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the court found the over-secured creditor was judicially estopped from asserting value different from the value it had previously proposed and was accepted by the plan proponents. Nonetheless, the court adjusted the value of the properties with an 8% reduction for real estate professional fees and extended time to market the properties. The court denied confirmation of the proposed plan but stated that it would approve without a hearing an amended plan filed in accordance with its opinion.
xiv. In re Marble Cliff Crossing Apartments, LLC, 486 B.R. 887 (Bankr. S.D. Ohio 2013)
Issue: Whether single asset real estate (SARE) debtor's 32-year plan was feasible and was "fair and equitable" to the mortgagee.
Holding: The court held that the SARE debtor's 32-year plan was not feasible and was not fair and equitable to the mortgagee. The court held that the SARE debtor's property suffered from a methane gas problem that would require remediation work and would detrimentally affect its value and marketability, as well as the debtor's ability to obtain refinancing. In addition, the debtor failed to show any realistic loan commitments and capital investments, rendering the plan unconfirmable as not feasible. The court also found the plan was not fair and equitable to the fully secured mortgagee because it essentially required the mortgagee to make a new 32-year loan, which was not available in the market place at the interest rates provided by the plan. The court denied confirmation of the debtor's plan.
xv. In re GAC Storage Lansing, LLC, 485 B.R. 174 (Bankr. N.D. Ill. 2013)
Issue: Whether the debtor limited liability company met the requirements for plan confirmation. Whether the secured creditor was entitled to stay relief.
Holding: The bankruptcy court denied confirmation on various grounds and awarded the objecting secured creditor stay relief. The debtor owned storage unit buildings. The secured lender objected to the debtor's plan on various grounds. The court found that the plan was not feasible because, among others, its expert's testimony lacked data supporting that the debtor would be able to refinance at the end of the plan term to pay a balloon payment to the objecting secured lender. The court also found the debtor's projections were uncertain because of the area of the storage facility and its proximity to a competitor. Also, based on expert testimony and the methodology used, the court found that the secured creditor's proposed interest rate of 8.2% adequately captured the risks that the secured creditor faced under the plan, as opposed to the debtor's interest rate of 4.61%. The court also found the debtor's disclosures lacking because the disclosure statement did not provide the financial information of the proposed tenant of the real property collateral and did not provide sufficient information about the reorganized debtor's management structure. Additionally, the court found that, though he was the partial owner through an interest held by a family trust of the current sole member of the debtor, the new
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