You can imagine why Adam Weinstein would be unhappy with the new housing development planned for the Mercado District.
It’s not just the parking situation, which was what he was formally objecting to at a Tucson City Council meeting Nov. 5.
It’s the whole 77-unit project by OZ Development at 115 S. Linda Ave. — the first in the district west of downtown that is being developed without him and his business partner, Jerry Dixon.
“They have a three-story walk-up apartment complex to be constructed within a large, massive, mixed-use, transit-oriented development with five- and six-story, elevator-conveyed buildings, all with underground parking,” Weinstein told the council. “It is a completely inappropriate use of that parcel. That parcel is able to support up to 120 units of density.”
He also noted the new developers will need access to a private road that his company owns, and said his company is “not going to provide a written approval for this developer to modify our private road.”
115 Linda Ave apartments, street view looking west.
But what was missing in Weinstein’s comments was a recognition of his own role in that 0.67-acre parcel, at West Congress just west of the Sentinel Plaza Apartments, slipping away and being developed by someone else. A 2023 lawsuit led to an arbitrator’s judgment against Weinstein and Dixon’s companies in 2024. And that led to the property being put into receivership and sold off.
Now, another lawsuit by that same investor has led to one of their signature projects, The Monier, being put into receivership. And a separate lawsuit has been filed by an LLC associated with Holualoa Companies.
Oh, and Weinstein and Dixon are both facing 20 felony charges in a criminal case against them handed up by a federal grand jury in Phoenix on April 8. Each faces one count of conspiracy to commit wire fraud, one count of wire fraud, one count of conspiracy to commit money laundering and 17 counts of transactional money laundering, each for a separate payment.
Adam Weinstein
The prosecutor alleges in a court filing that Weinstein went on a “$200,000 spending spree,” including “a purchase at Hermes, expensive Louis Vuitton and Tumi luggage, high end hotels in New York and the South of France, ski trips in Vail, CO and Taos, NM.”
Weinstein and Dixon have pleaded not guilty and are fighting the charges, as they fight to keep control of the Mercado District.
A firm hired by Gadsden to review its finances, called Goar Investigations LLC, reported, "Based on a review of nearly a decade of Gadsden's financial transactions spanning multiple community projects, these transactions represent authorized distributions to company members and legitimate operating expenditures."
“Gadsden firmly maintains its innocence regarding the allegations brought forward by AWS,” the partners said in a statement. “We believe these claims are entirely without merit and are not supported by sufficient evidence of any wrongdoing.”
‘Public market district’
Dixon, Weinstein, and Kira Dixon-Weinstein — who is Adam Weinstein’s wife and Jerry Dixon’s daughter — have been developing the broad, previously vacant acreage south of West Congress and west of the Santa Cruz River for about 20 years.
Their new urbanist vision was of a “public market district” with architecture that reflects Tucson’s history, and dense development that allows for pedestrian- and transit-oriented living.
Progress has been excruciating at times, occasionally leading to conflicts with the city and business partners, as the Star has documented over the years. In 2016, for example, the city of Tucson removed itself from its financial ties to the development after repeated missed deadlines, and the Rio Nuevo district bought out the city’s interest.
Construction continues on the Bautista apartment complex near the MSA Annex, 267 South Avenida del Convento.
But progress did happen. Sentinel Plaza senior apartments, the Mercado San Agustin, the MSA Annex and The Monier are complete and have increasingly attracted people as residents and as customers of the many local businesses there.
The Bautista, a huge apartment development along the Santa Cruz, is nearing completion. It will have 256 apartment units and 16,000 square feet of commercial space, costing more than $100 million to build.
I’ve long thought that people could fairly fault the execution of the Gadsden Co.’s plans, but not the vision. That vision has finally been coming to beautiful fruition.
Goodwill, and indictment
This visible, enjoyable progress, along with regular political donations, have won the developers significant goodwill around Tucson. But goodwill doesn’t hold much sway in court, and that’s where Dixon and Weinstein have been finding themselves increasingly over the last couple of years.
