Chapter 11 filed by Wisconsin developer, Michael Dilworth
On behalf of Kerkman & Dunn
posted in Chapter 11 on Friday, November 15, 2013.
A prominent real estate developer in Milwaukee, Wisconsin, has filed for Chapter 11 bankruptcy protection.
Michael Dilworth, who is the president of Ener-Con Cos, has been responsible for the redevelopment of commercial buildings and condos in Milwaukee.
However, when BMO Harris Bank
refused to extend business loans that were close to expiring, the Chapter 11 bankruptcy was filed.
According to the bankruptcy filing, Dilworth
has up to $105.1 million in liabilities, but assets of only $32.7 million.
The reorganization effort by Dilworth
is not expected to affect some developments in progress, such as the Greenfield Highlands condos.
In addition, Ener-Con Cos
and other businesses that Dilworth
owns or operates are not listed in the Chapter 11 filing.
Many developers in the Milwaukee area have run into the same problem when it comes to attempting to restructure their bank loans.
Regulators have pressured the banks to re-evaluate loan restructuring because of the significant drop in property values due to the recession.
acquired Dilworth's loans from Marshall & Ilsley Bank
after purchasing the troubled bank.
has spent the last couple of years trying to get the loans restructured, but to no avail.
is not done with BMO Harris
Hudson has petitioned the court to allow them a right to pursue collection efforts against Dilworth
These actions are delayed automatically, though, during bankruptcy in order to give debtors a chance to reorganize.
Hudson claims that Dilworth
"acted in bad faith" when he
transferred collateral before the bankruptcy.
Dilworth denies the allegations.
Chapter 11 bankruptcy help businesses reorganize and come out of bankruptcy strong and ready to move forward.
There is little doubt this is the plan after Dilworth's bankruptcy; however, he
could face additional issues over the above loans.
Source: jsonline.com, "Milwaukee-area developer Michael Dilworth files for Chapter 11" Tom Daykin, Nov. 09, 2013