An Ohio lender wants a Baton Rouge federal judge to greenlight foreclosure proceedings for more than $172 million against developer Tommy Spinosa’s mixed-use Perkins Rowe project.
Meanwhile, in Chapter 11 proceedings over a $25 million Spinosa apartment complex in Houston, U.S. Bankruptcy Judge Douglas D. Dodd, of Baton Rouge, has issued an ultimatum to the property’s largest creditor: Either seek a court hearing before the judge or forget a request to immediately foreclose on the complex.
In the Perkins Rowe dispute, KeyBank National Association has attempted to foreclose on the development of shops, offices, restaurants, apartments, condominiums and a movie complex at Perkins Road and Bluebonnet Boulevard for the past 23 months. The lender won an order June 7 from U.S. District Judge James J. Brady, who ruled Spinosa and some of his companies repeatedly and wrongly refused to turn over requested documents.
Brady found Spinosa and his firms in contempt of court and stripped them of their defenses and counterclaims against KeyBank.
KeyBank reported to Brady last week that Spinosa and his firms continue to withhold requested documents. The bank asked for permission to immediately take possession of Perkins Rowe or sell it at auction.
“Perkins Rowe will file an opposition,” Spinosa’s lead attorney, Mark R. Beebe, said Friday.
Also on Friday, Beebe filed a request with Brady, asking the judge for a protective order that would bar KeyBank from publicly releasing any documents that contain advice from Beebe and other attorneys to Spinosa. Beebe asked for the same protection for any documents that represent his and other attorneys’ work product.
Brady did not immediately rule on Spinosa’s request for the protective order Friday. The judge, however, ordered Spinosa to respond to KeyBank’s motion for summary judgment by July 13.
That deadline, Beebe said Friday, will be met.
HOUSTON APARTMENTS: Spinosa, a spokesman and a different set of attorneys did not respond Friday or Monday to requests for comment on the developer’s efforts to hold onto the Watermarke Apartments in Houston.
Spinosa placed the 280-unit property under reorganization protection from creditors in Dodd’s bankruptcy court in January.
That was after FST Watermarke LLC of Dallas bought a $21.3 million note owed by Beltway 8 Associates LP to Compass Bank in Birmingham, Ala. The Beltway partnership in Baton Rouge owns the Watermarke Apartments in Houston.
Beltway 8 Associates LLC, managed by Spinosa, owned one percent of the partnership when the loan papers were signed at Compass Bank on Aug. 21, 2008, court records show.
That money was borrowed just two months before Spinosa ceased making payments to KeyBank for loans granted for Perkins Rowe in Baton Rouge, records show.
University of Alabama football Coach Nick Saban owned 49.5 percent of the partnership, and the remaining 49.5 percent was held by the Spinosa Class Trust.
Spinosa, who personally guaranteed the Beltway 8 debt, has filed a plan of reorganization that would leave more than $2 million in principal and interest unpaid on FST Watermarke’s $22.2 million claim.
A court hearing on Spinosa’s reorganization plan is scheduled for September.
But FST Watermarke asked Dodd earlier this month to withdraw Beltway 8’s protection from creditors so the Dallas firm can foreclose on the 15-acre apartment complex.
FST Watermarke alleged in its request to Dodd that Beltway 8 “has no equity in the property of the estate.”
FST Watermarke added: “A (reorganization) plan is not fair and equitable unless the holder of a secured claim receives payments, the present value of which is equal to the value of the collateral.”
Last week, Dodd acknowledged receipt of FST Watermarke’s request for an end to Beltway 8’s protection from creditors. But the judge added that FST Watermarke failed to request a hearing on its motion.
Absent that request for a hearing, the judge ruled, the fate of Spinosa’s reorganization plan will be decided in September.
Attorneys for FST Watermarke were asked Friday whether the creditor will seek the court hearing that could lead to foreclosure on the apartment property in Houston. Those attorneys did not respond to the request for comment.