On Thursday, the enormous plot of land known as The Mountain of Beverly Hills was expected to sell to the highest bidder at an auction in in Pomona.
But just as the initial $1 billion listing for the 157-acre property fizzled, the auction never took place.
Owner Secured Capital Partners, which has filed for bankruptcy protection and is tied to convicted felon Victorino Noval, refused to let their decades-long hold on one of the city’s most sparkling pieces of land slip from their grasp. At least yet.
Any interested buyers, which are believed to have included Amazon’s Jeff Bezos, would have had to cough up at least $200 million at auction to cover the debt on the property. In February, after no takers, the property was slashed from $1 billion to its current $650 million listing.
Through legal maneuvers, deed adjustments and bankruptcy filings, Secured Capital pushed the auction back to next week. Here’s how that happened:
On Monday, three days before the scheduled auction, Secured Capital transferred ownership of the property back to its previous owner, Tower Park Properties, court records show.
Tower Park, which is also controlled by Victor Noval’s family, had an open Chapter 11 bankruptcy case, and thus a reorganization plan.
That plan specified that the lender, the estate of Herbalife founder Mark Hughes, is not allowed to foreclose on the property without providing a 21-day notice.
It also specifies that the lender must prove that the borrower, Tower Park, is at risk of defaulting on the loan. But the lender — Hughes’ estate — did neither, an attorney for the Novals wrote in a legal filing.
Ronald Richards, another attorney representing Secured Capital, said he expects to have an indication from the court about how the matter will play out by next week. He also expects the auction, which was pushed to Aug. 20, “is not going to happen.”
Attorneys representing the Hughes estate did not respond to requests for comment.
The Noval family has owned The Mountain since 2004, when Hughes loaned around $190 million to fund Tower Park’s purchase. In 2016, Tower Park transferred ownership of the property — with the liens attached — to Secured Capital.
But Secured Capital has been unable to repay the debts, and on May 29, a day before the Hughes trust could foreclose on the four liens, the firm filed for bankruptcy protection. A judge denied that request roughly two months later, setting the stage for the Mountain’s foreclosure.