Chattanooga businessman Allen Casey has scaled the heights and plumbed the valleys of the real estate development game.
He took a neglected railroad terminal slated for demolition downtown and turned it into the Chattanooga Choo Choo, a popular city landmark and one of Tennessee's top tourist destinations.
But on Wednesday, 40 years removed from his signature achievement and unable to pull off his latest project on a high-profile tract of land off the Tennessee River downtown, Casey filed for personal bankruptcy. Casey's filing came just two days after his company, River City Resort, filed a Chapter 11 bankruptcy petition.
"It's a sad ending to a long story," said Bob Doak, the Chattanooga Convention and Visitors Bureau chief.
The filings came as Casey and his company faced a civil trial in a lawsuit from investors over the waterfront tract that Casey had hoped to remake into a hotel and condominium development. But Gary Patrick, an attorney for the investors, accused Casey of taking up to $7 million from deals involving the land for which there is no accounting.
Casey has declined comment. In court papers, he denied wrongdoing and asked that the lawsuit be dismissed.
In his Chapter 7 filing in U.S. Bankruptcy Court in Chattanooga, Casey's assets were put at $50,000 or less. Liabilities were estimated at $1 million to $10 million. Attorney David Fulton, who filed the petition, said a hearing is expected to be scheduled.
Patrick said the lawsuit is delayed, though the facts may be tried in bankruptcy court. The next hearing in the Chapter 11 filing is set for March 18.
Casey, 80, has tried to develop the 9-acre parcel off Manufacturers Road for the better part of two decades.
He had envisioned a boat hotel project in which a crane would lift boats off the river and into a small lagoon.
Later, in 2004, he unveiled plans for a 98-room hotel and 60-unit condominium complex with a restaurant, though nothing was built. Still later, Casey bought a barge and floated it from Pittsburgh, docking it in front of the property with the intent of reworking it into a floating New Orleans-style restaurant and bar.
The barge became a lightning rod for community criticism after it sat for years and became dilapidated, and there were calls for it to be removed from the riverfront. Casey cleaned up the barge, but its U.S. Corps of Engineers permit is under review by the federal agency.
Doak said Casey has a legacy in the Choo Choo and, in that respect, has left a mark on the city.
"He saw the value of saving the old Terminal Station and what it could be for the future," Doak said.
But he cited Casey's failure to redevelop the barge and the adjoining parcel.
"You clearly need visionaries and leaders to make things happen," Doak said. "But you've got to ensure your dreams are sustainable, both financially and for the long term."
Casey, whose wife, Emma, is a member of the long-standing and well-known Patten family in Chattanooga, developed the Choo Choo in the 1970s, raising some $2 million to turn the site into a hotel, restaurant, convention and tourist complex.
Casey later recalled in an interview in a Chicago Tribune piece that he had spotted a tiny article in a Chattanooga newspaper in 1971 about demolishing the old terminal. Already toying with the idea of a new downtown hotel, Casey sized up the old depot, stating, "Gee, this would make a fantastic entertainment complex."
"Immediately I thought of the song 'Chattanooga Choo Choo,' and I wanted to save the building right then and there," he said.
After opening in 1973 and experiencing success, the Choo Choo ran into financial problems related to increased lodging industry competition and soaring interest rates. In 1987, the Choo Choo filed a bankruptcy reorganization plan. It was sold at auction in 1988, and Casey lost control of the facility.
Casey turned his attention to the riverfront site. He floated the boat hotel idea, and even considered mooring the Delta Queen steamboat in front of his property. He dropped the riverboat plan when one of the project's investors pulled out, though the steamboat later came to Coolidge Park nearby.
Kim White, who heads the downtown nonprofit redevelopment group River City Co., said it's been disheartening that Casey has indicated he has "this big stuff coming and money coming and that obviously was not the case."
She said developing raw land is a complicated process.
"One project doesn't make a visionary," White said.
Tennessee Aquarium head Charlie Arant, who at one time was a business associate of Casey's, didn't want to talk about the developer on a personal level.
But, Arant said, the riverfront site is a prime location and has high potential.
In terms of the barge, Arant referred to it as "an unsightly mess" and hopes it's moved.
He called for smarter ways to develop the city's riverfront property downtown.
"It's incumbent on all of us that we get the right kind of development that will benefit everybody," Arant said.
Matt McGauley, vice president of Chattanooga developer Fidelity Trust Co., said timing often plays a key role in seeing a project come about.
"Sometimes the best calculation, if you get caught in the wrong real estate cycle, can kill the best ideas and deals," he said.
McGauley said developers need some level of stubbornness but also flexibility.
"Sometimes you have to adjust your thinking," he said. "If you're dead set, you can find yourself going down a route that will lead you into trouble."
Contact Mike Pare at email@example.com or 423-757-6318.