Misery Index: Week of June 5, 2017

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PacerMonitor’s look back at this week's most compelling bankruptcies.

Curtain Closes on Historical Off Broadway Theatre in Manhattan

The Pearl Theatre Company Inc. sought chapter 7 protection in the Southern District of New York after 33 seasons of Off-Broadway performances. According to a statement on the theatre’s website, the company could not navigate the economic reality of operating in a crowded field of worthy causes. Chairman of the Board Patricia S. Marshall signed the petition, which listed up to $500,000 in liabilities and $50,000 in assets.

Real Estate Managed by Author of Wealth Books Opens Chapter 11

Citing a foreclosure action that was filed prematurely, Moorings Regency LLC claimed up to $50 million in assets and liabilities. The chapter 11 petition was signed by Managing Member Barry Spencer, author of the 2013 book The Secret of Wealth With No Regrets. The single asset real estate entity owns three commercial office buildings in Hillsborough County, Florida, as Tenants in Common (TIC) with affiliates Griffin Regency LLC and NJO Regency LLC which also filed bankruptcy pleadings in the Middle District of Florida. According to court documents, Moorings Regency owes some $29.4 million to Wells Fargo Bank.

Read the Moorings Regency case management summary here

After Triple Shooting, River House Bar & Grill Cooks Up Bankruptcy Case

Portabella’s Inc. sought safety from up to $10 million in liabilities in the Middle District of Pennsylvania. The chapter 11 pleading was signed by President Justin L. Nicholson who rebranded Portabellas as the River House Bar & Grill where, on May 30, 2017, three people were reportedly shot by a gunman. Portabellas Inc. initially went bankrupt in 2014 after borrowing against future receivables at a discount from Rapid Advance but the payback rate was so substantial that it became a financial trap, according to court documents.

Read Portabella’s 2014 bankruptcy disclosure statement here

Joe’s Crab Shack Owner Claws Its Way Into Bankruptcy Proceedings

Citing declining sales and income, Ignite Restaurant Group Inc. listed up to $500 million in assets and liabilities in a petition signed by CEO Jonathan Tibus that was submitted to the Southern District of Texas. Some 10 affiliates filed on the same day, June 6. The group employs an estimated 8,400 workers, owes some $7,245,264.90 to PFG Customized Distribution, operates 112 Joe’s Crab Shack, LLC, according to court documents.

 Read the declaration of Mr. Tibus here.

End of Medicare Provider Agreement Leads to Dallas Hospital’s Closure

After shutting its doors abruptly last week, Walnut Hill Physicians’ Hospital LLC filed a chapter 7 petition in the Northern District of Texas. Signed by CEO Cory Countryman, the hospital is claiming up to $50 million in assets and $500 million in liabilities. According to media reports, the Medicare provider agreement between the hospital and the Secretary of Health and Human Services terminated on June 1 in accordance with provisions of the Social Security Act.

Maryland School Lands in Financial Despair After Property Dispute

The Washington McLaughlin Christian School Inc. sought shelter from debt in the  District of Maryland. The petition, signed by President Dr. Pauline Washington, claimed up to $50,000 in assets and $10 million in liabilities, which includes $650,000 owed to the U.S. Department of Housing and Urban Development (HUD). The school is a defendant in a 2016 lawsuit over a property dispute in which HUD’s Secretary Julian Castro is also named.  

 Read about the Fairview Investment Fund lawsuit against the school here

 Mortgage Default Ends in Bankruptcy for Westchester Restaurant and Realty Firm

Due to a pending foreclosure, Grace Church Realty Corp. filed chapter 11 pleadings in the Southern District of New York followed by affiliate Grace Church Restaurant Corp. Claiming up to $10 million in assets and liabilities, both petitions were signed by President Juan Cepeda who was named in a lawsuit filed by Cathay Bank for some $1.2 million.

 Philly House of God Asks House of Law for Creditor Mercy  

Gethsemane Outreach Ministries sought chapter 11 protection in the Eastern District of Pennsylvania, claiming up to $10 million in assets and liabilities. Signed by Pastor Lionel Parson, court documents disclose the church was unable to pay its debts as they mature.

 Read Mr. Parson’s declaration here

Regions Center Office Building in Arkansas Continues its 2016 Descent

NNN 400 Capital Center LLC in Little Rock sought chapter 11 relief along with 31 affiliates in the District of Delaware. The bankruptcy comes on the heels of a 2016 defaulted foreclosure notice filed by Wells Fargo Bank. Signed by Manager Heidi Duncan, the petition lists up to $50 million in assets and liabilities. Existing indebtedness includes a promissory note related to a $32 million loan dated August 18, 2006, according to court documents.

Read consultant Lori McGhee’s declaration here

 

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