As the wheels started to fall off at Austin-based developer StoryBuilt this summer, its investors and creditors were “scrambling to raid any available asset,” placing a court-appointed receiver in the middle of an all-out real estate fight.
The receiver, Los Angeles-based Stapleton Group, now has to stand between those rabid raiders and chart a path forward for the company’s assets. Some of the investors aren’t so happy about it.
A global private equity firm and a Texas political dynasty are pushing back on the receiver as it looks to sell 28 of StoryBuilt’s properties — which it claims are worth $2 billion — as part of its strategy to make creditors whole. In the midst of it all lies a little-known Houston marketing firm that launched the receivership, looking to protect millions of dollars it holds in the company. In all, the situation adds up to Texas’ biggest development meltdown of the year, with new details still emerging as power players angle for their cut of what remains.
On one end of the fight are the Craddicks — former Texas House Speaker Tom Craddick, his son Tommy, and his daughter Christi, who chairs the Texas Railroad Commission — who argue they arranged a sale of one StoryBuilt property in which they invested, well before the receiver entered the picture. But the sale came with certain conditions the receiver now threatens to upturn, blowing up the deal, they wrote in a court filing.
The property in question, referred to as “Project Goose” in the filing, is a 36-home single-family development site at 9601 White Rock Trail in Dallas. In May, Tommy Craddick introduced StoryBuilt to Stillwater Capital Investments, and the following month, Stillwater made an offer on the property, according to the filing. Before the receiver was appointed, Stillwater had sent a letter of intent to buy the property for $10.7 million, the filing alleges, on the condition that the Craddicks and one other investor roll over the roughly $4 million they had invested in the project thus far.
But that plan would fall apart if the investors can’t put their money back into the new development. In a recent report, the receiver said it will not distribute proceeds from asset sales right when they are sold, except for secured debt obligations. It is holding on to the money while it conducts a forensic accounting analysis, because it noticed StoryBuilt didn’t use typical accounting practices and may have misused funds invested for specific projects on other projects.
That layover time would make it impossible for the Craddicks to roll their investment over, as the money would be tied up until the receiver releases it.
“If the current investors are unable to have access to their funds immediately upon closing, we will have to terminate this contract and compete for the land at its true value which is well below 10 million (probably closer to 8 million),” wrote Stillwater’s Robert Elliott in an email to the receiver.
In their filing, the Craddicks hardly hide their frustration with the process.
“Prior to its reversal that threatens to kill the sale, the receiver’s only impact has been to delay the sale and cost the estate more money in fees and expenses,” the filing reads.
Meanwhile, Partners Group, a Swiss asset manager with $142 billion in assets under management and StoryBuilt’s biggest financial backer, takes issue with a broader swath of the receiver’s sale.
Partners is party to joint ventures covering 17 StoryBuilt projects in Austin, Dallas, Denver and Seattle, it writes in a filing. However, the company claims it was blindsided by an Oct. 9 news release announcing the sale of 28 StoryBuilt properties.
Despite alleged assurances that it would receive advance notice and a chance to comment on marketing materials for the portfolio, Partners claims the receiver announced the sale without any consultation.
“The press release, which was picked up by over twenty publications, created substantial confusion in the market,” the firm wrote. “The press release falsely indicated to the market that the properties, which are neither owned nor controlled by [StoryBuilt], were on the market in the receivership sale.”
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In the time since the news went live, Partners has received multiple calls about the sale, some from firms looking to buy, and others from investors concerned about the state of their investment, it writes. Partners says it contacted the receiver once it learned of the marketing materials and demanded it print a retraction clarifying that StoryBuilt was only selling its minority interests in the joint ventures, not any direct real estate assets.
Partners also claims that, according to the JV agreements, StoryBuilt’s membership interests cannot be sold without its consent.
According to an August 2022 pitch deck from StoryBuilt obtained by The Real Deal, Partners contributed at least $180 million to StoryBuilt joint ventures, making it the firm’s largest development partner. But in July, StoryBuilt was removed as an operator under each of the joint-venture agreements — before that, it held 10 percent of membership interests in the joint ventures, according to the filing.
In its recent report, the receiver said it had rehired about 50 StoryBuilt employees who were laid off in August. This skeleton crew works in development management, project management, accounting, marketing and sales. Since entering receivership, the firm has backed out of HOA management, architecture and design, software development and managing joint ventures.
As of the report, 34 parties had expressed interest in the StoryBuilt portfolio, and 19 had signed nondisclosure agreements to view more data.
At the heart of the case is a low-profile Houston marketing firm that doesn’t even appear to have a website. G.E.T. Marketing is the firm that officially requested a receiver take over StoryBuilt’s assets earlier this year, and it is listed as the plaintiff in the receiver’s case in Travis County courts. But little is known about the firm, or why a marketing company came to own such a significant amount of StoryBuilt.
In several G.E.T. documents, someone named Trey Cook signs for the LLC. He lists a mansion on Lake Travis as his address, and the office address attached to the LLC is a Houston mansion he used to own.
The firm owns 140 Class A1 units of StoryBuilt at $4,000 per share and 224 units split between A2 and A3 classes at $5,000 per share, according to filings in the receivership case. In all, those shares are worth $1.68 million at face value. G.E.T. also committed $7 million for an unissued round of shares, according to the receivership filings.
Trey isn’t the only Cook in the kitchen.
Garrett Cook owns shares and debt from the unissued round worth $1.24 million, and Travis Cook owns half that. Jerry Todd Cook holds a $500,000 promissory note from StoryBuilt, and Emily and Taylor Cook are also mentioned in the receiver’s report.
The Craddick Group and G.E.T. Marketing, which do not have websites, could not be reached. Partners declined to comment, and Stapleton did not respond to a request for comment by publication time.
The next hearing in the case is scheduled for Nov. 16.