KVIG Informative

Southern Nevada is still arguing over who gets to build what in the desert and how much water it’s allowed to use doing it. One of the region’s biggest bets on both questions at once was a 320-acre lake dammed into existence in the Las Vegas Wash, financed on debt that eventually buried the project that built it.

The paper trail starts in 1988. A limited partnership called Transneva was already circulating a forecast statement for what records describe as the “Lake at Las Vegas joint venture,” according to documents held in the Thomas L. Morgan Real Estate Development Records at UNLV Special Collections and Archives. By 1989 and 1990, Transneva had a borrowing agreement with Wells Fargo Realty Advisors Funding Incorporated, later amended in a June 1990 modification agreement, the same UNLV collection shows.

Robert “Bob” Campbell, who worked on developing the project from about 1989 to 1997, said in a 2017-2018 oral history interview with UNLV’s Oral History Research Center that it was an arm of the Bass family of Fort Worth, Texas, run day to day under Ronald Boeddeker of Transcontinental Properties, based in Santa Barbara, California, with Alton Jones serving as Boeddeker’s appointee on the ground, according to UNLV’s own description of the interview, part of its Building Las Vegas Oral History Project.

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Building an artificial lake in the Mojave Desert meant answering for its water before the first shovel of earth moved. UNLV’s records show the project commissioned a water conservation report from the landscape and planning firm Eckbo, Dean, Austin and Williams dated March 5, 1990 — the same month its joint venture finalized an on-site sanitary sewer master plan. The earthen dam that would impound the lake across the Las Vegas Wash was commissioned in 1991, stands 133 feet high and runs 4,208 feet long, creating a 320-acre reservoir with normal storage just under 10,000 acre-feet, according to dam specifications catalogued in the federal National Inventory of Dams. By 1991, prospectus materials were marketing the development as “Southshore, Lake Las Vegas” and the “Lake Las Vegas Resort,” according to the same UNLV collection.

The debt that eventually sank the project built up over the following decade and a half. Lake at Las Vegas Joint Venture LLC carried a $435 million first-lien credit agreement and a $125 million second-lien agreement dated Nov. 1, 2004, then borrowed another $135 million in May 2005, before refinancing into a $540 million amended and restated credit agreement on June 22, 2007, according to a complaint the development’s unsecured creditors committee filed in 2009 in U.S. Bankruptcy Court for the District of Nevada. The same complaint alleges that lender Credit Suisse took equity control of the project through a strict foreclosure on Jan. 2, 2008, transferring it to an entity called Atalon Holdco LLC — allegations made in litigation, not findings of fact.

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Lake at Las Vegas Joint Venture LLC and four related entities filed for Chapter 11 bankruptcy protection on July 17, 2008, in the U.S. Bankruptcy Court for the District of Nevada, with Bankruptcy Judge Linda Riegle overseeing a case that listed debts of between $500 million and $1 billion against assets of only $100 million to $500 million, according to court records in the case. More than 1,000 creditors filed claims, including Credit Suisse’s own claim for roughly $307 million, filed in the case on March 16, 2009, according to the unsecured creditors committee’s complaint.

The project emerged from Chapter 11 by the summer of 2010, with the Atalon Group — the asset manager run by Frederick Chin that had taken control of the development in January 2008 — continuing to oversee the property for its new owners, according to court filings and the company’s own statements at the time. A resort built on the idea that the desert could support a decorative lake, financed by hundreds of millions of dollars in Wall Street debt, spent two years in federal bankruptcy court before Southern Nevada’s water and credit both ran out at once. The valley is still deciding how much more of that model it can afford to repeat.