Image courtesy of RODE Architects
A federal judge dismissed the bankruptcy case for a $90 million development on the Dorchester waterfront, clearing the way for a foreclosure auction next month.
The Neponset Wharf project stalled amid lack of financing, delays in environmental approvals and financial disputes between developers Rise Together and City Point Capital.
The property’s lender, Crowd Lending Fund, issued a $9 million mortgage in 2022 and scheduled a foreclosure auction in March. The bankruptcy filing in May delayed the auction.
But a U.S. Bankruptcy Court trustee objected to the developers’ Chapter 11 reorganization plan. In an Aug. 12 motion, Trustee Justin Kesselman urged the court to dismiss the case or convert it to Chapter 7 liquidation. Harrington cited the failure to pay $29,757 in outstanding property taxes, the debtors’ failure to file a monthly operating report in June, and the unlikelihood that the project can be revived.
“The debtor has no employees or revenue,” Harrington wrote.
Following a hearing Tuesday, Judge Janet Bostwick dismissed the bankruptcy case.
Developer Ryan Sillery of South Boston-based City Point Capital originally proposed a 330,000-square-foot development in 2017 at 24 Ericsson St. on the Port Norfolk peninsula. Boston-based Rise Together joined the development team in 2020 and submitted updated plans for 120 apartments, office space, retail shops and a boathouse replacing the existing boat storage buildings.
The project was approved by the Boston Planning & Development Agency board in 2022, but state regulators objected to construction in a FEMA flood plain and warned the project could aggravate flooding in the primarily residential neighborhood.
In August 2023, Massachusetts Secretary of Energy and Environmental Affairs Rebecca Tepper ruled that the project’s supplemental final environmental impact report “does not adequately and properly comply” with the Massachusetts Environmental Protection Act, and ordered developers to submit additional details on coastal resiliency and flood control strategies.
The development has listed total liabilities of nearly $10.6 million, and estimated the project value at $20 million, according to the bankruptcy case filings.
The foreclosure auction is now scheduled for Oct. 24, according to a listing from Paul E. Saperstein Co.
