Capstone buying majority stake in Showplace properties
-- Home Textiles Today, 8/26/2009 12:23:00 PM
High Point, N.C. - Capstone Showplace Management, the minority owner of High Point's Showplace properties, says it has reached an agreement to acquire the majority stake in the properties from Walton Street Capital.
Earlier this month, Showplace was placed into receivership after Walton Street defaulted on an $81 million loan, according to court records.
Capstone Showplace, owned by three developers -- High Point residents Maurice Hull and Coy Williard Jr. and Charlotte, N.C., resident Paul Bell -- said it had reached an agreement in principal with Walton Street to acquire the private equity firm's ownership position in the Showplace properties. It said the transfer of ownership is subject to the approval of the lender, Bank of America.
Terms of the deal were not disclosed.
In a statement, Capstone Showplace said Walton Street had tried to negotiate a modification of the loan terms and "found itself in a dispute with the securitized lender's servicing agent. These negotiations became adversarial and a lawsuit was filed."
The Capstone Showplace owners said they were surprised when the lender's agent filed the action against Walton Street. The suit led a Guilford County Superior Court judge to place the showroom operator into receivership.
The receivership involves Showplace and Showplace West (the former First Factors building at 101 S. Main St.), as well as smaller showroom buildings at 200 N. Hamilton, 320 N. Hamilton and 330 N. Hamilton. All told, the properties have more than 700,000 square feet of showroom space, including about 470,000 square feet in Showplace.
Walton Street Capital had acquired the majority ownership of the Showplace properties in 2005, with Hull, Williard and Bell as minority stakeholders.
A Charlotte-based real estate services firm, Lincoln Harris, was named to manage the properties while they are in receivership. Existing Showplace managers are keeping their jobs, but some executives from Lincoln Harris have been added to the staff.
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