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A year after Albuquerque Mayor Tim Keller stood on vacant land near the city’s airport to ballyhoo a potential development deal so big officials were afraid that discussing it might “jinx” it, the deal has collapsed.
The aerospace company behind the planned Orion Center has imploded amid financial and legal trouble, killing its planned agreement to lease and develop 114.5 acres of Albuquerque Aviation Department land – a project company representatives had said could eventually employ 2,500 people.
“From day one, we were cautiously optimistic. The proposal seemed a little ‘too good to be true’ but we wanted to at least give it a shot at no risk to the City,” Keller said in a statement Friday. “After waiting 8 months for them to seal the deal, it’s time we move on.”
Company officials have not yet responded to a request for comment.
Local officials began speaking publicly about the project last year, including at a November 2020 news conference after the city’s Environmental Planning Commission approved its site plan. Keller announced then that Group Orion, a Washington, D.C.-based aerospace company with plans to map and model the Earth’s surface using a network of satellites, planned to build a massive campus near Kirtland Air Force Base. He called the proposed campus, which was slated to eventually host thousands of employees tasked with constructing and testing the satellites, “a frankly unbelievable bright spot in the midst of a pandemic.”
Though Keller cautioned that the deal was a work in progress, he frequently heralded it as a reason for optimism. By April, the Albuquerque City Council had approved a ground lease and development agreement that called on Orion’s parent company – Theia Group Inc., or TGI – to develop at least 48 acres by 2025 and the whole site within a decade.
But the company never signed the agreement – which would have triggered an initial $1 million payment – the city said in a news release Friday.
The massive center has come under scrutiny as TGI has faced lawsuits and been forced to relinquish company assets and, city officials say, failed to follow through on commitments.
In August, New York-based investment firm FCS Advisors LLC filed suit against Theia Group, alleging that the aerospace company owed approximately $289 million after failing to pay back a pair of promissory notes, according to court filings.
Court records indicate that at an October court hearing, legal counsel for Theia stated: “There is no company today. There’s no money being spent in any meaningful way.”
In November, U.S. District Judge Kevin Castel ruled that Theia Group must relinquish its assets, including a license granted by the Federal Communications Commission allowing the company to build its network of satellites, to a court-appointed third party.
In his decision, Castel wrote that Theia Group’s finances “had deteriorated quickly,” necessitating what he termed an “extraordinary remedy.”
The company “was not forthcoming with information” amid the lawsuits, the city said in its news release.
On Nov. 24, the city notified the receiver that it could not proceed with the deal given the circumstances, Sunport spokeswoman Stephanie Kitts said.
“The City understands that the appointed receiver is in the process of liquidating all of TGI’s assets and will sell the FCC license allowing the creation of a satellite network to a different entity. If the receiver or another entity expresses interest in renewing negotiations with the City to establish a facility at the … property, those options will be evaluated,” the city said in its release.
The city had not offered any economic development incentives to the company during negotiations, the release said.
Sunport spokeswoman Kitts said that the city is actively marketing the property “and has received preliminary interest” from a company she said she could not yet identify.
City Councilor Pat Davis, whose district includes the site, said the loss is disappointing but the city at least had received a $125,000 security deposit from the company early in its dealings so “taxpayers aren’t out” money. He said there is significant interest in that part of Albuquerque, and the city should be able to identify another tenant.
“It’s not that this company (TGI) changed their mind on Albuquerque,” Davis said. “It’s that in this tech sort of field, best laid plans don’t always work.”