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A group of creditors are asking the bankruptcy court to allow for the collection of attorneys’ fee related to a loan for Chateau on the Lake, above, and others.
Photo courtesy Chateau on the Lake
A group of creditors are asking the bankruptcy court to allow for the collection of attorneys’ fee related to a loan for Chateau on the Lake, above, and others.

Creditors file appeal after JQH bankruptcy plan approved

Posted online

A $1 billion bankruptcy deal between JD Holdings LLC and late hotelier John Q. Hammons’ trust was approved, but court proceedings are not yet complete.

A group of creditors yesterday filed a notice of appeal, five days after the bankruptcy plan was approved on May 11, according to court documents.

Collectively known as commercial mortgage-backed securities lenders, the creditors also filed a supplemental document asking the District of Kansas court to allow for the collection of “oversecured” claims, according to court documents. The claims in question are attorneys’ fees incurred by the CMBS creditors between April 19, 2016, and Feb. 18 of this year. 

The attorneys’ fees total $1.2 million, according to court records.

Of those fees, $279,207 are related to a loan for Chateau on the Lake in Branson. In 2016, a nearly $45 million loan for the Branson hotel was transferred to Midland Loan Services as a special servicer in the bankruptcy court proceedings, according to past Springfield Business Journal reporting.

The other loans cited involve Goldman Sachs, Barclays and Nomura, according to the supplemental document.

The May 11 approval of the deal allows JD Holdings, the largest creditor in the JQH bankruptcy case, to move forward with its purchase of the trust’s assets. JD Holdings owner Jonathan Eilian showed he had $200 million “readily available for liquidation,” as well as a $1 billion loan to make the purchases.

The deal comprises nearly 150 assets, including JQH Hotels & Resorts’ current portfolio of 35 hotels, such as Chateau on the Lake and University Plaza Hotel & Convention Center in downtown Springfield.

The deal includes a nearly $500 million award to JD Holdings against all associated debtors, according to court records. The award is related to Eilian’s work to help Hammons privatize his company, according to SBJ reporting.

The CMBS creditors objected to that claim during the course of the bankruptcy proceedings, saying the plan and settlement “go beyond a settlement of the differences between (JD Holdings) and the debtors, and seek impermissibly to fundamentally alter the rights of creditors on shortened notice.” The court rejected this claim.

The bankruptcy plan also established a new Hammons trust, which assumed the lease for Hammons Field, as well as other agreements related to the development, ownership and operation of the Springfield baseball stadium. The trust also agreed to transfer the Missouri Sports Hall of Fame property to the nonprofit of the same name that operates it.

Under the terms of the deal, Eilian’s Atrium Hospitality LP will assume management of the Hammons hotels.

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