Bankrupt project.

A downtown high-rise being built by troubled developer Meruelo Maddux Properties Inc. will move forward despite the project's bankruptcy, the company maintains.

Meruelo Maddux-845 S. Flower Street LLC, a legally separate entity that controls the 705 W. Ninth St. development, filed for Chapter 11 protection Sept. 3. But the building will be complete next month and ready for occupancy in November, said company spokesman Michael Bustamante.

"The market continues to be a difficult place and things did not turn as quickly as we'd like," he said. "It was unfortunate but the appropriate thing to do."

Meruelo Maddux has secured three deposits for leases and is current on payments to the lender, an affiliate of Century City real estate investment manager Canyon Capital Realty Advisors LLC, Bustamante said.

According to the bankruptcy filing, the limited liability corporation's 20 largest unsecured creditors, mostly contractors, are owed more than $7.5 million.

The filing follows Meruelo Maddux Properties' own Chapter 11 bankruptcy petition in March after it was unable to make payments on $266 million in debt. The company is likely to file a reorganization plan in November.

Bobby Turner, managing partner of Canyon Capital, declined comment because of legal concerns.

One-bedroom apartments at the 214-unit property start at $2,248 per month and penthouse units begin at $6,800.

Staff reporter Daniel Miller can be reached at [e-mail] or (323) 5495225, ext. 263.