LINWOOD - The city's largest commercial center and ratable, generating more than $800,000 in city property tax last year, is scheduled for foreclosure sale next month.
Cornerstone Commerce Center, a 250,000-square-foot retail and corporate complex on New Road across from Mainland Regional High School, has been dealing with financial issues for the past few years. The foreclosure filing lists its debt at nearly $50 million.
Tenants of the center, which includes Rissy Roo's designer dress shop, the FAA Technical Center, the Atlantic County Women's Center and more, said they were aware of the facility's financial situation but were unaware of the depth of its problems.
Signs announcing the projected foreclosure sale were posted throughout the corridors of the facility about three weeks ago, said Christine Harashinski, a state title officer with Stewart Title Co., which has an office in the complex. But Harashinski said the signs were taken down within a few hours.
"We were saying we wish we had made copies of it," she said.
Next to the title company at the Women's Center, an employee said that she, too, had heard about the pending auction, but didn't know any additional details.
The property manager referred all questions to Onyx Equities LLC, the District Court of New Jersey appointed receiver of the property. Onyx Equities didn't return calls and messages last week. A message left Wednesday for Robin A. Karman, the managing partner of Cornerstone's parent company, Delaware-based CCC Atlantic LLC, also was not returned.
In December 2012, CCC Atlantic filed for Chapter 11 bankruptcy protection. U.S. Bankruptcy Court documents filed then showed the company owed more than $400,000 to its 20 largest unsecured creditors, which included law firms, building contractors, landscapers and office cleaners. Karman also said in a statement then that the decision to file for bankruptcy protection was a temporary move while the business reorganized.
The company listed assets and liabilities of more than $10 million but less than $50 million.
The development company had also been engaged in prolonged negotiations with the city of Linwood over its interest in expanding its footprint with new commercial space. Delays in completing the projected expansion, coupled with vacancies caused by the recession and a 2008 national real-estate collapse, contributed to the company's financial turmoil, Karman said then.
In February, the company and its receiver filed a motion for summary judgment and reconsideration with Wells Fargo Bank, NA, as trustee for the registered holders of Credit Suisse First Boston Mortgage Securities Corp. Its motion was denied by the U.S. District Court for the District of New Jersey and a foreclosure sale was scheduled for 11 a.m. May 13.
The auction will seek to recoup outstanding debt of $49.7 million, plus interest and costs since the February ruling.
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