Real estate concerns file a spate of bankruptcies.At least five of the filings involve more than $10 million During the last three months, downtown Los Angeles' Central District of California federal bankruptcy court bankruptcy court n. the specialized Federal court in which bankruptcy matters under the Federal Bankruptcy Act are conducted. There are several bankruptcy courts in each state, and each one's territory covers several counties. has seen a surge in petitions filed by real estate operations with $10 million or more in assets and/or liabilities. The rash of petitions for Chapter 11 protection -- which allows a company to continue operating while clearing up its obligations -- seems to reflect financial pressures on many Southern California Southern California, also colloquially known as SoCal, is the southern portion of the U.S. state of California. Centered on the cities of Los Angeles and San Diego, Southern California is home to nearly 24 million people and is the nation's second most populated region, income-property owners as a result of falling rents and stingy stin·gy adj. stin·gi·er, stin·gi·est 1. Giving or spending reluctantly. 2. Scanty or meager: a stingy meal; stingy with details about the past. capital markets. Landlords are frequently finding that rental revenues do not cover expenses and mortgage debts, and many have also been unable to refinance short-term loans coming due. And damages from the Jan. 17 earthquake have put additional pressure on some owners. Data culled from five recent petitions provides some insights into the types of operations feeling the financial pinch. * Walnut Properties, a real estate holding and investment company headquartered on Sunset Boulevard Sunset Boulevard is a street in the western part of Los Angeles County, California, that stretches from Figueroa Street in downtown Los Angeles to the Pacific Coast Highway at the Pacific Ocean in the Pacific Palisades. in Los Angeles Los Angeles (lôs ăn`jələs, lŏs, ăn`jəlēz'), city (1990 pop. 3,485,398), seat of Los Angeles co., S Calif.; inc. 1850. , filed an incomplete Chapter 11 petition specifying assets of about $32 million and liabilities of about $17.7 million. The petition identifies George Tate as president and sole stockholder of Walnut, which owns properties throughout California. The filing states that 17 creditors collectively hold secured debt of about $10.67 million. The largest of these are: Topa Thrift & Loan of Century City, with a claim of $2.8 million; Queen City Bank of Long Beach, claiming $2.38 million; and First Fidelity Savings & Loan of San Diego San Diego (săn dēā`gō), city (1990 pop. 1,110,549), seat of San Diego co., S Calif., on San Diego Bay; inc. 1850. San Diego includes the unincorporated communities of La Jolla and Spring Valley. Coronado is across the bay. , $2.08 million. Petition "comments" note Walnut's current income is not quite sufficient to meet current expenses, and the debtor has been involved in several lawsuits causing further "extraordinary expenses." The comments also indicate a creditor who obtained a judgment against Walnut has attempted to tie up all the debtor's assets, "disrupting the ability to operate his business." * Downtown L.A.-based La Canada Flintridge Development Corp., which does business as LCF LCF - Logic for Computable Functions Group, LCF Property Group and LCF Management Group, filed an incomplete Chapter 11 petition listing assets totaling about $9.68 million and liabilities totaling nearly $24.6 million. The secured portion of the "real estate development and business management" firm's debts are specified at about $8.6 million, of which $2.35 million is disputed. Gilbert Dreyfuss, who had been general partner in the City of Commerce Radisson Hotel before lender Sumitomo Bank of California The Bank of California was founded in San Francisco, California on July 5, 1864 by William Chapman Ralston. It was the first commercial bank in the Western United States, the second-richest bank in the nation, and considered instrumental in developing the American Old West. foreclosed on the property last year, is president of La Canada Flintridge Development Corp. and owns 100 percent of the stock, according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. the petition. He is also acting as the firm's attorney in the bankruptcy case. La Canada Flintridge is reportedly affiliated with the partnership that owns the early 1900s-vintage 13-story building at 311 S. Spring St. in downtown Los Angeles Downtown