The future of a massive Midlothian real estate development and its financial condition are slowly becoming clearer as the project plods through a bankruptcy reorganization.
The Chapter 11 reorganization of Roseland Village LLC, an entity that owns about a quarter of the 1,300 acre Roseland mixed-use development stalled by the real estate downturn, is attracting attention from multiple parties.
Bruce Arkema, an attorney with DurretteCrump representing the debtor, said discussions are in progress on three fronts to move Roseland Village forward: finding a buyer for the entire entity, finding buyers for individual lots or sections or finding financing so the original owners can keep the project going.
“I think there’s progress on all fronts,” Arkema said. “There has been interest in the property and the project by large national players. And it’s no secret there are letters of intent floating around for some lots.”
Roseland Village filed for Chapter 11 in mid-January after it said its lenders decided not to renew the financing tied to the project. (You can catch up in the original RBS story here.)
The latest bankruptcy documents also shed more light on the financial side of Roseland Village. The 343 acres of land tied to project is currently worth about $42.9 million, according to the filings.
Locally-based Franklin Federal Savings Bank is the creditor on 313 of those acres, currently valued at about $37.4 million, according to filings. Around $15 million is owed on that section of the property, according to Arkema, leaving substantial equity.
BB Hunt LLC, which shares an address with local developer HH Hunt, is a creditor on another 30 acres, valued at about $5.5 million.
Franklin Federal, which is in the process of going public (read more about that here), is the lead lender on the project, though it was a participation loan involving various other lenders, according to Arkema.
Having equity helps take some of the pressure off, but that doesn’t mean the lenders aren’t anxious to get their money back, Arkema said.
“Franklin Federal is like every other bank where regulators are coming in and saying ‘you have a non-performing loan, what are you going to do with it?’” Arkema said.
Roseland Village also owes $220,000 in back taxes to Chesterfield County and $1.1 million to GBS Holding, an entity tied to George “Buddy” Sowers, the developer of the entire Roseland development. GBS owns 50 percent of Roseland Village LLC, according to the bankruptcy documents.
Emails and a phone message left for Casey Sowers of GBS were not returned by press time.
Roseland Village was given a deadline by the bankruptcy court to file its reorganization plan by April. However, Arkema said they are pushing for an extension.
And according to a monthly operating report included in the bankruptcy filings, Roseland Village was not generating any revenue.
The hope, Arkema said, is that one or more of the potential scenarios outlined will get inked before any official plan must be filed with the bankruptcy courts.
“I think it’s a little too early to tell. But they are working diligently to find some way to get out of it.”
The grand plan for Roseland – unveiled before the real estate crash – and was to include more than 5,000 homes, more than 1 million square feet of office and retail space, and a town center.
According to the Roseland website, homes there sell from less than $200,000 up to multimillion-dollar estates. The plan also called for rental properties, including penthouse condominiums in Roseland’s Old Town.
Michael Schwartz is a BizSense reporter. Please send news tips to [email protected].
The future of a massive Midlothian real estate development and its financial condition are slowly becoming clearer as the project plods through a bankruptcy reorganization.
The Chapter 11 reorganization of Roseland Village LLC, an entity that owns about a quarter of the 1,300 acre Roseland mixed-use development stalled by the real estate downturn, is attracting attention from multiple parties.
Bruce Arkema, an attorney with DurretteCrump representing the debtor, said discussions are in progress on three fronts to move Roseland Village forward: finding a buyer for the entire entity, finding buyers for individual lots or sections or finding financing so the original owners can keep the project going.
“I think there’s progress on all fronts,” Arkema said. “There has been interest in the property and the project by large national players. And it’s no secret there are letters of intent floating around for some lots.”
Roseland Village filed for Chapter 11 in mid-January after it said its lenders decided not to renew the financing tied to the project. (You can catch up in the original RBS story here.)
The latest bankruptcy documents also shed more light on the financial side of Roseland Village. The 343 acres of land tied to project is currently worth about $42.9 million, according to the filings.
Locally-based Franklin Federal Savings Bank is the creditor on 313 of those acres, currently valued at about $37.4 million, according to filings. Around $15 million is owed on that section of the property, according to Arkema, leaving substantial equity.
