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Real estate meltdown leaves developers reeling

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It was another rough year for the real estate sector in 2011, as the homebuilder Estridge filed for bankruptcy, strip-center specialist Broadbent struggled to hold onto its headquarters, and Centre Properties faced a $43 million foreclosure suit.

Local homebuilder Paul Estridge Jr. in late September filed Chapter 7 personal bankruptcy, agreeing to surrender his two homes—one in Westfield and one in Florida—and other possessions to satisfy a mountain of debt he accrued from his former business.

Estridge said he owes a list of creditors including banks, suppliers and vendors more than $50 million. In a bankruptcy filing with the U.S. Bankruptcy Court Southern District of Indiana, Estridge listed assets worth between $1 million and $10 million. Estridge told IBJ he thought his assets had a value of $5 million or less.

The Estridge Group, a fixture in the Indianapolis-area’s homebuilding industry for more than 40 years, became part of Houston-based David Weekley Homes in April when the company could no longer keep up with a mounting pile of debt. Estridge took over the business from his father, Paul Sr., in 1992.

Lenders in 2011 began foreclosure proceedings on The Broadbent Co.’s downtown headquarters as part of a $25 million federal lawsuit against the Indianapolis-based real estate developer.

realestate Lenders sought to foreclose on properties held by The Broadbent Co. and other retail developers. Estridge was among the homebuilders unable to withstand the downturn. (IBJ File Photo)

The Huntington National Bank and PNC Bank filed the complaint in U.S. District Court in Indianapolis on July 22, charging that Broadbent defaulted on various construction loans and mortgages dating from February 2007.

Broadbent, a strip-center real estate specialist, borrowed money to buy and renovate its headquarters at 117 E. Washington St.

IBJ reported in July that George Broadbent sold The Broadbent Co. to his wife, Mary Clare Broadbent, for $50,000 in March 2010 as the mounting lawsuits threatened his control of the company.

As lenders circled, Broadbent also transferred his ownership interests in five retail properties to his wife for “estate planning reasons,” and sold to her his ownership interest in nine other properties for $150,000, court records show.

Broadbent’s properties seeking bankruptcy reorganization include the Castleton Plaza and Greenwood Pointe shopping centers.

The developer Centre Properties also was ailing in 2011, as Boston-based U.S. Bank filed to foreclose on its 130,000-square-foot Centre North Shops at 8510 E. 96th St. in Fishers, the 17,900-square-foot Southport Shops at 7225 U.S. 31 South, and the 13,300-square-foot German Church Shops at 10935 E. Washington St.

Centre Properties, founded in 1985 by Craig W. Johnson and James F. Singleton, has developed more than 2.2 million square feet of retail space in the Indianapolis area, according to the company’s website.

The bank brought the $43 million foreclosure lawsuit in November.•
 

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  1. I am not by any means judging whether this is a good or bad project. It's pretty simple, the developers are not showing a hardship or need for this economic incentive. It is a vacant field, the easiest for development, and the developer already has the money to invest $26 million for construction. If they can afford that, they can afford to pay property taxes just like the rest of the residents do. As well, an average of $15/hour is an absolute joke in terms of economic development. Get in high paying jobs and maybe there's a different story. But that's the problem with this ask, it is speculative and users are just not known.

  2. Shouldn't this be a museum

  3. I don't have a problem with higher taxes, since it is obvious that our city is not adequately funded. And Ballard doesn't want to admit it, but he has increased taxes indirectly by 1) selling assets and spending the money, 2) letting now private entities increase user fees which were previously capped, 3) by spending reserves, and 4) by heavy dependence on TIFs. At the end, these are all indirect tax increases since someone will eventually have to pay for them. It's mathematics. You put property tax caps ("tax cut"), but you don't cut expenditures (justifiably so), so you increase taxes indirectly.

  4. Marijuana is the safest natural drug grown. Addiction is never physical. Marijuana health benefits are far more reaching then synthesized drugs. Abbott, Lilly, and the thousands of others create poisons and label them as medication. There is no current manufactured drug on the market that does not pose immediate and long term threat to the human anatomy. Certainly the potency of marijuana has increased by hybrids and growing techniques. However, Alcohol has been proven to destroy more families, relationships, cause more deaths and injuries in addition to the damage done to the body. Many confrontations such as domestic violence and other crimes can be attributed to alcohol. The criminal activities and injustices that surround marijuana exists because it is illegal in much of the world. If legalized throughout the world you would see a dramatic decrease in such activities and a savings to many countries for legal prosecutions, incarceration etc in regards to marijuana. It indeed can create wealth for the government by collecting taxes, creating jobs, etc.... I personally do not partake. I do hope it is legalized throughout the world.

  5. Build the resevoir. If built this will provide jobs and a reason to visit Anderson. The city needs to do something to differentiate itself from other cities in the area. Kudos to people with vision that are backing this project.

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