|By Mark Basch, The Florida Times-Union,
JacksonvilleMcClatchy-Tribune Regional News
March 28, 2011--The owners of the Sawgrass Marriott Golf Resort & Spa lost one battle in U.S. Bankruptcy Court last week but did get an extension of time to file their Chapter 11 reorganization plan.
U.S. Bankruptcy Judge Paul Glenn denied a motion by the two Irish investment partnerships that own the Ponte Vedra Beach resort, RQB Resort LP and RQB Development LP, to reduce the value of the property. But with the owners facing an April 8 deadline for filing their plan to reorganize their debt, Glenn said he would approve a motion by the owners to extend the deadline to at least May 23.
RQB filed for a Chapter 11 bankruptcy reorganization in March 2010 and has been waiting for Glenn's rulings on the property's value before filing a debt restructuring plan. RQB bought the Sawgrass Marriott for $220 million in 2006 and still owed $193 million to its lender, Goldman Sachs, when it filed for bankruptcy.
The value of the property has fallen along with other real estate values in recent years and after a hearing in December, Glenn ruled that the resort should now be valued at $132 million. That means RQB would have to come up with a reorganization plan that pays Goldman Sachs $132 million.
But after that ruling, RQB went back to court arguing that the value should be reduced even more. RQB said the $132 million included the value of 450 golf memberships in the Tournament Players Club at Sawgrass Inc. The PGA Tour's golf club is not part of the Sawgrass Marriott resort, but the hotel has a partnership with the golf club that allows access to its courses. RQB said in court filings that while the Sawgrass Marriott has the right to sell those 450 golf memberships, they don't yet exist, so they shouldn't be included in the value of the resort. Therefore, it argued that the resort should be valued at most at $114 million.
After a hearing in February, Glenn last week denied RQB's motion and left the value at $132 million.
Because Glenn's ruling came so close to the deadline for filing its reorganization plan, RQB said it needed more time. Stephen Busey, a Jacksonville attorney representing RQB, said Monday that owners remain confident that they will be able to file a plan by the new deadline.
Under U.S. Bankruptcy Court regulations, RQB has the exclusive right to file a plan to reorganize its debts until the deadline set by Judge Glenn. If it doesn't file its plan by then, Goldman Sachs or another creditor can submit their own reorganization plan to the court.
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