Lenders seeking to foreclose on Town Square

A group of lenders is asking a bankruptcy judge to remove an obstacle to foreclosure on Town Square, a combination retail and office center that opened on the eve of Southern Nevada’s real estate crash.

The Bank of Nova Scotia, New York Agency, on Tuesday filed a motion asking the judge in the Lehman Bros. Holdings’ bankruptcy case to allow it to foreclose on the project.

The bank leads a group of lenders that made a $449 million construction loan to one of the Turnberry family of real estate development companies.

Lehman, the giant investment banking company that failed in 2008, also made a loan to the Town Square developers.

“This filing is not a surprise, nor is it new,” Mike Wethington, general manager of Town Square Las Vegas, said in a statement.

“Our lenders filed their initial foreclosure action last summer, and we have continued to discuss a resolution with them. Those talks are ongoing,” he said. “The Bank of Nova Scotia filed this action in the Lehman Brothers bankruptcy case simply to protect its interest in the mall. The financial negotiations taking place have no effect on the daily operations of Town Square and do not reflect the shopping center’s performance.”

A brother and sister, Jeffrey and Jacquelyn Soffer, control a majority interest in the Turnberry companies, which own Town Square.

The siblings opened the project in November 2007 on Las Vegas Boulevard South between Sunset Road and the Las Vegas Beltway. It contains 900,000 square feet of retail space and 250,000 square feet of office space.

The bankruptcy court motion claimed that the construction loan has been in default since March 2009. Despite comments to the contrary from Turnberrry, negotiations to restructure the loan have “broken down,” according to the motion,

An appraisal in May 2010 estimated the market value of the mall at $415 million, $34 million less than the amount owed on the construction loan, according to the motion.

The bankruptcy judge, however, has an “automatic stay” in the case preventing foreclosure on a $95 million loan made by Lehman. Turnberry is suing Lehman based on claims that the company promised but failed to make a $625 million loan to refinance the construction loan and the $95 million Lehman loan.

In its motion, the Bank of Nova Scotia said it believes the Lehman loan was used to fund equity investments in Town Square and other entities. The Bank of Nova Scotia argues that Lehman has no property interest in Town Square.

The project’s office space is 90 percent vacant, compared to an average vacancy rate of 25 percent in the Las Vegas market, said John Stater, research manager of Colliers International. Turnberry said the retail space has 13 percent vacancy.

The lenders face good prospects for selling Town Square to a new owner. “We’re starting to see more buyers come into the market,” Stater said.

Some buyers want to buy distressed real estate at deep discounts but others will pay “a fairly good price” for high-quality, fully leased retail centers, the analyst said.

Contact reporter John G. Edwards at
jedwards@reviewjournal.com or 702-383-0420.

