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Hunt resort resolves bankruptcy (Kerrville Daily Times, Texas)

By Sean Batura, Kerrville Daily Times, TexasMcClatchy-Tribune Regional News

June 07--Bankruptcy proceedings involving the 500-acre Stablewood Springs resort in Hunt recently resulted in agreement, allowing the facility to continue operating and building rental dwellings.

The resort, at 1270 Texas 39, includes the Antler Grill restaurant, swimming pools, seven miles of hiking and cycling trails, 3.5 acres of Guadalupe riverfront, a fitness center, event facilities and 24 one-, two- and three-bedroom dwellings, or "villas." Construction of additional villas is expected within months and the approximately $50 million project will eventually include 105 villas, according to Brian Tucker, president of Stablewood Springs Resort LP, which owns the resort.

The partnership filed for bankruptcy protection in December, after loans from its primary lenders went into default. A judge approved the reorganization agreement last week, and lenders and investors will close on the recapitalization plan any day now, Tucker said.

Before the bankruptcy proceedings, the partnership had roughy $19 million to $20 million in debt, but, after some debt was recapitalized as equity, the debt dropped to $7.3 million, Tucker said.

"We had too much debt on our balance sheet," Tucker said. "We had some difficulties in negotiating with our previous lenders, and we couldn't come to an agreement on how to move forward, so we felt the best course of action would be to get assistance from the court to compel the former lenders to negotiate with us, and they did, and we negotiated a good recapitalization for everyone involved."

The project's lenders are Axys Capital Total Return Fund LLC of Austin and Paul J.A. "Lex" van Hessen of the Netherlands. Under the reorganization plan, van Hessen and Axys will be repaid some money, and Alliance Capital of Cleveland will buy some of their notes. Van Hessen's claims were for almost $9.2 million and Axys' claims were nearly $2.9 million.

The partnership recently raised $5 million from Alliance Capital of Cleveland, $1.2 million from van Hessen, $1.1 million from Axys and $3 million in preferred equity from investors. Tucker declined to identify other investors, but he said they are mostly in Houston.

Representatives of Thomas A. Russell's estate, to whom the resort owed about $2.5 million, had objected to the reorganization plan. However, the partnership's largest unsecured creditor dropped its objection and agreed to take $100,000 from the partnership.

The partnership hired a new general manager to run the resort. Michael Schneider, who has managed several resorts similar in size to Stablewood, will relocate from Reno, Nev., to Hunt in mid-July, Tucker said.

"He brings an enthusiasm and a customer service focus that I think our members and our guests are really going to enjoy, as well as bring in the focus to make sure Stablewood and all of its amenities and all its infrastructure is all kept as an absolutely well-oiled machine type of operation," Tucker said. "He's a very impressive young man."

The resort was appraised at $13.5 million and $26 million in the last 12 months for lenders, Tucker said. He said the difference in these figures stems from subjective valuations, including whether the operation can function without the threat of liquidation for the foreseeable future and how much profit the project is expected to generate in the future.

Tucker said the partnership's marketing analysis projected future annual revenues for the resort of $12.5 million, and a low-end estimate was $6 million to $8 million.

Stablewood has been open for six years, and the bankruptcy proceedings never closed the resort, said Tucker.

"It's been open for business the whole time," Tucker said. "In fact, our rentals have gone up over 20 percent from last year, and our restaurant is full almost every night it's open."


(c)2013 the Kerrville Daily Times (Kerrville, Texas)

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