Bishop’s Lodge owner makes pre-packaged Chapter 11 bankruptcy filing

By Sarah Lizee

Olympia, Wash., Aug. 30 – BL Santa Fe, LLC, which owns the Bishop’s Lodge resort in Santa Fe, N.M., made a pre-packaged Chapter 11 bankruptcy filing on Monday in the U.S. Bankruptcy Court for the District of Delaware.

Michael Norvet, president of BL Sante Fe, said that the debtor’s only potential income producing asset is the resort. Although construction on the resort is still ongoing, a soft opening was completed on July 1 with 30 rooms.

The company experienced financial difficulties during the extensive construction project, which precipitated the Chapter 11 filings, Norvet said.

The debtor has two primary senior creditors, DB Bishops Lodge LLC and mezzanine lender Juniper Bishops, LLC. As of Monday, about $40.98 million was owed to DB Bishops and $35.97 million was owed to Juniper Bishops.

On Sunday, the company entered into a restructuring support agreement with the lenders to implement the pre-packaged Chapter 11 plan of reorganization.

The plan restructures the obligations owed to DB Bishops and resolves the obligations owed to Juniper Bishops.

In short, the plan provides for 100% of the membership interests in BL Santa Fe to go to Juniper BL HoldCo, LLC, a wholly owned subsidiary of Juniper Bishops. In return, the mezzanine loan will be satisfied in full, Juniper BL HoldCo will finance the completion of the resort and renovations and its operations, the mezzanine borrower, BL Santa Fe (Mezz), LLC, will receive the economic entitlement to receive from Juniper BL HoldCo some back-end distributions from resort operations and/or disposition, and the senior loan will be restructured.

Under the plan, administrative expense claims, professional fees, mezzanine lender debtor-in-possession claims, senior lender DIP claims, senior lender expenses and tax claims will be paid in full.

All general unsecured claims will be paid in full or reinstated.

DIP financing

Juniper Bishops has agreed to provide up to $5.86 million of superpriority senior secured loans to the company. The company is seeking interim access to $2.92 million of the facility.

If the DIP facility is fully funded, another $2.64 million additional senior DIP loan may be provided to the company by DB Bishops.

The loan from Juniper Bishops would have a 10% exit fee, while the loan from DB Bishops would have a 1% exit fee.

The company is also seeking to use the cash collateral of its pre-petition secured lenders.

Other details

The company listed $50 million to $100 million in both estimated assets and estimated liabilities.

No unsecured creditors were listed with claims of $1 million or more.

The Santa Fe, N.M.-based hotel owner filed Chapter 11 bankruptcy under case number 21-11190.

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