With high-rise, Dudley Webb is back
BROTHERS BUILT ON LARGE SCALE IN 1980S
By Jim Jordan
JJORDAN1@HERALD-LEADER.COM
Brothers Donald and Dudley Webb gave Lexington its modern skyline in the 1980s with 14 buildings that include the city's tallest, the 30-story Lexington Financial Center.
Then the bulldozers stopped. Changes in federal tax laws, a real estate recession and the loss of financing from Kentucky Central Life Insurance Co. ended the Webb building spree.
The lawsuits that followed the collapse of Kentucky Central pushed the brothers into the courtroom and out of the limelight for a dozen years.
Donald Webb retired, but Dudley Webb returned to downtown redevelopment Tuesday when The Webb Cos. and partners announced a $250 million hotel, condominium, retail and office project that would reshape West Main Street between Limestone and Upper Street.
CentrePointe would be one of the city's tallest buildings, at 40 stories and 406 feet, and also one of its largest, with 77 condos, 243 hotel rooms, 85,000 square feet of offices and 1,100 parking spaces, mostly underground.
From almost any window on CentrePointe's south side, observers would be able to look across West Vine Street and contrast CentrePointe with the six-story First Federal Plaza.
First Federal, built in the 1970s and containing just 44,000 square feet, was the Webb brothers' first office project in downtown Lexington.
Dudley and Donald Webb were born in the coal-mining town of Hot Spot near Whitesburg in Letcher County, but they came to Central Kentucky for higher education. Both graduated from Georgetown College and the University of Kentucky College of Law.
Donald joined state government and Dudley began practicing law in Lexington. Donald later served as a special assistant at the White House during the Johnson administration and practiced law with a Louisville firm.
In 1971, Donald and Dudley formed their own Lexington law firm, and the following year, a real estate investment and development firm that would become The Webb Cos. in 1979.
In the meantime, the brothers met Lexington financier Garvice D. Kincaid, who controlled Kentucky Central, Central Bank & Trust Co. and other banks and businesses.
Kincaid began financing Webb developments. That source of funds continued after Kincaid's death in 1975 when W.E. "Bud" Burnett became president of Kentucky Central.
The brothers' other downtown projects include The Woodlands, Vine Center, Triangle Center, Victorian Square and the Commerce Lexington building.
The Webb Cos. was also active in Lexington's growing suburbs, building Corporate Center and other office parks; warehouses and distribution centers; and shopping centers, including The Mall at Lexington Green, Tates Creek Centre and Palomar Center.
They eventually built 5.5 million square feet of structures in Fayette County that are now assessed for a total of $250 million, according to The Webb Cos.
Most of Donald Webb's projects were in the Lexington area, but Dudley branched out with developments in many parts of the country, including New England, New York, Florida, Louisiana, Texas, Colorado and California. Donald participated in some of those developments.
Most of the Webbs' Lexington projects were successful. But at least one, Victorian Square, struggled financially for years, and another, Festival Market, failed.
Built for $16 million, Festival Market was owned 80 percent by Kentucky Central and 20 percent by the Webbs.
The site at West Main and North Broadway was purchased with $1.675 million from the federal government. The local government lent $500,000 from a community development block grant as the required match for the federal funding.
Festival Market opened in 1986 as an entertainment, restaurant and retail center, but it never made a profit. The building was sold for $600,000 in 1994 in an auction that was intended to pay off the holders of $8 million in local government bonds that had been sold to help finance the project.
Festival Market reopened in 1999 as Triangle Center, a successful retail, restaurant and office center.
By that time, Kentucky Central had disappeared.
In 1993, a year after suffering the largest loss in its history, Kentucky Central invited state regulators to take control to protect its policyholders. The insurer was later declared insolvent, and regulators began selling off its assets.
In 1994, the state insurance commissioner filed suit against the Webbs to collect $108.9 million in loans they had received from Kentucky Central.
The lawsuit resulted in 10 Webb-related limited partnerships filing Chapter 11 bankruptcies, but The Webb Cos. and the Webb brothers were never in bankruptcy.
The brothers stopped commenting publicly on most issues, and they started only a few minor projects until CentrePointe. The Webb Cos. focused largely on managing properties for themselves and others.
After Donald retired and Dudley became chairman of The Webb Cos., Donald's son, Woodford, became the company president.
Finally, the Kentucky Central shadow lifted.
After years of victories and defeats in court, out-of-court settlements were reached in 2005. Donald Webb settled his part of the lawsuit for $2.85 million and Dudley settled three months later for $1 million.
In April 2007, The Webb Cos. won a $5 million contract to build a marina at Dale Hollow Lake State Resort Park near Burkesville.
Dudley Webb was back in the game.