The Parachute Factory, an apartment redevelopment project by Billy Jefferson and Justin French, is nearing an auction. Photo by Katie Demeria.
One of the final pieces of an imprisoned local developer’s real estate empire is hitting the auction block.
Billy Jefferson’s Parachute Factory Apartments at 300 Decatur St. in Manchester is scheduled for a foreclosure auction on May 29. A Jefferson-controlled entity defaulted on a $15.2 million loan on the property almost two years ago.
The property was built in 1937 and renovated through a historic tax credit rehab in 2006. Jefferson, who is serving 20 years in federal prison for a tax credit scam, partnered on the project with Justin French, another notorious Richmond developer now serving time for similar crimes.
The three-story building sits on 2 acres and houses 95 apartment units and 75,000 square feet of office space on the ground floor. It’s one of Jefferson’s last remaining substantial real estate assets in the city.
The owner of the loan on the property is U.S. Bank, the same lender that forced an auction on Jefferson’s River City Renaissance portfolio, which consisted of hundreds of apartments around the Fan and Museum District. They were recently acquired by a company out of Boston.
U.S. Bank has been pushing toward foreclosure on the Parachute Factory since early 2014. It sought to have the building turned over to a receiver in order to prevent its value from further deteriorating until it was able to work through foreclosure proceedings. The court appointed CompassRock Real Estate to take over management of the property.
Wachovia was the original lender on the defaulted note, which has a $13.6 million balance, according to real estate tracking firm Trepp. CWCapital Asset Management is the special servicer representing U.S. Bank and initiated the foreclosure, a Trepp report states.
The trustee handling the auction is Russell Drazin of Washington, D.C.-based law firm Pardo Drazin. He declined to comment on the pending auction.
According to city records, the Parachute Factory’s latest assessment valued the property at $10.6 million, a decrease of more than $3 million since its 2014 assessment. Trepp last reported in April that the building has a 73 percent occupancy rate, an increase from its 46 percent rate in June 2014.
The Parachute Factory is the second-largest Manchester project that Jefferson will have lost to foreclosure. The 225-unit property formerly known as the Tobacco Factory Lofts was claimed at auction last year by New York-based True North Management Group.
Jefferson is represented by Hunton & Williams attorney Jack Martin and Chuck James of Williams Mullen. Neither returned requests for comment by press time. Martin recently said in an email that so far Jefferson has paid $2.5 million of his $9 million restitution.
Jefferson is in the process of appealing his 20-year sentence. He is being held in a low-security federal facility in Yazoo City, Mississippi.
The Parachute foreclosure auction is set to take place at 11:30 a.m. on May 29 on the steps of the Richmond Circuit Court.
The Parachute Factory, an apartment redevelopment project by Billy Jefferson and Justin French, is nearing an auction. Photo by Katie Demeria.
One of the final pieces of an imprisoned local developer’s real estate empire is hitting the auction block.
Billy Jefferson’s Parachute Factory Apartments at 300 Decatur St. in Manchester is scheduled for a foreclosure auction on May 29. A Jefferson-controlled entity defaulted on a $15.2 million loan on the property almost two years ago.
The property was built in 1937 and renovated through a historic tax credit rehab in 2006. Jefferson, who is serving 20 years in federal prison for a tax credit scam, partnered on the project with Justin French, another notorious Richmond developer now serving time for similar crimes.
The three-story building sits on 2 acres and houses 95 apartment units and 75,000 square feet of office space on the ground floor. It’s one of Jefferson’s last remaining substantial real estate assets in the city.
The owner of the loan on the property is U.S. Bank, the same lender that forced an auction on Jefferson’s River City Renaissance portfolio, which consisted of hundreds of apartments around the Fan and Museum District. They were recently acquired by a company out of Boston.
U.S. Bank has been pushing toward foreclosure on the Parachute Factory since early 2014. It sought to have the building turned over to a receiver in order to prevent its value from further deteriorating until it was able to work through foreclosure proceedings. The court appointed CompassRock Real Estate to take over management of the property.
Wachovia was the original lender on the defaulted note, which has a $13.6 million balance, according to real estate tracking firm Trepp. CWCapital Asset Management is the special servicer representing U.S. Bank and initiated the foreclosure, a Trepp report states.
The trustee handling the auction is Russell Drazin of Washington, D.C.-based law firm Pardo Drazin. He declined to comment on the pending auction.
According to city records, the Parachute Factory’s latest assessment valued the property at $10.6 million, a decrease of more than $3 million since its 2014 assessment. Trepp last reported in April that the building has a 73 percent occupancy rate, an increase from its 46 percent rate in June 2014.
The Parachute Factory is the second-largest Manchester project that Jefferson will have lost to foreclosure. The 225-unit property formerly known as the Tobacco Factory Lofts was claimed at auction last year by New York-based True North Management Group.
Jefferson is represented by Hunton & Williams attorney Jack Martin and Chuck James of Williams Mullen. Neither returned requests for comment by press time. Martin recently said in an email that so far Jefferson has paid $2.5 million of his $9 million restitution.
Jefferson is in the process of appealing his 20-year sentence. He is being held in a low-security federal facility in Yazoo City, Mississippi.
The Parachute foreclosure auction is set to take place at 11:30 a.m. on May 29 on the steps of the Richmond Circuit Court.