Three major developers will face off in a Fairfax County courtroom this afternoon for the right to pay at least $25 million for one of the Washington area's most valuable and bitterly contested pieces of undeveloped property, 117 acres of woodlands known as Tysons II.
The unusual courtroom auction will pit two of Washington's major developers, Theodore N. Lerner and Homer Gudelsky, against each other and against a third group of Minneapolis developers who yesterday put down $200,000 for the right to participate in the auction.
At stake is what some have called the last major development opportunity in Fairfax's "downtown," a prime parcel surrounded by highways, hotels and the sprawling Tysons Corner regional shopping mall.
"The opening bid is going to be $25 million, and the question is how much higher than that we go," said E. A. Prichard, lawyer for Gudelsky and Max Ammerman, who with their families own a three-quarters share in Tysons II.
Prichard said he placed "in excess of $20,000" worth of advertisements in The Wall Street Journal and The Washington Post seeking to attract more developers to the auction.
"Many consider the Tysons II property to be the East Coast's most valuable piece of real estate," the ads proclaimed.
Several developers expressed interest, Prichard said, including Gerald Hines, who built the massive Galleria shopping center in Houston. All but one outside group decided to stay away from the auction, apparently scared off by the requirement that they produce the entire purchase price in cash within four months and by the seeming determination of Tyson II's third partner -- shopping center magnate Lerner -- to keep the land for himself.
"It's a nice piece of ground," said Eugene M. Rerat III, a representative of the Minnesota group that plans to bid today. "But one big problem in everybody's mind is that they won't sell, that Lerner or Ammerman or Gudelsky will go higher than anyone else will go, will do almost anything to hold onto the land."
Tysons II ended up in court three years ago when Gudelsky and Ammerman, who is a longtime Maryland developer and Gudelsky's attorney, fell out with their partner Lerner. The partners had developed the original Tysons Corner mall together, but after their plans for a second mall across the highway collapsed, they could not agree on how to dispose of the land.
When Gudelsky and Ammerman agreed to sell the land to a Boston developer, Lerner objected and said he would buy his partners out instead. Fairfax Circuit Court Judge Richard J. Jamborsky ruled that Lerner and the Boston developer, Atlantic Monthly owner Mortimer B. Zuckerman, should fight it out in court, and at the first great Tysons II auction in 1981 Lerner won the duel for $35 million.
Lerner later decided not to close the deal, however, throwing the partners' feud and the question of what will be built on the valuable parcel back into court.
"I refer to it as the annual Tysons II auction," joked Jamborksy, who will conduct the sale at 2 p.m. today at the county courthouse. "Some places have an annual roast; we seem to sell Tysons II every year."