Orange County Choppers faces foreclosure

FOUND AT CYRIL HUZE BLOG – http://www.cyrilhuzeblog.com/2010/12/06/orange-county-choppers-headquarters-facing-foreclosure/#more-56553

The foreclosure action by lender GE Commercial Finance Business Property Corp. claims that OCC missed mortgage payments of approximately $96,400 and $14,000 due on July 1 on 2 loans of $11 million and of $1.5 million used to build the Newburgh, NY headquarters.  The Orange County (Industrial Development Agency (IDA) is also named as a defendant in the action, since it owns the property under a payment-in-lieu-of taxes arrangement with Orange County Choppers.

IDA gave important tax breaks to OCC in exchange of the company building the headquarters in the New-York State county. The Orange County IDA is not liable for the back mortgage payments because a clause in the lease-back arrangement indemnifies it against default by Orange County Choppers.

OCC lawyer Richard Mahon states that in 2007 the building had an estimated market value of $12 million, but now is worth only $7 million. Consequently, he says that OCC stopped making payments to put pressure on GE Commercial Finance to modify the terms of the 2 loans. Reliable sources tell me that OCC is structured via different independent companies and that assets are substantial and protected. So, don’t assume that OCC or that Paul Senior are broke because their real estate loans are not paid on time…Real estate business as usual, recession style. But it may be more, a 1st step to a Chapter 11 reorganization to adjust to a new economic reality…

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