Luxury project's developer files for bankruptcy

Phinny, who personally guaranteed all of Saguaro Ranch's development loans, lists assets of about $56.7 million and liabilities of nearly $36.7 million. Some of the secured creditors include New Jersey-based Kennedy Funding, which is owed nearly $24 million, and Bank of America, which is owed roughly $4.7 million.

Phone and e-mail messages left with Phinny's bankruptcy attorney, Eric Slocum Sparks, were not returned.

Nestled in the Tortolita Mountains about 20 miles north of Downtown Tucson, Saguaro Ranch pitched itself as the most exclusive development in Southern Arizona, if not the state.

Residents enter the 1,035-acre development via a tunnel Phinny blasted through a mountain. Lots started at $1.25 million, and plans called for homes with an average price of $3.5 million.

But the housing market bottomed out just as questions arose about a public easement that cuts through the development — potentially undercutting its exclusivity. Few homes have been built; numerous lawsuits have been filed against Saguaro Ranch alleging unpaid bills and blocked public access; and a number of the development's lots, including Saguaro Ranch's office, are facing foreclosure. The development's Web site is down.

Two Rolex watches worth about a combined $20,000 and furniture worth about $60,000 are just some of the assets Phinny reported in his bankruptcy petition. He's also declared about $100,000 in art and $60,000 in firearms ranging from two 12-gauge Belgium Browning shotguns to a Colt .45 revolver, among others.

The bulk of his assets come in his ownership of Saguaro Ranch's development companies.

Phinny, the grandson of Daniel F. Gerber, founder of Gerber Products Co., reported a monthly income of about $7,500 coming from interest and dividends as well as management fees.

But he also reported monthly expenses of $26,900. Most of that, about $20,000, went toward alimony and support.

Phinny's personal Chapter 11 filing is only the latest in a series of bankruptcy filings related to Saguaro Ranch. Back in mid-February a number of Saguaro Ranch development companies filed for Chapter 11 protection.

Under Chapter 11, debtors are generally protected from legal action while they work out a plan to repay creditors.

Those filings included Saguaro Ranch Investments LLC, which has about $288 million in assets and $23.7 million in liabilities; and Saguaro Ranch Development Corp., which has about $14.7 million in assets and $38.4 million in liabilities.

At that time Sparks, Phinny's attorney, said the equity in Saguaro Ranch — worth more than $100 million — makes it an unusual bankruptcy. But debtors wouldn't put money into the project unless they had the assurance of the U.S. Bankruptcy Court that money would get repaid.

Sparks has said the various bankruptcy filings will allow the development to secure financing to complete about 130 additional lots as well as a spa, casitas, an equestrian center and hiking trails.