Basically, everyone but your cat is in Chapter 11 bankruptcy protection and she'll probably file by the end of the week. The Los Angeles Business Journal reports that Meruelo Maddux Properties Inc. has filed for Chapter 11 bankruptcy protection for 705 W. Ninth Street, that under-construction green rental tower that is supposed to be finished this year. Meruelo Maddux Properties filed for Chapter 11 protection earlier this year, but had assured everyone this tower would be completed and not affected by the larger Chapter 11 filing. And it was just in July that developer said he would announce a "new residential project in South Park in the next few months." Wouldn't get too excited about that one. Meanwhile, the LABJ reports the investors were surprised.
"The Sept. 3 bankruptcy filing caught lender Canyon Capital off guard. 'We are very surprised at the timing. We are disappointed that it occurred,” said Bobby Turner, managing partner of Canyon Capital Realty Advisors. He declined to comment further because of legal concerns. Canyon Capital is in a position to take possession of the property if Meruelo Maddux cannot reorganize the LLC."
· Meruelo Maddux Project Files Chapter 11 [LABJ]