Despite Colt Armory’s successful move towards being named a National Historical Landmark last week, court papers indicate the project’s developers are facing serious financial difficulties. Documents filed with Hartford Superior Court indicate investors are seeking to foreclose on the mortgage to the Colt developer, Homes For America Holdings.
The investors, and others, including the project’s prominent architect, Tai Soo Kim, are suing the developers for a total of $9 million.
New York-based developer Homes For America Holdings has been working on the stalled $115 million project since 2002, hoping to turn Coltsville into residential and office space, a museum and a visitor’s center celebrating the armory’s historic impact.
Already mired in extensive debt, including nearly $500,000 in unpaid taxes, a number of lawsuits reflects the financial fragility of the project. USA Capital Diversified Trust — itself filing for bankruptcy and currently the subject of an FBI investigation — leads several other lenders in a foreclosure lawsuit filed in November. The group is suing Colt Gateway LLC, Homes for America Holdings and several other businesses that have done work on the site.
In 2002 and 2003, the trust investors loaned about $8.7 million to Homes For America Holdings. They had extended the loan’s due date to December 2006. The lawsuit alleges that Homes For America Holdings paid off some of its debt but still owes $6 million plus more than $3 million in interest. The investors have notes on four Colt buildings.
Rebekah MacFarlane, spokeswoman for the project, said the lenders had agreed to delay foreclosure proceedings and that the parties were “very close” to an agreement that would cut all obligations and ties between investors and developers — but she wouldn’t disclose any details of what that agreement might be.
After that agreement takes place, she said, Colt developers can turn their attention to the other lawsuits pending, including to its architect, Tai Soo Kim, who is suing the developer for $300,000.
Tai Soo Kim’s gripe stems from nonpayment for work done on several Colt buildings. According to his suit filed in August, Colt had fallen behind on payments in 2006. It wasn’t the first bump in the pair’s relationship. In 2004, the architect and developer had to hash out a deal after another period of nonpayment from Colt.
Similarly, Abatement Industries is suing Colt for several hundred thousand dollars for asbestos removal and other services for which the firm claims it never got paid.
MacFarlane said that while recent attention has focused on Colt’s troubles, Home For America is seeking new investors, and the available sections of Colt buildings are filling up with tenants.
“We’re seeing the light at the end of the tunnel,” she said.
