Dade, Marion developer goes bankrupt

Dade, Marion developer goes bankrupt

June 25th, 2009 by Andy Johns in News

The developers of Sequatchie Pointe were in court Tuesday filing more paperwork in their pending bankruptcy.

Many lots in the subdivision, which spans Dade County, Ga., and Marion County, Tenn., already are sold, and at least one owner is concerned that the company may not finish roads and utilities.

"I understand the bonds (to pay for the work) are out there and, hopefully, the county will take care of it," said John Philie, a Brooklyn native who now lives north of Tampa and bought the Sequatchie Pointe lot for a mountain home.

But for property owners, it may make a difference where their property sits.

County officials in Marion County say property owners have nothing to worry about because they required that Sequatchie Mountain LLC take out a performance bond to serve as an insurance policy.

"Meaning that, if something like this happens, you can't just abandon the people there without roads or water," Marion County Mayor Howell Moss said.

Dade County lot holders may not be as lucky. Dade County executive Ted Rumley said his county did not require such a bond.

"Thank God I'm on the Tennessee side," said Mr. Philie, whose property is a quarter-mile north of the line.

Sequatchie Mountain, its parent company, J.J. Detweiler Enterprises, and four other affiliated companies filed for bankruptcy in Ohio on June 18, according to the company's attorney, Marc Merklin.

Mr. Merklin said the company filed for Chapter 11 reorganization when the housing slump caused the developer to default on its loans. He said he hoped the reorganization would allow the company to settle its disputes with creditors and emerge without property owners seeing much of an impact.

"I'm not sure at this point it will have any real impact on the folks that purchased lots," Mr. Merklin said.

Mr. Rumley said he hoped the attorney was correct but, in the future, Dade County officials would look into requiring bonds with all developments.

"It's something that's needed to protect people," he said.

Mr. Philie said he hoped his lot would be ready to go a year ago, but he was told it probably would be next summer before it is accessible for construction.

With the bankruptcy, he's putting his house designs on hold.

"Until I can get to my lot, there's no sense," he said.