Panthers’ David Tepper bankrupts real estate business over Rock Hill project

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Carolina Panthers owner David Tepper, the NFL’s wealthiest owner, bankrupted his real estate development company Wednesday night after the team headquarters project in Rock Hill, SC, was scuttled

In a Chapter 11 filing in the Delaware federal bankruptcy court, Teppers GT Real Estate Holdings LLC said it had liabilities ranging from $100 million to $500 million, a similar range for assets, and up to 49 creditors.

The move would allow Teppers GT Real Estate Holdings LLC, an entity separate from the team, to begin court-ordered proceedings to pay creditors, primarily contractors, who worked on the site that was to be the new home and practice facility the Panthers.

In a statement, GT Real Estate (GTRE) announced that it has received a $20 million financing commitment from DT Sports Holding, LLC, subject to court approval that will allow the company to pursue a proceeding to address its to fund legitimate creditors’ claims; and to preserve, protect and enhance the Rock Hill site for the benefit of all stakeholders.

“Over the past few weeks, GTRE has been faced with various claims, some valid and some not, from vendors, contractors and other third parties, including York County, SC GTRE is taking these steps to ensure legitimate claims are processed as fairly and quickly as possible as part of a court-supervised process and to achieve an orderly and secure execution of the project. GTRE intends to honor its legitimate obligations.”

It’s the latest domino to fall in the harrowing unraveling of a proposed $800 million project that the Panthers said would bring jobs and businesses like retail stores, restaurants and a hotel to Rock Hill, a high school soccer hub , which is 25 miles south of the Panthers’ existing headquarters at Bank of America Stadium in Charlotte.

During an April press conference, his first in more than a year, Tepper repeatedly declined to answer questions about Rock Hill.

An NFL spokesman said he doesn’t expect any problems with Tepper’s filing.

“GTRE is not part of the club’s group of companies,” the spokesman said. “GTRE does not own any football-related assets, nor have any football-related assets been pledged in any way for costs incurred to date or remaining obligations.”

The Chapter 11 filing lists contractor Mascaro/Barton Malow as the largest creditor with an unsecured claim of $26,809,900 that the document says is disputed. Also in dispute is the second largest claim of $20 million from York County, SC, which is listed as unsecured. And Architect Populous’s $784,534 unsecured claim is also listed as disputed.

The league has very conservative financial rules, although they don’t appear to apply to a bankruptcy filing by an owning company not legally affiliated with the team. GT Real Estate is incorporated in North Carolina.

His 2022 annual report filed with the Secretary of State lists Tepper as the only officer with no mention of the team or its sports holding company. The 2019 organizational registration filed with the state was signed by Jeffrey Kaplan, an officer at Tepper’s hedge fund corporation.

But the league could worry about the image of its wealthiest owner, who is using the bankruptcy law to avoid paying, at least in full, contractors it hired and then no longer needed.

“To paraphrase Donald Trump and (Frank) McCourt, who bankrupted the Dodgers and various other billionaires and bankrupted their companies, this is just something they can do without having to experience any personal repercussions if they do it.” right,” said Zev Shechtman, bankruptcy attorney at Danning, Gill, Israel & Krasnoff.

Just because Tepper is a multiple billionaire doesn’t mean he can’t also bankrupt one of his companies. Generally, a corporate officer is not personally liable for his debts, although this may not prevent creditors from taking legal action against him.

“To file for bankruptcy, there are no particular restrictions on eligibility, like you don’t have to be in default or insolvent,” Shechtman said. “Or you know, even you don’t have to have a specific problem to be eligible for bankruptcy, you just have to file for bankruptcy.

“As a wealthy owner of a company, he has done nothing wrong by merely being a wealthy owner of a company or bankrupting the company when the company is otherwise eligible for bankruptcy. Why should he be personally liable?”

Tepper canceled its agreement with the City of Rock Hill in April, moving away from an ambitious project expected to be completed in 2023. The Panthers announced in March that they would pause construction at the facility after Rock Hill failed to issue $225 million in bonds to pay for public infrastructure associated with the project.

Tepper, the Forbes-listed hedge fund manager with a net worth of $16.7 billion, invested more than $175 million in the project. The state-of-the-art headquarters was already taking shape and can be seen from Interstate 77, along with mountains of red earth and work on a new interstate switchboard.

In April, a spokesman for GT Real Estate Holdings said in a statement that Rock Hill defaulted on its infrastructure bonds in early 2021. A little over a year later, after what GTRE described as an “ongoing effort” the city was urging for public funds, Tepper’s company told Rock Hill they had 30 days or the team would move on.

“It is unfortunate that some have recently decided to undertake a misguided, destructive public relations campaign to cover up their failures,” the GTRE spokesman said in the statement.

In the meantime, the Panthers will retain their headquarters and practice fields at Bank of America Stadium, one of the NFL’s oldest venues. Tepper said the team recently conducted a feasibility study to see what improvements would be needed if the Panthers decide to continue playing there in the short term. The team will continue their training camp at Wofford College in Spartanburg, SC

(Photo: Griffin Zetterberg / USA Today)

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