Diablo Grande developer buys additional parcels, reshaping vision for community

World International LLC paid almost $500,000 at Thursday’s county delinquent tax sale auction to buy 20 of the original parcels at the troubled Diablo Grande community.

It was a signal the developer has continued interest in reshaping the vision for the golf-centered community in western Stanislaus County. Diane Gaynor, a spokeswoman for the community development team, said the parcels were not part of the bankruptcy court portfolio purchased by World International in 2008.

Two golf courses bordered by homes were built at Diablo Grande in the hills west of Patterson before the recession stalled the ambitious project and the original developers sought bankruptcy protection in March 2008. World purchased the resort for $20 million a few months later.

World, a partner with Laurus Corp., decided to buy the additional acreage Thursday based on an upswing in the real estate market and the bargain price for the land, Gaynor said. It paid the minimum bid amounts, ranging from $16,300 to $20,100, for the residential parcels on Legends Drive and Morning Dew Court. It also bought an 18-acre parcel for the minimum bid price of $176,400.

Eight of the Diablo Grande parcels were formerly owned by Kitco Holdings LLC, which paid $1 million for the foreclosed lots in May 2010. The other parcels, including the 18 acres, were previously owned by RWHS Diablo Grande Legends LLC.

Gaynor said the county auctioned the land to recover the delinquent taxes. She said she wasn’t prepared to make any statements on what would be developed on the property, including the 18 acres designated for multifamily residential.

World has started to research what land uses still work within the county approvals for Diablo Grande and whether newer trends in home styles and amenities could be incorporated in plans, Gaynor said. As an example, the developer is looking at carving more trails for community residents.

The developers told residents about the research effort in a mailer several weeks ago. Surveying and aerial photography have been done to produce a map for land-use planning and engineering. “Armed with this information, we’ll be able to upgrade services and select the ideal locations for a number of new planned amenities,” the letter said.

The Stanislaus County treasurer-tax collector holds the auctions to recover unpaid property taxes and other costs, such as cleanup expenses. The county board chambers were half-filled with potential buyers for Thursday’s auction featuring a list of 67 abandoned parcels.

Another item of public interest was the former Indalex Inc. site on North Star Way, just north of Modesto. In 2011, scavengers openly were trespassing on the property and using torches to cut apart the former aluminum plant for metal recycling. The facility closed in July 2008 and the owner filed for bankruptcy in 2009.

The county made its first try Thursday to sell the 9-acre parcel to recover unpaid taxes and cleanup costs, but no one bid on the property. The minimum bid was set at $474,500 and county assistant treasure-tax collector Jegan Raja disclosed that the site was contaminated to an unknown extent.

In late 2011, a Superior Court judge signed an abatement warrant letting the county clear debris. Court documents supporting the court order showed that a cancer-causing toxin, trichloroethylene, was found in groundwater under the plant before it closed six years ago. There also was an August 2010 storage tank leak near the northern parking lot at Indalex that prompted a cleanup by federal and state agencies.

Treasurer-Tax Collector Gordon Ford said the bid price for the Indalex property could be lowered for a future auction, even though the full amount owed to the county would not be recovered.

This story was originally published November 13, 2014 at 8:00 PM with the headline "Diablo Grande developer buys additional parcels, reshaping vision for community."