BB Hunt LLC, which shares an address with local developer HH Hunt, is a creditor on another 30 acres, valued at about $5.5 million.
Franklin Federal, which is in the process of going public (read more about that here), is the lead lender on the project, though it was a participation loan involving various other lenders, according to Arkema.
Having equity helps take some of the pressure off, but that doesn’t mean the lenders aren’t anxious to get their money back, Arkema said.
“Franklin Federal is like every other bank where regulators are coming in and saying ‘you have a non-performing loan, what are you going to do with it?’” Arkema said.
Roseland Village also owes $220,000 in back taxes to Chesterfield County and $1.1 million to GBS Holding, an entity tied to George “Buddy” Sowers, the developer of the entire Roseland development. GBS owns 50 percent of Roseland Village LLC, according to the bankruptcy documents.
Emails and a phone message left for Casey Sowers of GBS were not returned by press time.
Roseland Village was given a deadline by the bankruptcy court to file its reorganization plan by April. However, Arkema said they are pushing for an extension.
And according to a monthly operating report included in the bankruptcy filings, Roseland Village was not generating any revenue.
The hope, Arkema said, is that one or more of the potential scenarios outlined will get inked before any official plan must be filed with the bankruptcy courts.
“I think it’s a little too early to tell. But they are working diligently to find some way to get out of it.”
The grand plan for Roseland – unveiled before the real estate crash – and was to include more than 5,000 homes, more than 1 million square feet of office and retail space, and a town center.
According to the Roseland website, homes there sell from less than $200,000 up to multimillion-dollar estates. The plan also called for rental properties, including penthouse condominiums in Roseland’s Old Town.
Michael Schwartz is a BizSense reporter. Please send news tips to [email protected].
I am a resident in the Bel Crest development off Winterfield Road. Roseland is the developer in this community as well. The developer owns the majority of the land in the two phases of the community, and has a few homes currently under construction as well as some pending contracts on future homes to be built in this neighborhood. Being the primary stake holder in this development that is also shared with the original builder of the project Bel Arbor builders, Casey Sowers is the president of the HOA of this community. The majority of his building activity has come… Read more »
Get ready to be screwed Bel Crest residents…………………this happens all the time when developers lose money, they get out quick and eventually move away. Sue now and get in line! There is more to this story then this article makes anyone believe.
I stand corrected. Mr. Buddy Sowers phoned me today, to say that he is the primary stakeholder and owner, in the Bel Crest and Bel Bridge development’s on the corner of Winterfield and Robious Roads and not his son Casey. Who does however, “head up” the HOA of these developments. I suggest that Buddy get into the discussion and explain the breakdowns and ownership of the various LLC’s with which he and his sons are involved.
Ms. Schweitzer – Wouldn’t it have been easier and more informative to have called our office or reached out in any way before you sat down and posted in order to get your facts correct? Perhaps you could write, call, send an e-mail, fax or even stop by our office next time you feel the need to talk. I am sure some of your neighbors can attest to our willingness to go above and beyond our responsibilities as developer of your neighborhood to help them in times of need. Additionally, your community manager is available 7 days a week to… Read more »
Mr. Flannigan – For the record, Roseland Village LLC, which is the subject of the story, is not the developer of Bel Crest or the Winterfield project. That entity is Riverton Associates, which has been involved in the development of the Winterfield Rd. / Rt. 711 corridor for nearly 20 years. It is hardly a “get out quick” entity, and has endured its share of recessions. It is the same entity that sold land to Chesterfield for James River high school and Bettie Weaver elementary, partnered with Eagle Construction to build the first waterfront park in the County, negotiated with… Read more »
Bravo to you Casey for speaking up and addressing these comments which were premature and baseless. Too many people are using these forums to post false information that is based upon misinformation or just factless assumptions. The worst part is that far too many people believe these rants without researching them first.
Perhaps you should take another look at the real estate signs that line the streets of the Bel Crest and Bel Bridge communities. Roseland is the only name on any of the signs. There is no mention of Riverton Associates. Whether it is your self, your father or your brother, by any other name…it seems it is all still in the Roseland family. Efforts have been made to contact your offices. And I honestly believe there to be mostly empathy toward your situation. I believe that I corrected the only mistake that I made in my email. And with all… Read more »