NEW YORK -- 560 Seventh Avenue Owner Primary LLC, the operator of the Margaritaville Resort Times Square, has filed an amended disclosure statement detailing its proposed Chapter 11 reorganization plan. The plan, filed on February 3, 2025, in the U.S. Bankruptcy Court for the Southern District of New York (Case No. 23-11289), outlines a comprehensive restructuring strategy centered around a $140 million loan extension with OWS CRE Funding I, LLC.
The 234-key hotel, which opened in July 2021 amid challenging post-pandemic conditions, seeks to restructure approximately $150 million in secured debt. Under the proposed plan, represented by law firm Cozen O'Connor, the debtor would make an initial cash payment of approximately $9.37 million to OWS, reducing the outstanding loan balance to $140 million. The restructured loan would be interest-only for two years, with two one-year extension options.
The plan includes settlements with key creditors, including a $4 million payment to Garment Center Congregation, the hotel's largest unsecured creditor, and provisions for handling claims from DHG TSQ, LLC and Flintlock Construction Services, LLC. General unsecured creditors would share a $1 million pool if their class votes to accept the plan.
AC MVTS Holdco, LLC, the current owner following a December 2023 UCC foreclosure sale, has agreed to contribute over $30 million to fund the plan, including waiving its $23.9 million administrative claim. The plan maintains the property's REIT structure through a proposed operating lease arrangement.
A confirmation hearing is scheduled for March 18, 2025, at 10:00 a.m. before Judge Philip Bentley.
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Link: Amended Disclosure Statement With Respect to Second Amended Chapter 11 Plan
Document length: 183 pages