The Uptown 240 development in Dillon is pictured on Oct. 21, 2021. (Libby Stanford/Summit Daily)
An 11th-hour objection, complete with an allegation of forgery, has halted the $12.8 million sale of a partly built and weather-beaten condominium project in Summit County.
“There have been a lot of twists and turns,” said U.S. Bankruptcy Judge Thomas McNamara.
Uptown 240, in downtown Dillon, was to be an 80-unit, $80 million complex. Instead, it became a boondoggle during the pandemic, filed for bankruptcy last February and went up for sale. After its first buyer backed out, it was to be sold to Michigan-based Porritt Group.
But a Jan. 3 hearing to approve that sale revealed another turn in Uptown 240’s twisting tale.
CallComm Mining, a small telecom company in Denver, appeared at last week’s hearing to say that it has a lease at 240 Lake Dillon Drive — the property Uptown 240 sits atop — and the right to buy a portion of the land. That didn’t go over well with Uptown’s buyer or seller.
Since 1998, CallComm has operated a telecom site on the property, which consists of a prefabricated building with equipment and an antenna. CallComm’s last lease, signed in 2016, also gave it the right to purchase half of the small property that the building is on.
The property in question had an address of 186 Buffalo St. That address no longer exists.
Before construction began on Uptown 240 in 2019, 186 Buffalo St. was merged into the much larger 240 Lake Dillon Drive property. As compensation for losing its telecom site, CallComm was to get a condo at Uptown 240, a lease for rooftop space so it could put its antenna there, and it would become the exclusive telecom provider for Uptown 240, according to CallComm.
But that agreement was never memorialized, CallComm says now, and Uptown 240 may never be built. So, CallComm instead wants to buy half of 186 Buffalo St. for $32,500.
“That right cannot be stripped away,” CallComm attorney Michael Lamb said Jan. 3.
The former developers of Uptown 240, at 240 Lake Dillon Drive in Dillon, say the project is 35 percent complete. (Hilco Real Estate/Vimeo)
Keri Riley, the bankruptcy attorney for Uptown 240, disagrees for two reasons. First, CallComm terminated the 2016 lease in 2019, so it cannot enforce its terms in 2024. Second, even if it hadn’t done so, CallComm can’t buy half of 186 Buffalo because there is no 186 Buffalo.
“It would be an option to purchase 50 percent of a property that no longer exists. Moreover, it would be a purchase from somebody who no longer owns any portion of the property that no longer exists. So, it creates a convoluted layer on top of a convoluted layer,” she said.
Lamb claims CallComm owner John Gazzo never signed the lease termination.
“Mr. Gazzo disputes that that is his signature on the termination agreement,” Lamb said.
“It’s a forgery?” asked McNamara, the judge.
“Yes, your honor, that’s what he will testify to,” Lamb said of Gazzo.
“Well, that’s why we have trials, so we can figure that out. That’s a strong position that it’s a forgery. It may be one that requires expert testimony on handwriting,” McNamara said.
The judge set an all-day hearing for Feb. 7 to sort out whether the lease was ever terminated and, if not, whether it gives CallComm the right to buy part of 240 Lake Dillon Drive.
What that means for the sale of Uptown 240 to Porritt Group remains to be seen. In addition to being its prospective buyer, Porritt also holds Uptown 240’s debt. So, it could declare that Uptown 240 is in default on its loans and foreclose on 240 Lake Dillon Drive at any time.
“If a sale order is not entered by Jan. 8 … we can essentially pull the plug on the deal, which we don’t really want to do,” Porritt attorney Paul Urtz told McNamara last week.
“I’m trying to decide if I should even spend the time scheduling this hearing,” the judge said.
McNamara agreed to set the hearing after receiving assurance from Urtz that Porritt will alert the judge and cancel next month’s hearing if and when it chooses to foreclose.
“To use a colloquialism, in our opinion it’s not really over until the fat lady sings,” Riley, the Uptown 240 lawyer, told the judge, “and in this particular instance, in our view, that would be (Porritt) filing a motion to vacate the hearing based on an anticipated foreclosure.”
