The developer of The Outpost in Poway files for bankruptcy

0


[ad_1]

The developer of The Outpost, a mixed-use project once touted as a model for the development of a pedestrian precinct along Poway Road, insists the project will be completed despite the Chapter 11 filing for bankruptcy in September.

Poway Property LP, the owner-developer of the project, filed for bankruptcy on September 13, listing debts of $ 22.9 million owed to 11 creditors and debts to a 12th indeterminate creditor, according to the filing of bankruptcy. The largest amount, $ 21 million, is owed to UC Poway Post Holder, LLC.

The developer has listed assets of $ 50,000 or less, depending on the bankruptcy filing.

While the numbers may seem daunting, attorney for the developer, David Speckman of San Diego, said the developer was determined to see the project move forward to completion.

“The project will be successful. The project is going to be back on track here shortly, ”Speckman said on Friday.

Currently, all work on the site, a 1.58 acre parcel on Poway Road, about a block west of Community Road, has ceased, Speckman said. The developer plans to hire a new general contractor once the work resumes.

The project is being developed by Poway Property LP and its general partner, the Canadian company Capexco. Trent Claughton, President and CEO of the company, spoke at a groundbreaking ceremony in August 2018 for The Outpost, calling it a “milestone” that would help establish a pedestrian downtown for the city.

To get the project back on track, the developer came up with some significant changes, Speckman said. More specifically, the promoter wishes to enlarge the residential part of the mixed-use project.

The original plan approved by the city provides for 53 residential units, a food hall, a fitness center and two floors of underground parking. As part of that plan, Speckman said residential would have accounted for 60% of the 100,000 square foot total and commercial uses would have occupied 40%.

While Speckman cannot deliver a specific number of residential units requested in the proposed new plan, he said residential will now account for 82% of the square footage, with commercial accounting for 18%. It was not immediately clear whether specific commercial uses would be changed or reduced under the revised project. The total area would remain the same.

The developer hopes to present the revised plan to Poway City Council in November, Speckman said. “We think the city would welcome” the new plan, he said.

“The owner-developer is committed to seeing the project complete,” Speckman said. Once the city approves the revised plan, he said: “Then it is expected that they will be able to organize new funding to complete the project. “

Poway Mayor Steve Vaus, who also spoke at the 2018 groundbreaking ceremony, predicting that the project will be “remembered for generations to come”, addressed a request for comment to René Carmichael , spokesperson for the city.

Carmichael said the bankruptcy filing “is a concern” and city officials are monitoring the site while construction is halted for any potential health and safety issues. However, the city’s capacity to intervene is limited because The Outpost is a private development.

Carmichael also said the proposed changes to the project are not far enough into the city’s review process to be presented to city council for consideration at a meeting in November.

According to Speckman, the underground parking lot and foundations for the project are 80 percent complete, while the overall project is about 25 percent complete.

The project, the first of its kind to be approved as part of a specific Poway Road plan update, has suffered some setbacks since construction began. In 2019, the developer announced that completion would be delayed for a year due to complications from removing more groundwater than expected during excavation.

In July of this year, a subcontractor for the project, PERI Formwork Systems Inc., filed a lawsuit against Poway Property LP, Capexco and the general contractor for the project, KD Stahl Construction Group Inc., alleging that it had failed not been paid for the concrete formwork and shoring materials he provided for the project.

Under Chapter 11 bankruptcy, a business can reorganize and restructure its debts while continuing to conduct business.

Speckman said such a reorganization is sometimes used by a company to “catch its breath,” so that it can protect its project and pay its creditors in an orderly fashion.

In this case, he said, the developer needed a break from creating a plan to pay off debts, get city approval for the proposed changes, get new funding, and complete the project.

“We are making good progress on this goal,” he said.

[ad_2]

Share.

About Author

Comments are closed.