NEW OWNERSHIP COULD BE ON HORIZON AT DALLAS MARKET
Byline: Rusty Williamson
DALLAS--A change of ownership at the Dallas Market Center could be imminent. Yielding to one of the several financial pressures it faces, the family of developer Trammell Crow, current owner of the DMC, has agreed to halt its litigation in state district court here fighting foreclosure on the huge complex that includes the International Apparel Mart, Menswear Mart and four other buildings. The settlement agreement filed last week by the Crows ends the prospect of a jury trial set to start next month and unlocks a restraining order imposed in December by Judge Michael O'Neill that has kept foreclosure at bay by lenders Equitable Life Assurance Society of the U.S. and Dai-Ichi Life USA. The lenders have been threatening foreclosure since October, claiming the Crows were in default on interest payments. As owners, though, the Crows technically have the option of seeking bankruptcy protection. "It means practically that we can proceed to foreclose," said Jonathan Miller, senior vice president of Equitable Real Estate in New York. "We have from the start said that was our intention. The suit [filed by the Crows in November] had temporarily blocked this. We are planning to proceed with foreclosure." Miller said a foreclosure process, which could happen in early June, would involve placing a public notice of foreclosure. "Then you wait 30 days, and if the payment issues aren't worked out we're in a position to take back the property," he said. Court papers outlined terms agreed to by the Crows to end the legal dispute. They are bound "not to commence any further litigation to block foreclosure (other than a bankruptcy filing)." The Crows also must deposit $3.25 million into escrow to secure the commitment, payable to the lenders in the event the Crows violate this provision. In granting a temporary injunction against foreclosure last December, O'Neill ordered the Crows to post a $3.25 million equity bond to maintain control of the DMC. Though the foreclosure path seems clearer with Thursday's agreement, negotiations still are ongoing between the Crows and the lenders. Harlan Crow, son of Trammell Crow and overseer of the family's real estate holdings, said Friday, "Our family and Equitable continue to work on this matter and hope to get this resolved." He said the family would prefer to continue its longstanding involvement with the DMC, if it's possible. A spokesman for the Dallas Market Center reiterated that the outcome wouldn't alter management operations or goals. "Since both parties are committed to the growth and success of the Dallas Market Center, the ultimate outcome should not affect our goals or in any way alter projects currently under way."
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