【破产新闻】Bankrupt South Carolina Coastal Resort Goes Back to the Lender

Aug 30, 2017   By John McDermott

 

The lender for the shuttered Melrose Resort on Daufuskie Island will acquire the failed property after fending off an unexpected last-minute rival bid at a U.S. Bankruptcy Court sale on Wednesday.

 

A federal judge said he will approve the ownership transfer to Odeon Singapore Ltd. Affiliated with a Netherlands-based maker of sausage casings, the firm has sunk more than $27.5 million into Melrose.

 

Odeon was able to use that debt to bid on the 420-acre seaside property and take title to it. It set the minimum sale price at $19 million in June and had hoped to sell it to another buyer, said its attorney, Michael Weaver.

 

 

A Charleston real estate firm was retained to solicit competing offers, but no qualified proposals were submitted before the deadline last week.

 

At a 90-minute hearing in Charleston, Judge John Waites court rejected an 11th-hour plan by a group called Opportunity Fund that was seeking to buy out the shares held by the bankrupt owners for $15 million. Its plan was filed with the court Tuesday night.

 

As of Wednesday, the would-be buyer had only lined up $2 million. Its attorney asked for a 30-day extension.

 

Waites denied the request, saying time was critical given the deteriorating state of Melrose.

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"It's too little, too late," he said.

 

Future plans for Melrose have not been disclosed. Odeon representative Arie Zoller of Chicago-based LVH Partners told several Daufuskie residents after the hearing that the new ownership group would be responsive to their concerns.

 

Zoller, who described himself as "the man on the ground" for Odeon, told The Post and Courier that the buyer "absolutely" plans to stabilize its decaying investment.

 

The idled property includes an inn, conference center, rental cottages, marina and a Jack Nicklaus-designed golf course. Built in the mid-1980s and accessible only by boat or ferry, it occupies a prime spot on Calibogue Sound, across from Hilton head Island.

 

Melrose has never quite lived up to its financial expectations.

 

The resort went bankrupt in 2009 under previous owners who blamed the economic “chaos” created by the unfolding financial crisis and other challenges.

 

Melrose has mostly languished since then. It has no employees or revenue sources.

 

Attorneys Rick Mendoza and Ron Jones, who represent the Utah firms that bought Melrose at a 2011 auction for $13 million, said a planned overhaul required more money and time than originally anticipated.

 

Odeon has been trying to seize control of the Beaufort County resort since 2014, when it filed a foreclosure lawsuit.

 

A courthouse auction scheduled for earlier this year was scrubbed the day before, after the Utah borrowers halted all legal proceedings by filing for bankruptcy protection.

 

Contact John McDermott at 843-937-5572 or follow him on Twitter at @byjohnmcdermott

 

Source:

http://www.postandcourier.com/business/bankrupt-south-carolina-coastal-resort-goes-back-to-the-lender/article_57387336-8d8c-11e7-a341-df7ceb701a86.html

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