Offices have reportedly been secured and locks changed.
Wednesday, April 13, 2016, NewEnglandSkiIndustry.com
In a breaking news story being covered by WCAX, authorities have secured Q Burke's offices and changed the locks.
According to the Burlington Free Press, a joint press conference will be held tomorrow by Vermont's Governor, Attorney General Sorrell, Department of Financial Regulation Commissioner Susan Donegan, and Agency of Commerce and Community Development Secretary Patricia Moulton.
According to WCAX this evening, Q Burke's Ari Quiros would not speak on camera. "Quiros says he will report to work Thursday at Q Burke, but will only be providing assistance to the team of investigators looking into what has gone wrong."
Q Burke's idle, $50 million EB-5 funded hotel has come under increasing scrutiny in recent months. Both the Federal Securities and Exchange Commission and the Vermont Department of Financial Regulation have been looking into the project. Vermont Commissioner Susan Donegan claims millions of dollars in construction management fees have not been accounted for by Q Burke Hotel's developers.
Q Burke Hotel's developers are reportedly charging EB-5 investors a 15% construction management fee, in addition to a 10% investment fee.
Background
In 2007, the Vermont EB-5 Regional Center was rechartered. Under the EB-5 program, a foreigner can invest $1 million in an approved United States business (which must then create jobs), in exchange for a green card. With the Northeast Kingdom labeled a Targeted Employment Area, the minimum investment is cut in half to $500,000, making participating rural businesses such as Jay Peak more attractive.
The current ownership group has been in place at Jay Peak since 2008. Its first large EB-5 funded project, the Tram Haus Lodge, opened in December of 2009. A $27 million indoor water park opened two years later. Burke Mountain was acquired in 2012 and rebranded as Q Burke in 2013.
Ground was broken for the Q Burke Hotel in June 2014, with an opening scheduled for December 2015. The now-completed hotel remains idle, as general contractor PeakCM is holding the certificate of occupancy and a lien on the hotel until payment is received.
A recent report stated, "[t]he resort's president tells WCAX News there's a 50-50 chance it may not open for next ski season."
