In this article, Adam Stein-Sapir of Pioneer Funding, LLC, provides insight into the complexities of tenant-in-common ownership in bankruptcy situations.
Article Link: https://www.bizjournals.com/philadelphia/blog/real-estate/2015/01/pending-200m-sale-of-1818-market-st-just-got.html?page=all
Summary
The planned sale of 1818 Market St., a significant office building in Philadelphia, has been complicated by the Chapter 11 bankruptcy filings of three partial owners. The building, valued at approximately $203 million, was under contract to be sold to Shorenstein Cos. Sovereign Capital Management Group, which had a majority stake, faced opposition from some fractional owners, leading to legal disputes and arbitration. The bankruptcy filings have delayed the sale process, with Sovereign hoping for a swift court resolution. Adam Stein-Sapir comments on the unique challenges presented by tenant-in-common ownership structures in such real estate transactions.
- The pending sale of 1818 Market St. for around $203 million is complicated by the bankruptcy filings of three partial owners.
- Sovereign Capital Management Group, the majority stakeholder, is entangled in legal disputes with some fractional owners over the sale.
- Adam Stein-Sapir notes the difficulties in coordinating sales when multiple owners are involved, likening it to “herding cats.”
Q&A
What are the implications of the bankruptcy filings for the sale of 1818 Market St.?
The bankruptcy filings by three fractional owners have complicated and delayed the sale of the property. Sovereign Capital Management Group must now navigate the bankruptcy proceedings and legal disputes to complete the sale to Shorenstein Cos. The situation underscores the complexities that can arise when multiple parties have ownership interests in a property.
How does tenant-in-common ownership affect the process of selling a property?
Tenant-in-common (TIC) ownership can significantly complicate the sale of a property because all owners may not agree on the sale or valuation. This can lead to legal disputes and challenges in coordinating the sale, as seen in the case of 1818 Market St. For more information on the intricacies of bankruptcy and ownership disputes, you can visit Pioneer Funding LLC’s guide on bankruptcy.
What role does arbitration play in resolving disputes among fractional owners?
Arbitration is often used as a means to resolve disputes outside of court, providing a binding decision on contentious issues such as the appropriateness of a sale or the valuation of ownership interests. In the case of 1818 Market St., arbitration initially ruled in favor of Sovereign’s right to sell, but the subsequent bankruptcy filings by dissenting owners have moved the resolution back into the court system.
