Megatel Homes, one of North Texas’ most prolific homebuilders, is suing even more prolific Centurion American Development Group and Grapevine-based United Development Group, charging that the firms “conspired to take advantage of Megatel,” mostly by selling development properties to competing homebuilders. Megatel is seeking $100 million in damages.
If the names of these companies sound vaguely familiar, let me refresh: Megatel Homes builds houses, townhomes, and apartments, in 100 subdivisions or more all over North Texas. It is the same firm that entertained a tentful of agents with former New York Mayor Rudy Giuliani and Kevin O’Leary last May at an amazing and expensive promotional bash at Mercer Crossing, up near Cypress Waters and LBJ/635. And Mehrdad Moayedi was there, sitting with Megatel’s two co-founders and the celebrity guests.
2500 real estate professionals, with full bar service and seated dinner. There was a huge white tent with a/c. Even the bathrooms were tip-top, those nice white trailers just like the ones at the Pebble Beach Concours D’Elegance. There was a smattering of tip top producers, too, from Dave Perry-Miller’s Ryan Streif and Charles Gregory, who has already sold two homes in Mercer Crossing, ReMax Premiere’s Von Truong, Bryan Poche, Dallas City Center’s Lisa Marie Dyess-Richardson, the ubiquitous Jeff Lindigrin, and more. Donations were also raised for Guns and Hoses Foundation of North Texas.
Steve Brown wrote a nice two-brothers-from-Cypress profile on the firms’ brother-founders, Zach and Aaron Ipour. He pointed out that competitors criticize Megatel, saying it pays too much for some of its land, and question the firm’s long-term funding strength. The company, Steve reported, also builds more speculative homes than many of its competitors.
Megatel is the same firm where a townhome collapse during a weather-related storm caused the death of one worker, the injury of five in West Dallas last October. Six workers were working inside a three-story Megatel townhome under construction on Borger Street, near Singleton Boulevard. Raul Ortega Cabrera, 35, was confirmed dead at the scene. The Dallas Morning News reported that he was a father of two, with one more on the way. Here is also what The News reported:
“Shortly after the collapse, a woman was seen removing Megatel signs from the surrounding area,” the Dallas Morning News said. “An employee who answered the phone for Megatel Homes hung up and subsequent calls went unanswered.”
And it is the same firm that agents formerly with the company tell me seems to be a revolving door for Realtors: I know one agent who is fighting with the company for several thousand in commission checks.
Centurion American is one of the largest residential developers in Dallas-Fort Worth, with many home communities scattered from Dallas, to Propser, to Aledo. It is the company that re-developed the Statler Hotel in downtown Dallas. It’s the company that bought the Crespi Estate in Preston Hollow, among many others.
Among Megatel’s numerous charges is a claim that Centurion American sold off homebuilding sites in its new communities to other home builders to raise cash. Megatel says the lots had been pledged to Megatel.
“As alleged in the petition, our client believes that defendants conspired against their company to unfairly remove it from significant projects and to gain financial benefits to which defendants were not entitled,” William A. Brewer III, partner at Brewer, Attorneys & Counselors and counsel for Megatel, said in a statement emailed out Wednesday afternoon.
United Development was the company scrutinized last year by the Feds over accusations of running an investor Ponzi scheme after those accusations were lodged by Hayman Capital Management founder Kyle Bass. Centurion American was also dragged into that investigation, perhaps because they were one of United’s biggest customers:
Now I did consult a financial broker who explained that REIT funds are usually invested in real estate like malls, office buildings, strip shopping malls, hotels, or even entire neighborhoods of homes. In other words, tangible assets. Bricks and mortar on the dirt. They then get their income from leasing these out, and that’s how investors are paid. Instead, from what Kyle Bass has said in his website, United Development acted more like a bank for speculative builders. Then there is his accusation that loans in one fund were being paid off from loans in another fund. If funds were improperly handled, and the FBI or SEC sees evidence of it, Kyle Bass will be a hero. But he could be very wrong about Centurion.
He was. United Development paid $8 million in fines to the Securities and Exchange Commission for what the SEC called “misleading investors.”
After months of investigation, Centurion American wasn’t implicated in the SEC allegations.
Centurion America CEO Mehrdad Moayedi issued a statement for the press late on Wednesday: Megatel’s legal action has no merit, he said, and will likely result in a summary judgment.
“This lawsuit is a sign of desperate man grasping for a lifeline. In the past 6 months, $15.2 million worth of contracts with Megatel have been terminated for failure to close lots and on a number of remaining contracts, they are continually in default. As a result of Megatel’s own poor business judgement, they have an inventory in excess of 600 unfinished and unsold homes.
Centurion has a long standing relationship with reputable builders in North Texas. The allegations contained in the lawsuit have no basis in law or fact and will most likely be summarily dismissed.” -Mehrdad Moayedi, CEO of Centurion American Development Company
Of interest: Aaron Ipour, co-founder of Megatel and Zach’s brother, also has a luxury home building firm called Oxbridge Custom Homes. A cursory search did not help me find a website, only a quote in this 2015 D Home story, along with Andy Clem of Bella Vita Custom Homes. Oxbridge builds exquisite, high-end homes a far cry from the very nice $279K to $400K stock seen at Mercer Crossing or other Megatel developments. Aaron Ipour built a spec estate at 9362 Hollow Way in Preston Hollow, which you can see here was a real looker at 16,300 square feet on 1.1 acres in the Honeypot — Mark Cuban lives across the street.
Described as a “fabulous new French Revival estate, meticulously crafted with exquisite materials. Light and bright with barrel-vaulted corridors and balconies off nearly every room. Gorgeous walnut woodwork, exotic marble floors, onyx sinks and counters, French Deco bronze and steel accents throughout. State-of-the-art custom SieMatic kitchen, basement wine cellar/tasting lounge and attached guest quarters. Incredible outdoor living with glass-tiled pool and spa, top of the line outdoor kitchen and an additional 700 square feet with two cabanas, one that is set up as an exercise room and the other as a pool bath with wet and dry saunas.”
Both wet and dry saunas! The home went on the market April 6 of 2018 for $14.95 million and sold in June of the same year for $13.533 million. Looks like Aaron, using the name Arash Afzalipour, bought the property in late 2013 with a partner, then moved in himself in November of 2016, when he became the sole owner.