The Last Stand
I received notification today that the foreclosure sale for
Wyndholme Village will take place on April 30, 2001. Next Saturday,
March 17, 2001 is the second anniversary of the date when I had no
other alternative, but to file for Chapter 11 bankruptcy protection.
In October of 1998, Wyndholme Village (WVLLC) was to be
funded $7,150,000 in proceeds (bridge loan). Two weeks prior to the
closing of that loan, the lender's access to capital was suspended. It
was disclosed that inappropriate actions by one of their senior
officers instituted the suspension. The inability to replace those
funds resulted in the filing of Chapter 11 and the struggle we have
all experienced for the past two years.
It might be hard to believe, but I am still extremely
optimistic that 12 months from now I will have the honor of welcoming
the Members of The Founders Club into their new homes. There is
a saying "persistence overcomes resistance".
My persistence and willingness to risk all of the monetary possessions
I worked very hard to accumulate is-- because I am committed to
creating a community that promotes a better quality of life for all
seniors.
I consider myself very fortunate to have a loyal group of
individuals from the deaf and hard-of-hearing community who have
responded in such a positive manner and supported all of
my efforts to get construction started. Unfortunately to date, all
efforts have ended in disappointment. Hopefully that is about to
change!
With your continued support, we have another chance that "Our
Dream will become a Reality." Please allow me to explain.
The level of debt incurred to obtain the necessary zoning
changes; purchasing the land; and the extensive amount of
infrastructure required to access the plateau where the buildings are
located has been the major stumbling block in obtaining financing.
Coupled with the additional debt accruing daily, the probability of
financing has diminished even more as time has slipped by.
Typically lenders require full payment of their construction
financing when 85% of a building is sold. The original construction
loan to build The Watson and Sterling Houses approved in May of 1998
was structured accordingly.
The purpose of the bridge loan was to finance the remaining
land. At that time (October 1998), the total debt on the remaining
land was approximately $4,250,000. The appraised value of the land
supported the $7,150,000 bridge loan, which unfortunately did not
materialize.
At that time, the proceeds from the bridge loan was the
correct amount of dollars necessary to pay off the existing loans and
establish a reserve account to pay the monthly interest until revenue
was generated from the sale of condominiums.
However now the outstanding debt alone exceeds $7,000,000!
With so much additional debt, the value of the land will not support a
bridge loan. This situation greatly reduces the possibility of a
potential bid at auction being offered in the amount needed for Leeds
Federal Savings Bank and the New York Investment group to realize the
amount of money they are owed. NOTE: Their loans combined are over
$6,000,000 of the outstanding debt.
With the help of Jim Macfadden and his associate John Veach,
we are now attempting to secure a construction loan that will be
entirely repaid when 85% of the residences in the Watson House are
occupied. The remainder of the proceeds will be applied to the
outstanding debt. Subject to successfully completing The Watson House,
the same procedure will apply to future buildings until all of the
outstanding debt is paid.
If financing can be secured between now and the scheduled
auction sale, it will provide a very attractive alternative to the
risk associated with the auction sale.
With all of the negative results from prior attempts to
obtain financing, we need to rally all of the support that is
possible.
We need all of the contracts of sale that we already have
and ask that anyone considering a purchase at Wyndholme to ACT NOW!
The window of opportunity gets smaller with the passing of each day.
A YEAR AGO NO ONE WOULD HAVE THOUGHT THE BALTIMORE RAVENS
WOULD BE WINNERS OF SUPER BOWL XXXV.
WORKING TOGETHER AS A TEAM, WE WILL BE WINNERS IN CREATING
THE FIRST NON-SUBSIDIZED COMMUNITY FOR SENIORS THAT HAS NO BARRIERS IN COMMUNICATION.
On behalf of the entire Wynholme Village Team, I want to
extend our gratitude to all of the purchasers that have remained under
contract, especially the Members of The Founders Club. Their
support has provided the opportunity for "The Last Stand".
Your involvement will make this attempt a major success!
Please continue to encourage everyone you know to support
Wyndholme Village.
James M. Lancelotta
Managing Partner
Wyndholme Village, LLC
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