Firm proposes deal with Portsmouth to build courthouse

PORTSMOUTH

A Chesapeake company has offered to build a new Circuit Court and lease it back to Portsmouth, a proposal that could help the financially strapped city in years to come.

The unsolicited offer also is exactly what council members say they've hoped for - a way to build a new court without taking on the costs of construction.

But it comes from an unlikely source.

Chesapeake's White Rhino Development LLC formed last summer and operates from a Chesapeake townhouse. It has partnered with Khanjee Holding Inc., a Pakistani company whose president has said that he has financed projects around the world.

Their proposal doesn't stop with the courthouse. It also asks the city for some of Portsmouth's largest developable parcels of land, including three spots along the downtown waterfront.

In return, the company promises to build a six-star hotel and shops, restaurants, housing and offices, along with a sports arena near Cradock and a shopping mall similar to MacArthur Center near Victory Crossing.

City leaders said the proposal will be vetted by staff but that the partnership probably isn't the angel that Mayor James Holley has said the courthouse project needs.

"I'm not holding my breath," Councilwoman Elizabeth Psimas said. "I don't have any historical information on what great projects they've done, which makes me very leery. Even the stationery is not particularly impressive."

Budget analysts have shown that if Portsmouth finances the court construction in the typical way it pays for public projects, the city would be more than $7 million over its spending limits annually in 2009, 2010 and 2011. The price tag for a new Circuit Court is estimated at $45 million.

"I'm for looking at anything that would be in the interest of our taxpayers," Councilman Bill Moody Jr. said. "We need to look at all options. This might be an option, once we know more about it."

In a letter to the city, Khanjee Holding CEO Akhtar Ali Khan said Khanjee were "renowned owners and investors in major international infrastructure and development projects."

In his letter, Khan mentioned that at one time his company was the largest private shareholder in Banque Nationale de Paris/Paribas.

He did not list any construction projects. Records obtained by The Virginian-Pilot show that in 2001, the company provided financial backing for the construction of a coal-fired energy plant in Illinois. However, the plant was never built.

Several years ago, Khan's company also proposed building a new arena in Baltimore but was not selected by the city.

The company's Internet site is registered with GoDaddy.com, a low-cost Internet domain provider. The phone number for Khanjee Holding goes to a variety of technology businesses in Sterling, Va., all owned by Khan.

Khan and the company's public relations manager were out of the office and unavailable for comment Friday, a receptionist said. A message left Friday was not returned Monday. Calls to White Rhino partners James Alberts, who lives in Cape Charles, and Tony Jacobs of Chesapeake were not returned Friday or Monday.

City Manager Kenneth Chandler said he met with more than a dozen representatives of the two companies last month. The meeting was mostly a fact-finding exercise so the businesses could learn about Portsmouth, Chandler said.

Their proposal is so broad, he said, that it will need to be pared down before city officials can consider any specific projects, including the courthouse.

"We just need to make sure they're capable of doing what they say," Moody said.

Meghan Hoyer, (757) 446-2293, meghan.hoyer@pilotonline.com