Midlands developer Kahn faces creditors in court
06/10/2013 9:45 PM
06/11/2013 12:18 AM
Creditors owed millions of dollars by Columbia businessman Alan Kahn met him in court Monday for the first time since the developer filed for Chapter 11 bankruptcy protection earlier this year.
Kahn, 73, noted developer of the sprawling Village at Sandhill commercial and residential complex in Northeast Richland, and two of his two real estate companies, Kahn Family LLC and Kahn Properties South LLC, could owe up to 50 creditors as much as $250 million, according to documents filed with the U.S. Bankruptcy Court.
Kahn filed for bankruptcy protection in April, at the time saying he had been working with 10 creditors to satisfy debts when one took legal action that would have placed that creditor in front of all others. Kahn said then that would be unfair to the other creditors and would interfere with his attempts to work out the payment issues in good faith.
After Monday’s meeting, he has until Oct. 21 to file a plan with the court to begin repaying all of his creditors.
Over the course of 21/2 hours, Kahn, aided by his attorney, Geoffrey Levy of Columbia, answered questions posed by court trustee Linda Barr and a few of his creditors about Kahn’s financial status, property holdings and business conduct and his future plans.
Kahn and his accountants turned in reams of documents to the court, detailing complicated business and financial transactions and loans, some loans from family members and for family interests. For instance, Kahn owes three notes to his sister, which are covered among the bankruptcy filings.
At one point Kahn’s sister went into her retirement account to loan him $1.5 million, Kahn said, as TD Bank predecessor Carolina First “exerted great pressure” for him to pay down a $25 million loan three years ago, at a time Kahn said he “didn’t have any cash to speak of.”
Chapter 11 bankruptcy allows a debtor to reorganize or liquidate pursuant to a submitted plan approved by the court.
Kahn has said the Village at Sandhill is not involved in the bankruptcy.
Columbia attorney Frank Knowlton, questioning Kahn about his individual liabilities on behalf of Wells Fargo, showed sympathy for the developer, whom supporters say was blindsided by the Great Recession.
“Mr. Kahn, you and I know each other and our families go back a long ways,” Knowlton said, “so I’m sorry to see you here under these circumstances.”
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