ad-high_impact_4
Business
The Mansion at MGM boasts hidden luxury
The Mansion at MGM, a hotel within a hotel, features 29 luxury villas for invited guests only. (K.M. Cannon/Las Vegas Review-Journal)
Goodwill of Southern Nevada
Under CEO John Helderman, Goodwill of Southern Nevada has expanded its services including the new home of Goodwill’s Veteran Integration Program. Free job services are paid for by revenues generated by Goodwill's retail stores. In 2017, the sale of donated goods allowed Goodwill of Southern Nevada to train more than 17,000 job seekers. More than 2,500 of those found local jobs. (Las Vegas Review-Journal)
Little bat company on verge of MLB deal
Larry Thein, part owner and one of only three employees of the Tat2 Bat Company of Davenport, Iowa, made the company's first bat in a hog barn. He spoke of the humble origins during a trade show at the Baseball Winter Meetings in Las Vegas, Nev., on Dec. 12, 2018. (Ron Kantowski/Las Vegas Review-Journal)
Texas Roadhouse opens in North Las Vegas
Texas Roadhouse has opened at on Craig Road at Bruce Street in North Las Vegas as part of an emerging "restaurant row." (K.M. Cannon/Las Vegas Review-Journal)
Holiday Parade Lights Up Downtown Summerlin
Holiday parade lights up Downtown Summerlin every Friday and Saturday night through Dec. 22.
Nevada's solar industry on the rebound
In 2015, the Nevada Public Utilities Commission voted in favor of a new tariff structure that reduced net energy metering buyback rates and increased fix fees for residential solar customers.
Apartment complexes selling fast in Las Vegas
Las Vegas’ apartment vacancy rate is among the smallest in the country, and rents are climbing faster than the national average. (LVRJ)
Aristocrat Opens $45M Campus In Summerlin
Aristocrat Technologies Chairman Ian Blackburne discusses the company's growth. (LVRJ)
Sunrise Hospital celebrates 60 years
Sunrise Hospital opened its doors to patients on Dec. 15, 1958. Employees of more than 35 years celebrated at a luncheon Wednesday, Dec. 12, 2018. Jessie Bekker/ Las Vegas Review-Journal.
Maya Cinemas to open soon in North Las Vegas
Moctesuma Esparza, CEO of Maya Cinemas, talks about the newest location in North Las Vegas, set to open Jan. 10. The aim of the theatre chain is to serve latino-centric, underserved communities.
Holiday shopping and returns make this the busiest time of year for UPS
The UPS Las Vegas South facility is the company's busiest pre-load operation in the country, and it's even busier this time of year. (K.M. Cannon/Las Vegas Review-Journal)
Primm’s outlet mall has fallen on hard times
The mall, attached to Primm Valley Resort, opened in 1998. Back then, it was a “textbook, perfect outlet-center location." But now, Primm’s outlet mall has fallen on hard times. Las Vegas Boulevard has endless shopping spots. And there are other outlet malls that don’t require a hefty drive to the state line. Its mortgage-holder foreclosed on the mall in late September.
Miltary auction at Ritchie Bros. Auctioneers
Humvees, ammo cans, construction equipment, field gear and more is on the auction block Friday and Saturday at Ritchie Bros. Auctioneers. About 10,000 items in all are for sale in what GovPlanet bills as the largest auction of its kind.
Las Vegas residents discuss avoiding holiday scams
Las Vegas residents discuss their donation habits and how they avoid giving money to scam charities during the holiday season. (Bailey Schulz/Las Vegas Review-Journal)
Tesla’s Nevada Gigafactory ahead of economic impact expectations
The Tesla Gigafactory’s economic impact on Nevada has exceeded projections, bringing in more than 7,000 jobs. In 2014, Nevada agreed to give the automotive and energy company $1.3 billion in tax abatements. In return, Tesla promised to meet certain requirements in areas like employment and capital investment. As of June, Tesla has brought in a total of $6.05 billion in capital investment, surpassing the $4.95 billion projection. The original contract gave the company until 2024 to make $3.5 billion in capital investments in Nevada. Derek Armstrong, deputy director of the Governor’s Office of Economic Development.
Land sales near the Las Vegas Raiders stadium
Land around the Las Vegas stadium site has been selling for high prices. A few months before the stadium’s groundbreaking, Global Trust Group acquired a 2.5-acre parcel just north of the stadium site. The property sold for $7.25 million, or $2.9 million an acre. Osprey Real Estate Capital and Huntington Hotel Group acquired a 2-acre industrial site just west of the stadium site in late November. The property sold for $6.5 million, or $3.15 million per acre. That's roughly 12 times the average price of land in the valley this year as tracked by Colliers International.
T-Mobile Tech Experience Truck parks in Toshiba Plaza at T-Mobile Arena
The Tech Experience Truck is a state-of-the-art showroom on wheels, with demonstrations that put connected drones, smart cities, augmented/virtual reality and smart tracking. The exhibit shows new wireless technology – including 5G and the Internet of Things (IoT). (K.M. Cannon/Las Vegas Review-Journal)
Steve Siegel, CEO of the Siegel Group, speaks about helping families and other needy residents
Steve Siegel, CEO of the Siegel Group, speaks about helping families and other needy residents to keep them from teetering off into homelessness. Bizuayehu Tesfaye/Las Vrgas Review-Journal @bizutesfaye
Crowds camp out for Chick-fil-A opening
Dozens of customers camped out 24 hours ahead of the 6 a.m. Thursday opening of the new Chick-fil-A on Rainbow Blvd.
Cheapest listings for sale in Las Vegas
Listed for $39,990, 585 S. Royal Crest Circle, Unit #9 is one of the cheapest homes currently listed for sale in Las Vegas. (Caroline Brehman/Las Vegas Review-Journal)
MGM's sports betting deals
MGM Resorts International signed a sports betting sponsorship agreement with the NBA in July It was the first professional sports league to have official ties with a legal sports betting house. The deal came just two months after the U.S. Supreme Court overturned a law prohibiting sports betting in most states. In October, MGM became the first gaming company to sign a sports betting partnership with the NHL. In November, MGM became the first gaming company to sign a sports betting partnership with the MLB. Financial terms of Tuesday’s deal and earlier partnerships have not been announced.
Terry Miller discusses Convention Center
Project Manager Terry Miller explains the phases of Convention Center construction.
Zappos treats their team members on Cyber Monday
Zappos rolls out a variety of food, drinks and special activities for all team members at their downtown Las Vegas headquarters for Cyber Monday. (K.M. Cannon/Las Vegas Review-Journal)
Team Hybrid at the 2019-Model Motor Trend International Auto Show
Among the companies showing off the 2019 model cars, Team Hybrid shows off its modified cars. Las Vegas resident David David talks about the team, which is in its ninth year exhibiting at the show, and his show car.
Black Friday Shoppers at downtown Summerlin and at the Arsenal
Black Friday shoppers at downtown Summerlin and at the Arsenal. Bizuayehu Tesfaye/Las Vegas Review-Journal @bizutesfYe
Black Friday shopping in Las Vegas
Black Friday sale shopers express their shopping experience. Bizuayehu Tesfaye/Las Vegas Review-Journal @bizutesfaye
Las Vegas Livestock recycling Strip food waste
Las Vegas Livestock collects and recycles food from many Las Vegas Strip companies. (Nicole Raz/Las Vegas Review-Journal)
Black Friday at Fry's
Shoppers line up for deals early on Black Friday at Fry's Electronics on Las Vegas Boulevard South. (Mat Luschek/Las Vegas Review-Journal)
Black Friday shoppers at Best Buy at 5 am
Black Friday shoppers at Best Buy at 5 am on Nov. 23. (Mat Luschek/Las Vegas Review-Journal
Black Friday - 1am Closing Time
Quiet night.
TOP NEWS
News Headlines
ad-infeed_1
ads_infeed_2
Local Spotlight
Home Front Page Footer Listing
Circular
You May Like

You May Like