Fallout continues over BLM deal for Henderson stadium complex

Would-be Henderson stadium developer Chris Milam hasn’t offered a single public word since late November when he bailed on his lofty — some said inconceivable — plan to build four professional sports venues near the M Resort.

But the Texas developer did plenty of talking in letters and emails about the project before it collapsed in acrimony, allegations of fraud and a lawsuit brought by the jilted city.

That correspondence, obtained by the Las Vegas Review-Journal under the Nevada public records law, offers a behind-the-scenes look at the sales technique Milam employed over two years in wooing city officials.

His favorite approach: Drop big names.

The records are replete with mentions of Major League Baseball Commissioner Bud Selig, Major League Soccer Commissioner Don Garber and Oakland A’s owner Lew Wolff.

Milam also told city officials the NBA’s Sacramento Kings and MLB’s Oakland A’s were prime candidates to move into his Henderson sports complex. And the NFL and NCAA would be interested in staging Thursday night football games.

And then there was the Formula One race track.

It’s unclear if Milam was an earnest, if overly optimistic, salesman or if he was spinning tall tales just to get 480 acres from the Bureau of Land Management at a discount price.

Milam paid consultants to arrange meetings with officials of sports leagues, then interpreted favorable comments as commitments, which were used to arrange more meetings, observers said.

“He would take a positive meeting and turn it into a commitment and then sell it to everyone,” said Anthony Marnell III, president of the M Resort.

Here are some highlights of Milam’s campaign, in his own words:

POSITIVE SPIN

On Nov. 28, Milam sent the city of Henderson a letter terminating their two-year-old project agreement, saying the stadium and arena complex was no longer viable.

On Nov. 29, Milam emailed Henderson Mayor Andy Hafen, holding out hope that the project could still come together.

Milam told Hafen he was still talking with the Sacramento Kings about moving the team to Henderson, to Major League Soccer (MLS) about launching an expansion team in Henderson and the Formula One Group about creating an F1 track and race event in Henderson.

“We have a great deal invested and intend to develop the site as the Las Vegas National Sports Center.

“We have been in continuing negotiations regarding the Kings since our joint meeting in New York at Goldman’s offices ... We’ve also continued discussions with the MLS for an expansion franchise in Henderson. And have opened discussion with Formula One Group regarding the development of an F1 track and the sanctioning of an F1 track for Henderson ...We view the site and project as the center of the wheel in west Henderson and want it to be a world recognized success in the areas of professional sports, building architecture and integrated mixed-use urban planning.

“We want to work with the city to put the best possible plan in place. Therefore we need, without delay, to update the master plan and put in place a successor agreement that will work for everyone. ... My hope is that if all goes well we will be in position to make several important announcements early in the 1st quarter.

“I wanted to take the time to personally assure that my vision and intent to develop a world-class professional sports center in Henderson has not changed ... I appreciate that you stood by my side in support of our efforts to bring professional sports to southern Nevada and I will make this a success for you. ... It will get done and it will be as much your success as ours.”

Kings spokesman Chris Clark said the fate of the Kings rests with an NBA owners meeting this month, when owners will decide whether a Seattle group can buy the team or if the Kings stay in Sacramento. Clark said he could not comment about Milam.

BLM TROUBLE

On Nov. 30, Milam sent a letter to Hafen in response to a city letter to the BLM accusing Milam of committing fraud by terminating the project agreement while insisting that he be allowed to buy the land from the BLM.

“In the letter to the BLM, the City Attorney’s office accused us of fraud with respect to our intentions for the property. It is not uncommon to see this word in an attempt to unwind a contract. But there is no support for this claim. Over the past four years I’ve staked my professional reputation on being able to get this project done. And I’ve taken a great deal of punishment for attempting to do what many said could not be done due to entrenched existing interests.

“I’ve spent millions of dollars on this effort in architecture, engineering, land payments and consultant fees of all type. I have dedicated the majority of my working life to it over the past four years. I’ve opened a continuous dialogue with the league offices and many team owners in the NBA, NHL, (Major League Soccer), MLB ... (as well as the NFL, NCAA and the conference tournaments).

“I introduced legislation in Carson City where the president of the MLS Mark Abbott testified in support of the effort. I attempted to site the project in two places in Clark County, on what was Wet N’ Wild and near Mandalay Bay, in the city of Las Vegas at Symphony Park, and finally in Henderson. I have flown more miles than I can count and spent more nights in hotel rooms than I care to remember.

“You and the acting City Attorney Christine Guerci-Nyhus attended meetings with me in New York with our investment bankers and specific NBA team owners, met with the MLS Commissioner Don Garber and NHL Commissioner Gary Bettman in their offices with their senior staff about this project. I took the Majority Leader of the Nevada Senate Steven Horsford and the Lt. Gov. of Nevada Brian Krolicki to meet with senior officials of the NBA at the league’s offices in New York. And so much more. All in an effort to make professional sports in Las Vegas, and this project, a reality. And the claim is that I did all of this as a ruse to be nominated to buy a piece of land? ...”

on the defensive

In May 2012, Milam emailed Ning (Shenning) Shen of CSST, the Chinese firm he identified as the project’s financier.

