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Debt Management Law News

May 18, 2010

Houston Club Building has filed for Chapter 11 bankruptcy

The owner of downtown's Houston Club Building has filed for Chapter 11 bankruptcy protection in an effort to forestall foreclosure proceedings.

The owner is an affiliate of Cameron Management, a Houston-based real estate firm that owns office buildings in Houston and San Antonio.

Earlier this month, a related affiliate lost a building in the Galleria area to foreclosure. It was the 2000 St. James Place property, which lost a major tenant after the company purchased it in 2007. Cameron hopes to work with its lender until it can secure a new tenant for the Houston Club Building.

The company hired architecture firm PageSoutherlandPage to plan an educational facility that would take up some of the space.

The company hired architecture firm PageSoutherlandPage to plan an educational facility that would take up some of the space.

“We're hoping the bankruptcy judge will let us keep going,” said Cameron's Jano Nixon Kelley.

The Cameron affiliate bought the nearly 350,000- square-foot Houston Club Building at 811 Rusk building from Chase in 2007. It's about 80 percent leased.

The owner took out a loan with Wachovia, which came due last year. Up until then, all principal and interest payments had been made on time, Kelley said.

A bank spokesman said the company does not comment on client relationships.

One of the major issues is the Houston Club lease, which was made in 1955 and is for $1.38 per square foot per year. The lease expires in 2015.

“Effectively, the building subsidizes a private club and therefore loses money annually due to this lease,” Kelley said.

The Houston Club is a member-owned private club that was founded in 1894. It leases 128,000 square feet on four floors. Cameron Management has been trying to renegotiate the lease and scale down the club's space. A club official could not be reached for comment.

Sometimes, debt can be overwhelming, and bankruptcy becomes necessary.
Bankruptcy can sometimes be difficult. If you are considering bankruptcy, contact the Houston bankruptcy lawyers of Weston & Associates, PLLC at 713-623-4242

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