ERBO Properties seeks timeline change for migrant shelter proposal

Chicago, July 7 – ERBO Properties LLC is filing for an alteration to the scheduled timeline for its Chapter 11 case as the company may have found a way to bring significant money to the debtors’ bankruptcy estates, according to a filing with the U.S. Bankruptcy Court for the Southern District of New York on Thursday.

ERBO is exploring a proposed lease for $10.15 million in rental income, and the tenant will pay real estate taxes and all expenses of the property.

The rental income will be sufficient, the filing says, to retain a broker to sell the property at 541-545 West 21st Street in New York or locate exit financing.

There would also be immediate money from one of the debtors’ officers, Hershel Klein, to fund the cost of a $4 million buildout and July real estate taxes, previous problems cited in the company’s bankruptcy case.

ERBO was approached with the opportunity to develop the property as a migrant shelter by HipHoticHelps, Inc., a non-profit entity which has contracted with New York City’s department of social services.

Under a department of social services grant, there is opportunity for a migrant shelter lease to start Oct. 1.

Klein would loan money to the debtor upon court approval, New York’s Department of Buildings’ approval of plans for the property and a proposed lease with Uline Holdings, LLC.

The debtors are seeking a pushback in the schedule, to July 20, to file an amended plan of reorganization and an amended disclosure statement with a hearing on July 26.

The plan confirmation hearing had previously been set for July 12.

The New York-based property owner filed bankruptcy on Feb. 13 under Chapter 11 case number 23-10210.

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