The owners of a mall in another state recently filed for bankruptcy protection. The Chapter 11 bankruptcy filing took place on a Friday. Bankruptcy filings may be helpful for companies in Massachusetts and other states that are facing financial challenges.
In the out-of-state case, the mall owners who filed for bankruptcy claimed that its lender cut off funding it had promised for renovations. The bankruptcy filing puts an immediate stop to a foreclosure legal suit that the lender recently filed against the mall. The lender alleged that the owner of the mall was behind on its payments for the more than $42 million loan it had taken out.
According to the mall’s bankruptcy documents, the owner actually stopped making payments after learning that the lender was not representing details regarding the renovation plans accurately. Still, the bank alleged that the mall owner mismanaged the property and did not pay the taxes it owed. Following the bankruptcy filing, the mall is slated to stay open and to keep pursing new shops as well as a brand new hotel and additional major improvements.
Company owners in Massachusetts sometimes end up having more liabilities than assets, and they see no way of getting over the mountains of debt in front of them. In these situations, filing for Chapter 11 bankruptcy may be immensely helpful, as it allows a company owner to reorganize his or her business. Legal guidance may help people to navigate this complex legal process in a manner that will ultimately benefit them and their businesses long term.
Source: orlandosentinel.com, “Fashion Square Mall files Chapter 11 bankruptcy to block foreclosure“, Paul Brinkmann, Jan. 6, 2017