Although prominent businessman David Weyrich is facing a public auction on some of his key properties Friday, the rest of his county holdings may be safe from the auction block — for now.
Foreclosure is pending on Weyrich properties held under the Martin Weyrich LLC umbrella, including the Paso Robles winery bearing his name, the luxury inn Villa Toscana, York Mountain Winery and Edna Valley’s Jack Ranch Vineyard.
If he does not produce about $20 million, creditor Transamerica Financial Life Insurance will auction the properties Friday on the steps of the San Luis Obispo County Courthouse.
Beyond this development, The Tribune has learned that Weyrich is also having trouble paying back more than $23 million he owes to another lending company, R.E. Loans, owned by the Ng family of Lafayette.
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These loans are accruing at 12 percent interest, are cross-collateralized with each other and include properties within the Martin Weyrich wine business, the Carlton Hotel in Atascadero and thousands of acres of property at Santa Ysabel Ranch in Templeton and Heritage Ranch at Nacimiento Lake, according to Barney Ng. He is a son of R.E. Loans founder Walter Ng and a former principal of the company.
Ng, who spoke to The Tribune in several interviews this past week, had been with his father’s private lending companies since 1975, but officially separated from the company Sept. 4, he said. He has no personal financial stake in the Weyrich loans but is continuing to help R.E. Loans so that they can continue “to manage their assets in an orderly way,” Ng said.
Ng attributes the split to a “difference of opinion” with the Ng family on how to handle borrowers, such as Weyrich, who have stopped making their loan payments.
Weyrich started defaulting on payments to R.E. Loans more than a year ago, Ng said. Ng’s strategy has been to let Weyrich continue to manage his properties while the economy and real estate market recover.
“There’s no market for the properties right now and foreclosing could be perceived as a devaluation of them,” Ng said. “David is willing to manage the property, and in my mind we’re better served to give him incentive to maintain them.”
Ng said Weyrich had intended to repay the money he borrowed from the development and sale of his real estate subdivisions. When the housing market collapsed, so did his ability to meet his debt, Ng said.
“Mr. Weyrich bit off more than he could chew,” Ng said. “I understand this is an unusual time. David has been affected by the illiquidity in the market, and so we need a different strategy. I want to wait and see and try to cooperate, at least for now.”
It is possible, however, that Ng’s family will choose to take another route. Ng would not speculate what that strategy would be, or whether or not the auction of Weyrich’s Martin Weyrich properties would factor into the decision.
In 2002, the Ngs formed hard-money-lending mortgage pools of private investors that had grown to more than $725 million in 2007, according to filings with the California Department of Corporations.
Some of their major investments have included the Queen Mary cruise liner, which is now a hotel and tourist draw docked in Long Beach, a casino in Nevada and a brewery in the state of Washington.