The Uptown 240 development in Dillon is pictured on Oct. 21, 2021. (Libby Stanford/Summit Daily)
An 11th-hour objection, complete with an allegation of forgery, has halted the $12.8 million sale of a partly built and weather-beaten condominium project in Summit County.
“There have been a lot of twists and turns,” said U.S. Bankruptcy Judge Thomas McNamara.
Uptown 240, in downtown Dillon, was to be an 80-unit, $80 million complex. Instead, it became a boondoggle during the pandemic, filed for bankruptcy last February and went up for sale. After its first buyer backed out, it was to be sold to Michigan-based Porritt Group.
But a Jan. 3 hearing to approve that sale revealed another turn in Uptown 240’s twisting tale.
CallComm Mining, a small telecom company in Denver, appeared at last week’s hearing to say that it has a lease at 240 Lake Dillon Drive — the property Uptown 240 sits atop — and the right to buy a portion of the land. That didn’t go over well with Uptown’s buyer or seller.
Since 1998, CallComm has operated a telecom site on the property, which consists of a prefabricated building with equipment and an antenna. CallComm’s last lease, signed in 2016, also gave it the right to purchase half of the small property that the building is on.
The property in question had an address of 186 Buffalo St. That address no longer exists.
Before construction began on Uptown 240 in 2019, 186 Buffalo St. was merged into the much larger 240 Lake Dillon Drive property. As compensation for losing its telecom site, CallComm was to get a condo at Uptown 240, a lease for rooftop space so it could put its antenna there, and it would become the exclusive telecom provider for Uptown 240, according to CallComm.
But that agreement was never memorialized, CallComm says now, and Uptown 240 may never be built. So, CallComm instead wants to buy half of 186 Buffalo St. for $32,500.
“That right cannot be stripped away,” CallComm attorney Michael Lamb said Jan. 3.
The former developers of Uptown 240, at 240 Lake Dillon Drive in Dillon, say the project is 35 percent complete. (Hilco Real Estate/Vimeo)
Keri Riley, the bankruptcy attorney for Uptown 240, disagrees for two reasons. First, CallComm terminated the 2016 lease in 2019, so it cannot enforce its terms in 2024. Second, even if it hadn’t done so, CallComm can’t buy half of 186 Buffalo because there is no 186 Buffalo.
“It would be an option to purchase 50 percent of a property that no longer exists. Moreover, it would be a purchase from somebody who no longer owns any portion of the property that no longer exists. So, it creates a convoluted layer on top of a convoluted layer,” she said.
Lamb claims CallComm owner John Gazzo never signed the lease termination.
“Mr. Gazzo disputes that that is his signature on the termination agreement,” Lamb said.
“It’s a forgery?” asked McNamara, the judge.
“Yes, your honor, that’s what he will testify to,” Lamb said of Gazzo.
“Well, that’s why we have trials, so we can figure that out. That’s a strong position that it’s a forgery. It may be one that requires expert testimony on handwriting,” McNamara said.
The judge set an all-day hearing for Feb. 7 to sort out whether the lease was ever terminated and, if not, whether it gives CallComm the right to buy part of 240 Lake Dillon Drive.
What that means for the sale of Uptown 240 to Porritt Group remains to be seen. In addition to being its prospective buyer, Porritt also holds Uptown 240’s debt. So, it could declare that Uptown 240 is in default on its loans and foreclose on 240 Lake Dillon Drive at any time.
“If a sale order is not entered by Jan. 8 … we can essentially pull the plug on the deal, which we don’t really want to do,” Porritt attorney Paul Urtz told McNamara last week.
“I’m trying to decide if I should even spend the time scheduling this hearing,” the judge said.
McNamara agreed to set the hearing after receiving assurance from Urtz that Porritt will alert the judge and cancel next month’s hearing if and when it chooses to foreclose.
“To use a colloquialism, in our opinion it’s not really over until the fat lady sings,” Riley, the Uptown 240 lawyer, told the judge, “and in this particular instance, in our view, that would be (Porritt) filing a motion to vacate the hearing based on an anticipated foreclosure.”
