Seaboard Realty LLC and Certain of its Affiliates File a Chapter 11 Bankruptcy

Dec 14, 2015, 10:08 ET from Seaboard Realty LLC

STAMFORD, Conn., Dec. 14, 2015 /PRNewswire/ -- Seaboard Realty LLC and certain of its affiliates yesterday filed petitions with the United States Bankruptcy Court for the District of Delaware seeking protection under Chapter 11 of the United States Bankruptcy Code. 

Seaboard and its affiliates own a portfolio of first class commercial real estate in Stamford, Connecticut, including office, residential and hotel properties.  All operations are expected to continue as normal throughout this process.

The Chapter 11 filing includes Seaboard Realty LLC and a number of affiliates it manages, which own the equity of subsidiaries that directly own the properties, but does not include the property-owning subsidiaries themselves.

Seaboard Realty LLC is owned by John DiMenna, Thomas Kelly and William Merritt.  Mr. DiMenna actively managed the Seaboard operations as the managing member of Seaboard Realty LLC, and managed the properties owned by its affiliates through a property-management company owned solely by Mr. DiMenna. 

Recent events caused Messrs. Kelly and Merritt to become increasingly concerned that the operations and finances of the company were not as they had been represented to be by Mr. DiMenna.  As a result, they then engaged sophisticated professional advisors, including retaining Dechert LLP as counsel and directing the accounting firm of Anchin, Block and Anchin as forensic accountant.  

In the last few days, Messrs. Kelly and Merritt concluded that immediate additional steps needed to be taken to protect the value of the enterprise for all stakeholders.  Mr. DiMenna agreed to resign voluntarily from having any managerial or decision-making role in each of the entities, thereby terminating his authority to represent or act for Seaboard Realty or any of its affiliates.  Marc Beilinson of Beilinson Advisory Group was retained as Chief Restructuring Officer.  Messrs. Kelly and Merritt are also in the process of appointing an independent manager to join them on the board of Seaboard Realty and its subsidiaries.    

As the investigation into the company's operations, accounting and financing continues, and after discussion with the various lenders to the enterprise, management will determine if or when Seaboard Realty affiliates that directly own Seaboard's properties should also file for bankruptcy. 

"The Seaboard properties are among the most sought after collection of office, residential and hotel assets in Fairfield county, and the Courtyard is one of the top-performing Courtyards in the country," Mr. Beilinson said. "I expect the properties to operate without interruption through this process, so that tenants and guests are not impacted.  Our goal and expectation is that the properties can be restructured or sold in an orderly fashion that maximizes recoveries for all stakeholders, including lenders and investors." 

"I will be contacting the lenders immediately and hope to be able to work collectively with them to maximize recoveries," Mr. Beilinson said.

SOURCE Seaboard Realty LLC