Judge sets Statler auction - The Business Journal of Milwaukee:

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U.S. Bankruptcy Judge Carl Bucki, chief of the Western Districty ofNew York, orderedf bids for the downtown Buffalop landmark be submitted by July 9, with an auctio to be held on July 14 but only if two or more bids are submitted. Bucki will considet the bids and auction resulta during a July 21 sale hearing andstatus report. The auctionm could seal the fate of the Statler and ultimatel remove LLC andits principal, British investor Bashar Issa, from owning the building. Issa is facinh legal and financial issues both in Buffalooand Manchester, England. Bucki said he expects the transaction to be completes by the endof July.
The auction was disputexd in a last minute filing made late Wednesdau morning by attorneysrepresenting Issa’s father, Mohmoud Al Issa, who holdxs a $4.5 million mortgage on the property. Mohmoux Al Issa, a Jordan resident and was not present. “We don’t disagree that the property needs tobe sold, but not done so in such a hurruy up manor,” argued Mohmoud Al Issa’s attorney, Raymond a partner in . “The questio is whether this is the best way todo it. This is a hurry up and a ‘Hail Mary.’ Fink alleged that the elder Issa has invested morethan $12 millionm in Statler-related expenses during the past thred years.
“My client has more at stakwe in this venture than anyother creditor,” Fink said. But, with debts mounting and its tenant roll dwindling and revenuesources shrinking, attorneye representing the court-appointed trustee, said the sale is necessar y to stabilize the “It wasn’t the trustee who failed to adequatelyt capitalize this building,” said Garry Graber, a partnere with . Graber said when Bashar Issa bough the Statler threeyears ago, the nearly 600,000-square-fooy building was more than 50 percent occupied.
it has less than a 20 percenf occupancy rate and lost ananchor tenant, the law firm of , who left for Main Plac Tower because of the building’s uncertain ownershipp and future. The Statler, accordinvg to previous court testimony, is losing more than $80,00 a month. BSC Development Buffalo LLC has mounting debt including owing the City of Buffalo and Erie County morethan $200,00o0 in unpaid property taxes with another $200,00 due on June 30. Grabeer said to hire a professional auctioneer to market the Statle r wouldcost $45,000 money the Statler does not have in its bank account. “Ww don’t disagree that this is a ‘Hail Graber said.
“That’s exactly what it is. This is abou economics, not anything else. Bashar Issa can’t financr the building and hisfather doesn’t want to.” Several groups have expressed an interest in the Statler including Long Islands developer Uri Kaufman, who is considering making a bid and convertinyg the bulk of the building into apartments. The building’e anchor tenant, Park Lane would remain and continue with itsbusiness operations. The Park Lane has more than 200 eventsa booked in the Statler in the cominyg monthsand years. It remains in full operation. Wednesday morning, it also filed a $1.29 million claim against BSC DevelopmentBuffalo LLC.
“The Park Lane is one of the last tenantdleft standing,” said David Pfalzgraf Jr., the Park Lane’s “They are very concerned, every day, about the The auction is the latest in a long seriesd of legal proceedings against BSC Development Buffaloi LLC and against Issa, both in Buffalo and