The Happy Canyon Shopping Center in Denver’s Southmoor Park neighborhood is expected to be sold out of bankruptcy in the coming weeks.
Meanwhile, the legal case against the real estate magnate who owns the center has grown, and the future of a proposed food hall in a vacant former Safeway that shares a parking lot with the center remains murky.
Golden-based BPI Inc. on Feb. 22 put forth a winning $24.2 million bid to buy the Happy Canyon center from the bankruptcy estate of Cherry Hills businessman Gary Dragul, court records show. The sale is expected to close next week, according to Harvey Sender, the attorney overseeing the Dragul bankruptcy.
In addition to the center, which is at the corner of East Hampden Avenue and Happy Canyon Road and is anchored by a Starbucks and a Corepower Yoga studio, BPI is purchasing some of the mortgage debt attached to the vacant Safeway building.
That property for the last few years has been the targeted landing place for a food hall concept akin to Denver Central Market, with a Tony’s Meats outpost expected to be the headline tenant. Plans for that project were put on hold after a Colorado grand jury last spring indicted Dragul on nine counts of securities fraud.
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Partners in the project, including officials with Tony’s, expressed optimism the work would start back up again this year, even projecting the hall could be open by this summer, but some neighborhood residents have expressed skepticism that the gutted building could be transformed that quickly.
Dragul’s 9.4-percent interest in the Safeway is also slated to be sold in the coming weeks, Sender said. The buyer is an entity out of Houston called Isabel Marina LLC. The majority owner of the Safeway remains Hagshama, an Israeli investment firm.
As his real estate assets are sold off, Dragul moves closer to a court date. He was indicted on five additional counts of securities fraud earlier this month in relation to an alleged real estate scheme state officials say he orchestrated dating back years. He now faces 14 total charges with an arraignment hearing scheduled for Arapahoe County Court on May 3.
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Dragul has maintained his innocence in the case.
“We’re looking forward to our day in court,” Dragul’s attorney Harvey Steinberg said Tuesday. “There are two sides to every story. The indictment tells one side, we’re looking forward to being able to tell ours.”
