Stephen Church and John Gittelson | Bloomberg
The developer of one of the largest homes ever built in the United States, with a moat and a 30-car garage, has filed for bankruptcy to keep lenders from foreclosure in Los Angeles.
The mansion, dubbed “The One,” was being developed by Crestlloyd LLC when a fight broke out with lenders, including Hankey Capital. According to court documents, the creditors went to court in Los Angeles, claiming they were not paid. In the end, a manager was appointed to lead the project.
Crestlloyd “believes that the recipient has obstructed efforts to complete the property, as well as bring to market, display and sell the property in its current state,” the bankruptcy court file said.
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Ted Lanes, the court’s appointed governor, declined to comment on Wednesday.
“I’m disappointed,” said Don Hankey, who specializes in subprime car finance, filed for bankruptcy. “All we want is to get our capital back.”
Hankey, who has loaned more than $ 82.5 million for the project, has scheduled a buyout sale on Wednesday.
Real estate developers sometimes use bankruptcy as a way to prevent lenders from foreclosure. Under Chapter 11 rules, litigation, including state foreclosure claims, is terminated to allow the company to reorganize and pay off its debts.
The One is worth about $ 325 million, but Crestloyd said in court filings that he has only $ 176 million in secured loans. Even if the property sold for half of its original $ 500 million price tag, Crestlloyd said, there would still be enough money to pay off all the debts.
Lanes planned to sell the house for $ 225 million. The 105,000-square-foot (9,750-square-meter) main building – nearly twice the size of the White House – has four swimming pools, a two-story waterfall, a nightclub, a movie theater, a four-lane bowling alley, and a beauty salon. , spa, gym and cigar salon.
Case – Crestlloyd LLC, 21-bk-18205, United States Bankruptcy Court, Central District of California (Los Angeles).