Los Angeles is the central business district of Los Angeles, California, located close to the geographic center of the metropolitan area. The sprawling, multi-centered megacity is such that its downtown core is often considered just another district like Hollywood or where the firm is headquartered. Bankruptcy Judge Barry Russell Barry Russell was a rugby league player who played for the Cronulla-Sutherland Sharks in the National Rugby League competition. Russell's position was in the halves and he won the Rothman's Medal in 1988. ordered that "debtor in possession debtor in possession n. in bankruptcy proceedings when a debtor has filed for the right to submit a plan for reorganization or refinancing under Chapter 11, and the debtor is allowed to continue to manage his/her/its business without an appointed trustee, that debtor " file a reorganization plan A scheme authorized by federal law and promulgated by the president whereby he or she alters the structure of federal agencies to promote government efficiency and economy through a transfer, consolidation, coordination, authorization, or abolition of functions. by Sept. 12. * Whitman-Dome Energy Corp., a privately held "real estate investments" corporation based in the Brentwood district, filed an incomplete Chapter 11 petition listing assets of about $16 million and liabilities of $17.5 million. The $14 million in secured claims, held by 400 parties, and $3.5 million in unsecured claims from 100 creditors are all listed as "disputed." Dennis B. Schmucker is identified as the firm's president with power to vote through "irrevocable proxies." The petition identifies Kipp A. Whitman and Christian Dome as "non-voting" shareholders. Directors Schmucker and Neal Singer signed resolutions authorizing the Chapter 11 filing. Petition documents provide no information about the firm's real estate assets, but do include a 64-page "master mailing list An automated e-mail system on the Internet, which is maintained by subject matter. There are thousands of such lists that reach millions of individuals and businesses. New users generally subscribe by sending an e-mail with the word "subscribe" in it and subsequently receive all new " of interested parties. * Chinatown-based 21st Dynasty Corp. recently filed an incomplete Chapter 11 petition listing assets of about $15.17 million and liabilities of $12.42 million as of last Oct. 23. The petition specifies that "disputed" secured claims total $12.32 million. A previous Chapter 11 case stemming from a petition 21st Dynasty filed last October was dismissed by Judge Geraldine Mund in March. As the Business Journal reported in December, 21st Dynasty and construction lender Sumitomo Bank of California are involved in a dispute over $12 million in financing for the Dynasty Center retail project in the Chinatown district. The previous case's petition lists holders of 5 percent or more of 21st Dynasty's stock. These include: George and Ginny Wang with 33 percent; Fong Wu with 23 percent; Goodring Investment Inc. with 18 percent; Harry Wu with 9 percent; and Satco Inc. with 6 percent. * Burbank Hill Properties Inc., a Burbank-based real estate development firm, filed a Chapter 11 petition listing assets of about $11.5 million and liabilities of $6.4 million - including $6.13 million in secured debt held by 12 creditors. A schedule of the debtor's real property refers to 88 lots of raw land in Burbank. The schedule values the debtor's interest in those lots at $8.22 million and specifies a secured claim of about $5.2 million against the lots. The schedule also mentions two other lots with unspecified values or claims. The petition notes Rockmore Corp. owns 100 percent of Burbank Hill's stock, and Burbank Hill President Sherman R. Whitmore is the sole owner of Rockmore. The biggest secured claims the petition identifies include: a $2.36 million claim from the Westlake Village office of homebuilder J.M. Peters Co.; and a $1.5 million claim from Bank of Beverly Hills Beverly Hills, city (1990 pop. 31,971), Los Angeles co., S Calif., completely surrounded by the city of Los Angeles; inc. 1914. The largely residential city is home to many motion-picture and television personalities. , with the bank's address listed as care of the Federal Deposit Insurance Corp.'s Irvine office. The petition also refers to a pending Los Angeles Superior Court "breach of contract" case - Burbank Hill Properties Inc. vs. J.M. Peters Co. - filed May 19. |
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