillera was a “clean money” project and the original partners were not mafia types. Conspiracists are a funny lot.
In January 1988, Felix, who had control of the partnership, decided that I should replace Les Shapiro as the managing partner. I still had some consulting commitments so I actually had to give this serious thought. However I looked at it as an exciting challenge and so agreed to take it on.
I took the news to Les at his home in Squaw Creek. He accepted it philosophically, at first. A partnership meeting was held to make the change. As the new managing partner I quickly assembled the employees and contractors and asked for their cooperation. All agreed to do so, and did.
Les apparently changed his mind and decided to fight the management change. He asked for another partnership meeting. It took place in the office of his Denver attorney. I was there in person and Jane and Felix participated by telephone.
Calling the meeting a comedy of errors would be charitable. It was rather like one of these TV commercials for cell phones. People were talking over one another. Telephone reception was poor so things were misunderstood or misinterpreted, and Les’ attorney was bringing up arcane points that were hard to decipher.
The purpose of the meeting, I guess, was either to get Les back in as the managing partner or to set the stage for a lawsuit. I read the transcript that a stenographer made of the meeting trying to make sense of what transpired that day. If you ever want to understand the true meaning of obfuscation, read that document.
A lawsuit quickly followed. Les filed for wrongful discharge against JLP Realty and Clink Inc. The usual depositions and legal maneuvering went on, but the case went to trial rather quickly. The trial was scheduled to last for two days in Eagle County.
Prior to trial, offers and counteroffers were made having to do with Les’s continuing participation, but not as managing partner. These went nowhere and the trial opened as scheduled.
After the first day in which numerous witnesses, not surprisingly, gave conflicting testimony, Judge William Jones asked us, as judges almost always do, to try and settle out of court.
I was renting a condo in Eagle-Vail at the time and our New York and local attorneys came over the evening of the first day of the trial to meet with Felix and I to develop a final strategy.
I sent out for pizza and settled in for a long night. It was clear that Les did not want to stay in the partnership, in any capacity, so our evening discussions centered on buy-out strategies.
The next morning, the second day of the trial, all parties met at the Eagle County Courthouse at about 8 a.m. The trial was to start at 10 a.m. The opposing parties were in separate rooms and I acted as the messenger boy, taking offers and counteroffers back and forth.
Trial time approached and there was no agreement. We all headed for the trial room and just before entering Les said, in not terribly friendly terms, he would accept the last offer Felix had made. I am not free to reveal the settlement.
Judge Jones asked if all were in agreement and when we said we were, the case was closed. Les’s shareholding passed wholly to JLP realty.
Late in the morning, after the case was settled, I went back to the Cordillera construction trailer and mused about events past, present and future. Of the four original principals, Jerry Rea, Les Shapiro, Felix and myself, there were now just two. I should have guessed then that ultimately there would be just one.