The court proceedings are complicated and have been covered in detail by The Arizona Republic, in stories run in the Star’s pages. The highlights are this:
— In 2023 investor Kelly Sands, through his company AWS Opportunity Funds I, sued the Gadsden Co., alleging that Weinstein and Dixon fraudulently mishandled $3.375 million that Sands’ company invested in a plan to develop apartments at 115 S. Linda Avenue.
— Later in 2023, Sands, though another company, IB New Ventures, alleged that the Gadsden partners failed to make due interest payments or pay back a loan related to The Monier development. The two cases were later consolidated into one.
— In February 2024, a receiver was appointed to handle the property at 115 S. Linda Avenue, later selling it to OZ Development.
— In July 2024, arbitrator James Marhle found in the case over the Linda Avenue property, “AWS has proven by clear and convincing evidence that Gadsden, acting through Weinstein and Dixon, committed acts of fraud.” He ordered Gadsden to pay AWS $3.375 million plus $1 million in punitive damages.
— In April 2025, a Phoenix grand jury charged Weinstein and Dixon in the 20-count indictment.
— In May 2025, Judge Jeffrey Bergin appointed a receiver to take over operation of The Monier.
— In June 2025, KC Lillian Court, an LLC owned by Tucson-based Holualoa Cos., sued Gadsden, with which it had partnered to develop the property just west of the Mercado, at 885 W. Congress. They alleged Gadsden improperly paid itself more than $1 million in a fee and loan, something Weinstein and Dixon deny. The two sides have agreed to pursue mediation and a settlement.
Fighting on several fronts
Weinstein, Dixon and their attorneys are fighting it all, especially the disposition of 115 S. Linda Ave. Their attorney, Dennis Wilenchik, said in a written statement that the whole theory of fraud brought by Sands’ side is internally contradictory. He also noted that Sands entered the deal to obtain tax benefits in a Qualified Opportunity Zone, but didn’t ultimately qualify.
“So, all of this is a predicament of his own making,” Wilenchik said. “He got bad advice from his tax advisors, and the project stalled because he pulled out of it. He does not appear to want to be repaid, as efforts to do so have been rejected or prevented. Instead, he seems to want to exact some kind of pound of flesh.”
That doesn’t, of course, necessarily explain why federal prosecutors saw fit to bring the same acts before a grand jury, or why the grand jury found probable cause Dixon and Weinstein had committed crimes. It also doesn’t explain the decisions to put Gadsden properties in receivership, or the subsequent lawsuit by Holualoa’s LLC.
Weinstein and Dixon have pushed ahead trying to regain control of 115 S. Linda Ave. and The Monier. After OZ Development entered into a purchase agreement for 115 S. Linda Ave. at a cost of $1,575,000, the Gadsden Co. tried to convince a judge to reopen the sale and allow them to buy it for $1,775,000. But the other parties wanted to see evidence they actually had the money.
OZ attorneys called the whole idea “ludicrous” in an Oct. 1, 2024, court filing.
“This is not some underdog that needs saving,” they said of Gadsden. “These are actual, adjudicated fraudsters, trying to either chase away any real purchase or sell some bogus argument to the court.”
Judge Wayne Yehling denied Gadsden’s request to reopen the sale two days later.
Conflicting visions?
The fights go on. Gadsden has chafed at the receiver’s management of The Monier, noting in a court filing projects such as new signage that hasn’t been completed and marketing that is going undone.
Two business owners I spoke with at The Monier said not much has changed since the receiver took over. But one noted that he signed up for the Gadsden vision, and he worries about a different owner taking this building in a different direction.
“It would matter if this one pocket in the district wasn’t managed by the same people,” said Eric Fletcher, at Minimal Mae children’s store, who also has a photography shop at the MSA Annex across the street. “I’d really like one ownership.”
That underlying issue, I suspect, also motivated Weinstein to show up at the council meeting, arguing that OZ Development’s parking plan shouldn’t go through. Control of the broader district that has been their life’s work is at play.
But there are bigger issues playing out as well, that ought to take precedence. Like avoiding conviction and even a possible prison sentence for fraud or money laundering.
