The Ritz-Carlton Paradise Valley Was Planned as One Project. November's Vote May Treat It as Three.

The resort near Scottsdale Road and Lincoln Drive has three parts: a 215-room hotel, a group of Ritz-Carlton-branded villas and estate homes, and a 29-acre retail and dining district called The Palmeraie. For years, the Town of Paradise Valley used its approvals to keep those three parts moving together. Under the Chapter 11 plan filed this fall, they could be split up and sold to different owners.

Here is what the court record and local reporting show as of early October 2026. Some of the homes are occupied. The hotel is still incomplete. No Palmeraie shop or restaurant has a verified opening. Creditors are scheduled to vote on the plan in November.

A decade of opening dates

When the hotel was first announced in January 2016, construction was set to start that July, with the resort opening in "late-2018." Each later target pushed that date back.

Two separate disputes caused the delays, and they often get mixed up. The first was with the general contractor. Five Star picked PWI Construction Inc. to lead the build in 2021, the two ended up in a lawsuit, and a jury returned a verdict in November 2024. That case is over. The second dispute was with the lender, and it led to the bankruptcy. That one is still open.

The hotel's planned features explain why the town has cared so much. Court filings describe a 16,000-square-foot spa, more than 80,000 square feet of outdoor event space, restaurants including Mott 32 and Carbone, and a 400-foot pool facing Camelback Mountain. The Ritz-Carlton Hotel Company, a Marriott subsidiary, would run the hotel. The developer says the pool would be the longest in North America. Mott 32 was announced in April 2024 as a restaurant that would open with the resort. Neither restaurant has opened, because the hotel they are part of hasn't opened.

Why the homes got ahead of the hotel

The homes were finished first because of a deal with the town. According to AZBEX, Paradise Valley allowed the villas to be built before the hotel was done, partly so villa sales could help pay for the hotel. The condition was "substantial progress" on the resort. When hotel construction stopped, the town stopped issuing certificates of occupancy for the villas. AZBEX also notes that the town has a direct financial stake in the hotel opening, because it brings in tax revenue.

The first homeowners moved in under that arrangement. In January 2024, the Paradise Valley Independent reported that the villas were finished but no owners had moved in yet. Five Star had expected the first move-ins by the end of 2023, and the company handling sales said closings would start that February and continue through the summer. In its November 2025 bankruptcy declaration, Five Star said many of the villas and estate homes were complete and occupied. The plan includes 80 villas, which the developer called fully pre-sold, and 32 private estate homes. The September 2026 PBJ summary refers to "unsold villas." Some 2025 contracts may not have closed, or the two sources may be using the terms differently. The public record doesn't settle it.

Five Star has said the halt on certificates of occupancy stopped sales of 40 villas worth $150 million. That number comes from the developer's lawsuit. It shows how tightly the pieces were connected. The hotel needed villa money, and the villas needed hotel progress before the town would let anyone move in.

How a construction loan turned into a Chapter 11 case

In 2023, Madison Realty Capital and its affiliate RC PV Lender I LLC agreed to lend up to $585 million to finish the project. Five Star says Madison declared a default around April 9, 2025 and stopped funding. On May 21, Madison said the loan had been fully funded. Five Star has also claimed in court that Madison pushed contractors to prioritize the residences over the hotel. These are the developer's allegations. No court has ruled that they are true.

From there, things moved quickly:

• May 5, 2025: Five Star sued the lender in Arizona.
• July 2025: A Texas state court granted Five Star a preliminary injunction. This was temporary relief, not a final ruling.
• November 4, 2025: Five Star filed for Chapter 11 in the U.S. Bankruptcy Court for the Southern District of Texas, Houston Division. The case is In re F-Star Socorro, L.P., et al., Case No. 25-90607.
• November 12, 2025: Madison had scheduled a trustee sale of the property for this date. The bankruptcy filing stopped it.

At the time of the filing, Five Star told AZBEX the hotel was nearly complete and interior finishes would start once the court approved them. Almost a year later, that work has not been reported as started.

What the September filings set up

Five Star's lawyers filed a Joint Chapter 11 Plan for the Ritz project debtors as Docket 1040. A September 22 court filing describes it as a plan to liquidate and wind up certain debtors. A disclosure statement and a motion setting out voting procedures appear on the docket on September 24. Separately, the court is considering a $180 million financing commitment from an affiliate of Farallon Capital Management.

Jordan Rose of Rose Law Group, who is not involved in the case, read the plan this way in comments to the Phoenix Business Journal:

"If they do not exercise this option, the hotel will go to auction and the rest of the land can be sold with the hotel or separately. And in any case, the villas are sold separately."

Rose Law Group describes the "option" in that quote as Five Star's limited chance to buy the full 120 acres at a price set by the bankruptcy court. If Five Star uses the option, the project stays under one owner. If it doesn't, the hotel could go to one buyer, the Palmeraie land to another, and the villas would follow their own process. That would separate the hotel from the homes, which is exactly what the town's certificate-of-occupancy condition was meant to prevent.

Several important details have not been made public in anything we could access:

• The ballot deadline and the date of the confirmation hearing
• The price and deadline for Five Star's purchase option
• Any named bidder or plan sponsor for the Paradise Valley property
• A new opening date for the hotel
• How Madison's secured claim on the Paradise Valley property will be handled

A September 25 sale hearing on the docket concerned properties in El Paso and Socorro, Texas, not the Paradise Valley resort.

Where to follow it

The Stretto case site posts court filings as they are entered, including the September plan materials and the November 2025 first-day declaration that most of this timeline comes from. The Phoenix Business Journal and AZBEX have covered each filing. The town has a Five Star Development project page, though it showed no new status update when we checked.

The next key date is the creditor vote in November. The outcome will determine whether Five Star buys back the whole site or whether the hotel goes to auction.

If you live near Lincoln Drive and Scottsdale Road, or own property there, and want to talk through what each possible outcome could mean for the area, Alex LeBouton is following the case and happy to talk it over without any pressure. Schedule a Consultation whenever it suits you.

This article is general information, not legal, tax or financial advice. Consult a qualified professional about your situation.