ATTLEBORO – New England Sports Village filed for bankruptcy protection Thursday to avoid a foreclosure auction that was scheduled for Friday, a company representative said.
Stuart Silberberg, managing partner of Ajax 5CAP NESV LLC, the holding company of NESV, said the filing was being done electronically, with seven entities involved expected to be completed Thursday night.
The founders of NESV envisioned an ice rink on their property, as well as facilities for soccer, tennis and swimming. So far, only the ice rink is in operation; opened on November 25, 2016.
Silberberg said filing for bankruptcy comes when his business and the property’s mortgage holder have reached a deadlock in negotiations. They have been up and running since the spring, when the first auction was scheduled for the 139-acre property, which is valued at $ 35.9 million for property tax purposes.
It has been rescheduled at least three times.
“There is a dispute between us and the lender that we have not been able to resolve amicably,” he said. “We do not believe that foreclosure is the appropriate action.”
Silberberg said the filing will be under Chapter 11, which gives the company time to build its business, which was badly affected early on by “bad operations” and the coronavirus. The pandemic shut down NESV for three months last year.
“This will be Chapter 11, debtor in possession until cash flow improves and we can get out of this,” Silberberg said. “The message we want to convey is that this freezes everything. It is designed to protect assets and that is what we intend to do. “
Silberberg said he and everyone at NESV are dedicated to turning the tough times and eventually moving forward with the other businesses planned for the Commerce Way property.
“If there was a time to cut and run, it would have to be this,” he said. “But we are not cutting and we are not running.”
Silberberg said business on the track has improved a lot under the leadership of CEO Rob Reilly, who has brought in more teams and events.
“The track is working quite well,” Silberberg said. “It’s not where we want it to be, but it’s significantly better than where it was.”
Silberberg said he wants all tenants to know that nothing is changing, but that he hopes the bankruptcy will create some “distress and uncertainty.”
The move, he said, is intended to save the operation.
“We are here and we are not going anywhere,” he said. “This is the same as usual. We are open and up and running. We look forward to staying in business and serving the community. “
Silberberg has declined to say how behind NESV is with the lender on mortgage payments.
But NESV is currently in arrears with the city in the amount of $ 565,965 in property taxes.
He also owes another $ 4,733 to the water and sewer departments.
But Reilly said NESV is up to date on its recent tax bills of roughly $ 88,000 per quarter and sees no problems paying in the future.
He said he is in negotiations with the city on a plan to add payments each quarter until the tax debt is paid.
“The city has been great,” he said of the negotiations during an on-track interview.
“We are doing well,” he said, noting that other large bills have also been paid, such as electricity to National Grid.
Another setback for the company included bills of at least $ 200,000 for the replacement of rusty pipes caused by salt water that he claimed was provided by the city.
Reilly also praised Silberberg.
“Cut and run wasn’t even an option for him,” he said. “It really has been next to this place.”
Reilly said the bottom line has improved with the addition of new hockey teams, such as the Johnson & Wales University men’s and women’s teams.
The New Jersey Generals have brought in two more teams with younger players and the organization started the Generals Hockey Academy.
Several other youth teams have also been added.
Meanwhile, the track has a deal with culinary students from J&W University to begin operating at The Barn, an on-site restaurant, and a new cafeteria in a space once occupied by Dunkin ‘Donuts.
Additionally, hockey players volunteer to help out with local charities.
“We are empowering students and youth to give back to the community at events like Special Olympics, the Hunger Walk and Big Brothers and Big Sisters,” Reilly said.
Reilly said the runway operation is heading in the right direction.
“Our ice is fully booked,” he said. “We’re not going anywhere.”