Orange County developer, Matt Osgood, lost his ownership interest in Naples in a foreclosure sale on the steps of the Santa Barbara County Courthouse on May 13.

The holder of the first trust deed, First Bank, issued Osgood a pre-sale demand of $78 mil to bring the loan current. However, at the Courthouse sale the bank’s trustee started bidding at $50 mil. None of the 50 attendees took the bait and at 1:04 the foreclosure trustee closed the bidding and took title for the bank.

Osgood immediately declared that he will remain the lead manager of the 1,046 acre holding and that he reserves the right to re-purchase the land and has a first refusal should another buyer emerge. None of these claims have been verified. The Santa Barbara Independent quoted Osgood as he explained; “This really was the best possible business decision for us at this time…So much has changed [in real estate] since I first bought the property 12 years ago, this was a way for me to reduce the leverage on my investment.” This is a strange statement considering that his investment now has a value of zero.

The holder of the $18 mil second trust deed, Avalon Capital Group, had their security interest in the land wiped out at the sale. Osgood was quoted in the Santa Barbara Independent as saying; “It’s unfortunate, but that is business.”

The Naples Coalition and Surfrider (represented by EDC) will continue in the “business” of preserving the Naples property and the rest of the Gaviota Coast. We enter a new and exciting chapter with a new owner that offers the potential for a rational business-like discussion on the real value of the property and how to best achieve its highest and best use for the community. Stay tuned, it will get interesting.