ERBO Properties’ disclosure statement hearing scheduled for June 28

By Sarah Lizee

Olympia, Wash., May 17 – ERBO Properties LLC’s disclosure statement hearing is scheduled for June 28, according to a notice filed with the U.S. Bankruptcy Court for the Southern District of New York.

The company filed a plan of reorganization and the related disclosure statement on Monday, as previously reported.

As background, ERBO owns property at 541-545 West 21st Street, New York. The property was primarily used as storage space for many years, but in 2018, the company decided to redevelop the property into an office building.

The company filed bankruptcy in February to avoid a Uniform Commercial Code (UCC) sale of the property directed by lender G-4 18190, LLC to foreclose on its collateral.

The plan is premised upon the debtor completing construction of the property and marketing and selling the property either vacant or leased no later than 24 months from the effective date.

From the sale proceeds, all holders of allowed claims asserted against any of the debtors will be paid the full amount of their allowed claims, plus applicable post-confirmation interest.

Specifically, holders of administrative claims will be paid in full in cash.

The NYC secured tax claim will be paid in full in cash with statutory interest. All real estate taxes incurred after the effective date will be paid when due.

The G-4 secured claim will be paid in full in cash plus simple interest at a rate of 7% per annum from the effective date until paid. G-4 will retain its lien on the property to the same extent and priority as existed on the petition date. Any deficiency claim held by G-4 will be treated as a general unsecured claim.

Holders of valid mechanics liens against the property will be paid in full in cash without interest.

The SME secured claim will be paid in full in cash with 10% post-effective date interest.

Priority tax claims will be paid in full in cash with statutory interest.

Holders of general unsecured claims will be paid in full in cash without interest.

Equity interests will be retained by holders. Holders won’t receive a distribution unless the property is sold for a price greater than the amount of the allowed claims in the classes above.

The New York-based property owner filed bankruptcy on Feb. 13 under Chapter 11 case number 23-10210.

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