Milam claims CSST agreed in February 2012 to loan him $650 million for the arena project, but last May changed its position and required an anchor NBA or NHL tenant for the arena as a condition for a loan.

Milam in lawsuit papers said he could not get the Kings or the NHL Phoenix Coyotes to move, so financing collapsed. In this email, Milam tries a pep talk in asking Shenning to “do the business.”

“We need to have a call in the next few days. Yesterday went well with the Kings, but it didn’t go well for CSST. You had everyone in the room listening and universally the take-away was that the deal is not getting done with you....

“I think if we’re going to work together, you’re going to have to speed things up right now and do the deal. We’ve been talking since December and we’ve invested a great deal in our relationship. But it’s now your turn to show up and do the business or not. Currently, confidence teamwide in CSST is very low. I’d like to know how you are going to prove everyone wrong.

“We also need to understand if you’re underwriting criteria has changed with respect to having an NBA franchise. If you now need a franchise lease signed in advance of funding, then we need to discuss the interest rate. It should be more like 7 percent or 8 percent in that case.”

The meeting where “it didn’t go well for CSST” included discussions of the arena financing.

EVEN OAKLAND A’S

In an email sent March 18, 2012, to his legal consultants, Christopher Stephens and John Marchiano, and public relations contractor Lee Haney, Milam’s status report is a reach.

The developer claims he’s trying to relocate the Oakland’s A’s to Henderson while also proposing to host 14 Thursday night football games.

“As the first phase of the project, the arena is carrying the cost of the land and infrastructure and is therefore burdened with more than $60 million of investment just to make the balance of the project technically and financially workable. The arena has excellent momentum, including an initial verbal commitment of equity on Friday afternoon from Penn National Gaming which owns the M Resort. Penn is a strategic capital investor and we are very pleased to have them in the equity pool ... ”

Marnell, M Resort’s president, said there was never an equity commitment. Instead, there was simple verbal commitment to provide a high-interest loan of less than $10 million to help bridge any gap between Milam’s financing and the cost of getting the project over the finish line.

“I wouldn’t even say it was peanuts. It was budget dust,” Marnell said.

Milam was also overly optimistic about progress in landing tenants for his planned stadium or stadiums.

“(Major League Soccer) remains committed to this market and the Commissioner, president and senior staff remain ready to discuss this directly with the city. Nothing has changed since the mayor met with Commissioner Garber in New York. In addition, we are running parallel discussions with the NFL and the NCAA. With respect to the NFL and Thursday Night Football, our proposal is currently sitting with Stephen Jones (Cowboys) and Neal Glat at the League office. Further, we will soon open discussions with ESPN and the NCAA concerning hosting 14 regular season Thursday Night Football, two pre-season and two post-season, all nationally televised, cross-conference collegiate football games.

“With an MLS franchise and either NFL (or more likely NCAA) Thursday night games, ... we can launch a stadium of 50,000 fixed seats after the groundbreaking on the arena.”

And he was bullish on baseball:

“We continue to track the progress (or lack thereof) of the Las Vegas 51s work on a new ballpark to replace Cashman, and the Oakland A’s, which are for us very intertwined. We’ve had conversations with Lew Wolff regarding the purchase of the A’s but do not have Commissioner Selig’s approval for the relocation.

“Given the acceptance of the NBA, NHL and MLS commissioners of the Las Vegas market, and the long-time presence of the 51s, we believe it’s only a matter of time before the MLB league office approves the relocation of a franchise to the market. We continue to actively work the MLB to ensure this happens.”

But Wolff, through an Oakland A’s spokesman, said last week that he never talked to Milam — nor had he ever heard of him.

Wolff “has consistently said he has no interest or intention to relocate the team outside the Bay Area,’’ A’s spokesman Bob Rose said. “He has also informed us he does not recall Mr. Milam and has no recollection of any conversation with him. As for Mr. Milam speaking with the Commissioner, Mr. Wolff has no information to confirm that.”

Major League Baseball spokesman Pat Courtney said Selig first heard about Milam’s purported attempt to move the A’s to Henderson from a reporter when the Review-Journal asked about it last week.

Major League Soccer spokesman Don Courtemanche said that while the MLS has talked with Milam about his plan for a possible MLS expansion team in Nevada, “We remain focused on New York City for the next expansion team. We will continue to monitor the Las Vegas market.”

FALLOUT CONTINUES

Milam is no longer part of the BLM land deal, but the fallout from his two-year project continues:

■ The city hopes to settle this month with two Milam consultants who were named as defendants in the city’s fraud lawsuit, former BLM official Mike Ford and public relations specialist Lee Haney.

■ Milam’s Texas-based creditors, who loaned him $16 million for the sports project, are scheduled to close on the BLM land deal on May 13. They want to sell the land and recoup their loan costs, though current land use regulations limits its use.

■ The federal government is investigating the BLM land deal because Ford is a business partner of former BLM director Bob Abbey. The city alleged in court papers that Abbey used his influence to shephard the land deal and that Abbey — as Ford’s business partner — stood to make money from the trans­action. Abbey denied he was involved.

Contact reporter Alan Snel at asnel@reviewjournal.com or 702-387-5273.