Developer Mark R. Vogel said yesterday he expects to clear about $15 million from the sale of his two Maryland racetracks, an amount he said would be sufficient to save his troubled real estate projects.
Vogel, 42, speaking to the news media for the first time since his arrest on a cocaine possession charge, said in a telephone interview that profits from the sale of Rosecroft Raceway in Oxon Hill and Delmarva Downs near Ocean City, Md., should give him enough capital to pay his debts and save one of his projects, the Villages of Belmont in Prince George's County.
Vogel, whose purchase of the racetracks in 1988 gave him a monopoly on harness racing in Maryland, said he is asking between $25 million and $30 million for the two tracks and that he has received several expressions of interest. He said he hopes to clear $15 million after repaying $10 million in loans he used to make capital improvements at the tracks.
"We determined that the easiest thing for us to do would be to sell the racetracks. People are in this business because they love it, and the tracks brought me a great amount of enjoyment. But I have to face the hard, cruel facts of life," Vogel said.
The developer refused to discuss the cocaine possession charge pending against him or other issues concerning his principal business, the Mark Vogel Cos. He was arrested Sept. 13 by Fairfax Police and Drug Enforcement Administration agents after a six-month investigation.
Vogel's attorney, Plato Cacheris, has said that Vogel would plead not guilty to the drug charge. Last week, the DEA seized Vogel's corporate helicopter, valued at about $750,000, claiming that he used the aircraft to transport small quantities of cocaine to Atlantic City for use by himself and his traveling companions.
Law enforcement sources say the probe of Vogel stemmed from a routine drug investigation, but soon expanded into a broader look at influence-peddling by a circle of developers and lawyers.
Vogel, a Bowie-based developer known for his high-risk real estate investments, disputed reports of a bleak financial future for his real estate empire, which once had an estimated value of $1 billion.
Vogel is the developer of the Bowie New Town Center, a massive office and residential development, and owns thousands of acres of real estate stretching from Stafford County, Va., to Somerset County, Md.
Since his arrest, Vogel's financial problems have mounted. His corporate staff, which once had about 45 employees, has laid off all but about 10 people.
This month, one of Vogel's partnerships filed for protection from its creditors under Chapter 11 bankruptcy laws on the Villages of Belmont, a 1,200-acre residential development near Upper Marlboro. The move stopped a scheduled foreclosure sale on part of the property.
Real estate experts and some of Vogel's business associates predicted that the filing could have a domino effect on other highly leveraged projects under development by Vogel.
Vogel, however, said his advisers are mapping out a business plan to save the projects.
"This real estate market is worse than anything we could have imagined in our wildest dreams," he said. "If everyone in the world is scrambling to make it, why shouldn't we be scrambling?"
Vogel also defended his withdrawal of more than $2 million in track funds to cover debts on his real estate interests.
He said he put about $10 million of his own money into the tracks when he bought them and that he viewed the withdrawals as a matter of using his own money.
The withdrawals brought Vogel under scrutiny by the State Racing Commission, which this month forced Vogel to remove himself from the day-to-day operation of the tracks.
Racing officials feared that Vogel would use proceeds from the tracks to support his real estate interests, a move they felt would jeopardize the future of the state-regulated tracks.