Luxurious Exile

At the Marines' Camp Lejeune in North Carolina, many a leatherneck's family has been living for months in cramped trailer quarters. For exercise they can stroll out to stare wistfully at 123 Marine houses that for nine months have needed only a day's work to make them ready for occupancy. At Nike villages in Texas, families have been prevented from joining their missilemen for nine more months for lack of housing. At Grand Forks Air Force Base in North Dakota, the winter winds whip through the half shells of some $11.3 million in unfinished, abandoned housing projects--preventing the transfer of a B-52 squadron there. At Beale Air Force Base near Marysville, Calif., some 400 incomplete military houses are rotting under the winter rains, while servicemen commute from towns miles away.

All this is a result of what happened when the roof caved in on the U.S. building empire of Hal Braxton Hayes. He was the superbuilder who once put up a house in 34 minutes, a bachelor who made millions, the fiance who gave Zsa Zsa Gabor a 45-carat diamond (which she uncharacteristically returned when their two-month engagement ended), the flamboyant party giver who once was the premier playboy of the Western whirl.

Unpaid Bills. The founder and sole proprietor of what he liked to claim was the world's largest individually owned construction company, Hayes had contracted to build some $60 million in housing projects at U.S. military bases. Last spring, when some of his subcontractors began to complain about money owed them. Hayes called an abrupt halt to all the work on projects yet uncompleted (TIME, June 6). On the sites, virtually nothing has happened since. Not only are there unfinished houses, but huge piles of lumber and other building materials are being ruined by the winter weather.

The Senate has already investigated the Hayes debacle, heard Air Force Housing Division Colonel Guy Goddard testify: "I think Hayes's work can be characterized as top quality. His main problem is that he does not pay his bills." The Capehart military housing bill, under which Hayes's contracts were let, has no provision to get the work started again. When work first stopped, the Continental Casualty Co., which underwrote Hayes's performance bond, offered a sensible solution.

It paid off some $6,500,000 of Hayes's debts on completed work, offered to finish the rest of the houses if somebody would guarantee to pay for them.

The Red Tape Thickens. Thanks to the snarl of red tape, nobody would-- or could. The Defense Department had no authority. The FHA, which represented the U.S. in the deals, could step in only if Hayes's mortgagers would let them. The lenders, who stood to lose money if they substituted their mortgages with Hayes for lower-interest FHA debentures, refused. Continental, now suing and being sued by Hayes, is still willing to do the jobs, but insists that someone will also have to pay for the rotted materials and the many weather-soaked houses that may have to be rebuilt from the ground. Says a Continental lawyer: "It's a mess, the most god-awful mess you ever saw. Nobody knows how to get those projects going again."

While a House subcommittee is getting ready to make another inquiry into the Hayes affair, Hayes himself has been living safely out of legal range in Mexico, calmly explains that "because of my civil lawsuits I have found it necessary to work out of the country." When the roof be gan to cave in on him last spring, Hayes mortgaged all his California properties --including his $600,000 Hollywood home -- for $1,000,000 in cash. The loan is now in default.

The Baths Multiply. Despite the ruins at home, for Hayes it is empire building as usual in comfortable exile. In Acapulco he has built the 400-seat La Mira Fire God nightclub illuminated by burning barrels of fuel oil. It is jampacked every evening. He is building a 100-ft.-long concrete boat powered by six B-29 airplane engines "to go 100-300 miles an hour." But his grandest project is a $2,000,000, 20-story "guesthouse" for himself, which sounds more like a resort hotel, perched on the edge of an Acapulco cliff. When completed, the 145-room terraced tower will have 88 baths, 15 kitchens, 42 living rooms and three swimming pools--one cantilevered out over the Pacific. Party-loving Builder Hayes has 500 men working around the clock on his house (though work has temporarily stopped pending a sanitation permit). To astounded Acapulcans, as one remarked, it looks exactly like "the building of the Tower of Babel as conceived by Cecil B. DeMille."

And while the sun shines in Acapulco and Hayes makes hay, the winds still blow around the deserted Marine houses in North Carolina, the 400 unfinished Air Force homes in California, the stark remains of $11 million worth of abandoned housing in North Dakota.

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