This second bankruptcy filing also comes on the eve of a key event — an Oakland County Circuit Court judge’s hearing on whether to appoint a receiver, a renewed motion for which Southfield filed in December.
The property has been the site of a fire, various code violation citations and other issues that generally make the city consider it dangerous. The December motion for a receiver says more recent incidents at the property include someone throwing items from the building’s roof, damaging a vehicle. It says people continue to inhabit the property.
Robert Bassel, Shefa’s attorney, said the bankruptcy filing last week was a result not only of the impending hearing on a receivership but also whether his client wanted to continue spending money in a protracted legal battle that has been litigated in several courts over many years.
The result of the Chapter 11 case should be a sale of the property “for the most value” and also to “figure out who gets the proceeds,” Bassel said.
“It’s not to shed debt,” Bassel said, noting that Shefa is current on its property taxes and water and sewer bills.
“It’s basically the reality that this particular asset is worth more value to someone who has a clean slate with the city of Southfield than it does with the current owners. It’s business. Not much more to it. It should be sold for the most value. And the bankruptcy code determines who allocates the proceeds.”
Elhadad has attempted before to sell the property, enlisting the Southfield office of Colliers International Inc. to market it to potential buyers as a redevelopment play, as we reported in April.
One of the side issues has been how the redevelopment of the former Northland Center shopping mall site plays out and, now with construction underway