Chanos’ land sale is ‘not a done deal’

Wednesday, Jan. 11, 2006 | 9:01 a.m.

A downtown land deal that involves Nevada Attorney General George Chanos may have more legal issues than meet the eye.

Chanos has said he and his business partners are to be paid $10 million next month for two parcels of industrial land on Western Avenue, regardless of whether the Las Vegas City Council upgrades zoning so that the buyer can build high-rise condominiums. Chanos and his partners bought the land for $2.4 million last year.

But a lawyer for the buyer said Tuesday that his clients could pull out of the land deal if the City Council turns down the rezoning request, scheduled for a vote next Wednesday.

The development group, led by Craig Katchen of Las Vegas, has paid $750,000 to Chanos and his partners in return for keeping the land off the market. Escrow is scheduled to close the week of Feb. 3.

However, Katchen's attorney, Bob Gronauer of Las Vegas, said: "At the end of the day it will be my client's option to close on the property or not. It's not a done deal." If they don't close on the property, Chanos and his partners would keep the $750,000.

Informed of Gronauer's remarks, Chanos stood by his interpretation that the contract the developer signed is a noncontingent agreement that can be enforced regardless of whatever action the City Council takes.

"My understanding is that the contract is not contingent on the zoning," Chanos said of the property, owned by Cousins Chanos LLC. "And there is no legal justification for escrow not closing."

Katchen and his partners are asking the City Council to rezone 7.8 acres along Western, southeast of Interstate 15 and Charleston Boulevard, from light industrial to general commercial. The developer is also seeking approval of a project that would include 1,236 condominium units and 62,417 square feet of office and retail space.

The developer has already made some concessions, such as replacing a planned 950-foot residential tower with two smaller buildings of 650 feet and 654 feet to accommodate overhead aircraft travel.

"The project is doable," Gronauer said. "We're excited about it and we hope to get support from the City Council."

The developer wants 3.5 acres from Chanos and his partners, who acquired the land in February. The developer is buying the remaining acreage for the project from two other owners.

The offer by the developer to buy the Chanos land occurred when he was still a private citizen with his own business law practice.

But the project grew more complex and began receiving publicity after Chanos was named attorney general by Gov. Kenny Guinn. Chanos was appointed on Oct. 31 to replace Brian Sandoval, who became a federal judge.

The following month, Chanos announced he would investigate a land deal involving the Royal Links Golf Course, developer Bill Walters and City Hall. Shortly thereafter, Chanos decided to hire a special counsel to conduct the investigation, citing his possible conflict of interest because the city is also considering the land deal that involves his property.

Steve Kanigher can be reached at 259-4075 or at steve@lasvegassun.com.