2018 Year In Review: 1. Hammons’ asset transfer approved in $1B settlement

SBJ file photo

LEGACY SHIFT: Seven downtown Springfield properties, highlighted above, were among the assets shuffled around in the two-year bankruptcy case.

SPRINGFIELD, FEB. 13–The corporate empire that John Q. Hammons built in the end fell into the hands of his largest creditor.

A landmark settlement Feb. 13 in U.S. Bankruptcy Court gave Jonathan Eilian and his J.D. Holdings LLC the rights to buy the remaining assets in the Hammons estate. The court’s approval of a $1 billion asset purchase for John Q. Hammons Hotels & Resorts’ 35 hotels and nearly 150 other assets came five years after Hammons died and two years after JQH Hotels officials filed for Chapter 11 bankruptcy protection. JQH Hotels CEO Jacquie Dowdy and general counsel Greggory Groves were operating as trustees of Hammons’ estate.

In his career, Hammons developed over 200 hotel properties across 40 states, according to the bankruptcy filings, and was known in Springfield for such landmarks as Hammons Tower, Hammons Field baseball stadium, the Missouri Sports Hall of Fame and Highland Springs Country Club. But the portfolio had begun to diminish as multiple court decisions mounted against the company, primarily led by Eilian and another of his companies, Atrium Hospitality LP.

Now, Atrium Hospitality manages the former JQH Hotels properties, management and staff.

But at the time of the settlement, Dowdy said in a company statement, “This is a historic day as we celebrate coming to a satisfactory agreement with Mr. Eilian to ensure that Mr. Hammons’ legacy can properly live on. I look forward to working with Mr. Eilian on a smooth transition that leverages JQH’s award-winning, performance-oriented qualities.”

In the months following, multiple objections were filed in the case – by the city of Springfield, Missouri State University and a group of creditors with claims exceeding $750 million in defaulted debt – but the bankruptcy judge sustained the Eilian settlement plan and it was confirmed by the court on May 11. Also, the court awarded J.D. Holdings a nearly $500 million claim against all associated debtors, relating to Eilian’s work to help Hammons privatize JQH Hotels in 2005.

The court plan also established a new Hammons charitable trust, supported by $20 million from J.D. Holdings. The trust assumed the ground lease with the city for Hammons Field, as well as MSU’s license to play there and the stadium lease to the Double-A Springfield Cardinals.