Report questions Warrs’ real estate deal

by Associated Press

Published: March 4,2010

Tags: fraud, Hurricane Katrina, real estate, Warrs

GULFPORT — A government report suggests the Armed Forces Retirement Home (AFRH) should have gotten appraisals on the two beachfront parcels that it sold in 2004 to Gulfport businessman and former Gulfport mayor Brent Warr.

The Feb. 22 report by the Inspector General’s Office of the U.S. Department of Defense says the Retirement Home probably could have gotten more money for the property but independent appraisals were not done.

The inspector general report says it found no other issues related to the Warrs’ real estate transaction.

In 2002, the Armed Forces Retirement Home intended to purchase 10.2 acres for about $1 to $2 million to expand the beachfront property. However, according to the report, the price jumped to $5.7 million.

To recoup some of those funds, the land was divided into three parcels. The AFRH sold the two beachfront parcels, and the homes on those properties, to the Warrs.

Warr bought the beachfront properties in Jan. 2004 for almost $1 million. The sale price was based on market surveys of comparable sales, a common practice in real estate, AFRH said in its response to the IG’s report.

After expenses, AFRH returned $934,000 to a trust fund from which it took money to buy the land.

In Aug. 2005, Hurricane Katrina destroyed the retirement home and heavily damaged the beachfront homes.

Warr, who became mayor in 2005, and his wife were later charged with Katrina fraud over recovery losses they claimed on one of the homes, which they listed as their primary residence.

The government alleged the home was under renovation and unoccupied, but the Warrs said Brent Warr already had moved in and his family considered it home.

In the end, Warr pleaded guilty to one count of FEMA fraud, receiving a year’s probation, while 19 other charges against him, and a total of 20 against his wife, were dropped. Their home has been completely renovated, as has the home on the other beachfront lot, where his parents live.

The retirement home also is being rebuilt. It should be completed in July.

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