The Quarry Has a New Owner

According to an article by Julia Scott, the Quarry has been sold to an "unidentified affiliate of Ambit Funding LLC", the company that originally loaned Peebles Corp. money to purchase the property.

There were two interesting points in the article. First:

Peebles Corp. Senior Vice President Daniel Grimm would not discuss the particulars of the loan his company received from Ambit, but said it put the quarry up for sale in March 2009 to settle a previously undisclosed dispute over the terms of the loan from Ambit.

This refutes the claim that the City of Pacifica drove Peebles Corp. out of town, which has been put forth by many of the company's supporters. In fact, Peebles Corp. chose to sell the property because its loan was due, not because of anything the City did or did not do.

The second point was about the company's asking price:

Unfortunately, Rockaway Quarry was not a hot ticket among commercial developers in the sliding economy. Grimm said it had three or four offers, all of which were far below the $25 million his company was seeking. The quarry was most recently appraised at $85 million. "We were unable to sell it for a price to satisfy both parties, so we had to have another discussion," Grimm said. "We reverted back to our positions, which was a dispute, and agreed to sell it to an affiliate of the lender. ... I know they gave us a good deal, so we took it."

$25 million would have covered the original $16 million loan and provided a modest return to the company. But it's not surprising that there would be no takers at that price. In The Peebles Principles, R. Donahue Peebles says that he was originally considered offering "between $18 million and $20 million" to acquire the property (he eventually bought it for $7.5M), and one proposed financing deal called for valuing the property at a similar amount.

At best, the market value for the property in 1995 was around $20 million, but given the state of the economy and the failed Measure L campaign, it was unreasonable to expect a buyer to pay the company's asking price. (This also raises the question of how anyone could have appraised the property for $85 million.)

Representatives from Ambit have met with City officials and toured the property, but have not made any statements about its future plans.