14-15 Investment Company

By Rick Wilhoit, November 2022

One of my fun investments began in the late 1970s when several of my partners at Doherty Rumble & Butler (DRB) and I agreed to plan a bit for our financial futures.  The partners were Bill Cosgriff, Tom Rohricht, Ralph Morris, Rick Wilhoit and Jack.  Our plan was to each contribute $1500 each per year until there were sufficient funds to invest in a project of interest.

First, the name of our enterprise was simple.  At the time DRB’s offices were on the 14th and 15th floors of the First National Bank Building in St. Paul.  The name of 14-15 Investment Company (14-15) was quickly agreed upon.

One of Bill’s clients was Dan Dolan.  Dan was Bill’s brother-in-law and also a real estate developer in St. Paul.  Dan had successfully completed several housing projects on the east side of St. Paul.  Now he wanted to try his hand at a commercial building.  He selected a site on Valley Creek Road in Woodbury for a two-story, multi-use office building. He would use a small portion of the space for his business office.

Dan needed some investors.  The plan was to have five 20 percent partners.  14-15 became one of the 20 percent partners.  Dan and another investor each took 20 percent while another investment group of four prominent St. Paul business men, who were known to the other investors, acquired 40 percent.  That turned out to be a bit financially unfortunate.  14-15 had enough money in our “opportunity” account to cover our equity. 

The building was completed. Dan moved in, but before he could find other tenants a business came along which wanted the entire building, and it wanted to control security of the building.  Great.  We had an ideal tenant and all Dan had to do was to collect the lease payments.  Two subsequent tenants also wanted 100% under terms similar to the first tenant.  Eventually 60% of the owners wanted to sell the property while it was fully occupied.  The 40% partner deferred on a sale, apparently because they needed the regular cash flow.  As a result, the property was ultimately sold, but when it was vacant.  This resulted in a loss from what could have been realized if it had been sold when fully leased.

A short time later Dan brought to his investors an opportunity to acquire 100 acres in the NW corner of Interstates 694 and 94.  We were able to fund our investment in this property from the distributions regularly received from the Valley Creek Road property which 14-15 accumulated, rather than distributed to the five DRB partners.  The investors in this land included only the three 20% investors in the Valley Creek Road property.  Twenty acres of this property was sold very quickly.  A small shopping mall was built on it.  We had hoped to divide the remaining 80 acres into lots for sale.  The City of Oakdale had a different plan for us.  Before it would approve our development plan it required, we create a plan for the entire 80 acres, which included installing the necessary infrastructure namely, water, sewer, utilities and of course, roads.

In order to meet this cost Dan arranged for the bank financing.  A requirement for this financing was that all the partners needed to obtain additional personal large life insurance coverage.  Not all partners complied, however, Dan obtained the needed loan.  As a result, the required infrastructure was completed and the 14 commercial lots were sold over the following 3-4 years.

To assist with the development expense Dan sought Tax Increment Financing (TIF).  This required the participation of Washington County, the local school district and the City of Oakdale because additional real estate taxes otherwise receivable based on the development improvements would be deferred from these entities for several years.  After all parties agreed to the plan, the Oakdale city manager tried to back out.  Following some legal sparring, and Dan’s and my deep dive into Oakdale city records and meeting transcripts, the TIF plan was implemented, and, as I recall, the city manager found himself looking for other employment because of his perfidy.

There was a humorous episode associated with this project.  During the installation of the infrastructure a large unusual boulder was unearthed. Colorful mineral deposits surrounding the boulder resulted in an appearance of a work of art.  It was set aside on the property for later location and display.  One weekend it disappeared.  After a bit of investigation, it was learned that a front-end loader and a truck with City of Oakdale markings had been seen on the property and the occupants were observed removing the boulder.  Within a few days after identifying the culprits the rock was returned.  Today it still remains prominently displayed at the entrance to the property.

Richard Wilhoit was born March 17, 1939, in Minneapolis to Margaret M. Morison and Richard O. Wilhoit.  He shares a birthday with his golfing hero, Bobby Jones and jazz great, Nat King Cole.  Rick matriculated from Hopkins, MN high school, Creighton University and the University of Minnesota Law School.  During his under graduate years and the year thereafter, and before entering law school, he spent a total of six years in the U.S. Army and Army Reserve.

Rick’s law career began with Doherty, Rumble & Butler in St. Paul where he practiced for 32 years until DRB closed in 1999.  Following DRB’s closure, he transferred his practice to the Briggs & Morgan firm.  His practice career focused primarily in the areas of estate planning, estate administration and trust and estate litigation.  Following the conclusion of his legal career he had the pleasure of a few minor contributions to Jack Hoeschler’s Right of Way litigation against the City of St. Paul