ASM Global seeks to collect $1.5M it says it is owed by GreenCity developers

A conceptual rendering shows the arena in relation to other buildings in the proposed GreenCity mixed-use development. (BizSense file)

Fallout from the stalled GreenCity development is continuing for the project’s now-former developers.

ASM Global, which had signed on to develop and manage the massive mixed-use development’s anchor arena, earlier this month entered a filing in Henrico Circuit Court seeking to collect more than $1.5 million it says it is owed from Green City Development Corp., an entity led by developers Susan Eastridge and Michael Hallmark.

The Los Angeles-based venue management company filed a confession of judgment April 11 that stems from an August 2023 promissory note between GCDC and ASM, through which ASM lent the developers $995,000 after signing onto the project earlier that year.

The filing includes an affidavit by Tim Lamoriello, general counsel of ASM Global, stating that GCDC promised to repay the amount with interest on or before the note’s maturity date but has paid no part of it and is therefore in “continuing default.” The note’s terms required full payment no later than Dec. 31, 2023.

The $1.5 million consists of the $995,000 principal amount, plus about $117,200 in first-year interest, $110,600 in second-year interest pro rata, and $305,700 in attorneys’ fees representing 25% of the outstanding principal. According to the affidavit, the initial interest amount was due Aug. 8, 2024, and the year-two interest was due April 3 of this year.

The document notes that interest continues to accrue at a rate of $457 per day, and fees are accruing at about $114 per day.

Also filed April 11 was a suggested garnishment summons for the $1.5 million to be served to the Henrico Economic Development Authority as the suggested garnishee. The summons states that the garnishment is against “debt due or property” of GCDC relating specifically to “money obtained for the purchase of real property” for the project.

GCDC had made two $500,000 payments toward its planned purchase of the project site before Henrico declared the developers to be in default of project agreements earlier this year. The combined $1 million was part of a three-year payment plan that required a final $5.2 million payment, which was due in February but was not paid.

The former Best Products headquarters building. (Henrico County photo)

The county has since initiated a process to take back the 93-acre former Best Products property that makes up about half of the larger GreenCity site, the rest of which is being developed for residential uses by local firm Markel | Eagle.

The process could involve a repurchase option in which Henrico would essentially pay back to GCDC the $1 million they have put toward the purchase, though the repurchase amount is said to be negotiable.

Eastridge and Hallmark formed GCDC as the land ownership entity for their development group for the project, Green City Partners. Eastridge is CEO of Fairfax-based development firm Concord Eastridge, and Hallmark is a principal with Richmond-based design firm Future Cities.

Because ASM was brought into the project by Green City Partners, ASM’s involvement in GreenCity ends with the developers, Henrico County Manager John Vithoulkas has said. While the developers and the county agreed to mutually part ways, Vithoulkas has said Henrico would welcome ASM’s participation going forward.

An aerial rendering of the proposed $2.3 billion GreenCity development.

The county is preparing to issue a request for interest from other developers interested in picking up GreenCity. It was targeting to put out that RFI by the end of this month. The project has been planned to include a 17,000-seat arena, two hotels, retail, green space and office buildings, including a rehab of the former Best Products headquarters building.

ASM’s garnishment summons lists a hearing date of May 2. It was filed for ASM by attorney Richard Brand, managing partner and sports industry group co-leader for ArentFox Schiff in San Francisco. Attempts to reach Brand Wednesday afternoon were unsuccessful.

The confession of judgment filing lists another attorney, Bruce Hanson, who was general counsel at ASM until last September and is now with another company.

No responses to the filings had been made with the court as of Wednesday. Eastridge did not return requests from BizSense seeking comment.

The post ASM Global seeks to collect $1.5M it says it is owed by GreenCity developers appeared first on Richmond BizSense.