Twain files for Chapter 11 to block foreclosure sale

By Steve Green

Monday, Dec. 20, 2010 | 8:42 a.m.

A Las Vegas apartment and condominium complex filed for Chapter 11 bankruptcy reorganization last week to block a foreclosure sale planned by City National Bank.

In court papers filed Friday, Twain Condominiums LLC said it owns 192 condominium units within the 254-unit Twain Estates condominium complex at Arville Street and Twain Avenue.

The property was built as an apartment complex in 1983 and during the economic boom, in 2005, it made plans to convert to condominiums.

After condominium sales were halted in September 2008, the 192 unsold units reverted back to apartment units, company manager Roni Amid said in a court filing.

City National Bank loaned the company $20.37 million in 2006 for the purchase of the property, rehabilitating it and converting the apartments to condominiums, the court filing says.

The construction loan agreement was revised in March 2009 with a new principal balance of $11.4 million.

But a dispute emerged between the company and the bank when City National (CNB) demanded payment of $1.77 million under a ``remargin'' provision in the loan contract.

That provision was aimed at keeping the ratio of the outstanding balance to the fair market value of the property at 90 percent or less, the filing said.

Amid said in the filing the company was current on its loan payments but, after refusing to pay the remargin amount, City National Bank planned to foreclose last week.

``The debtor believes that the value of the collateral is more than the amounts due and owing to CNB under the loan revision agreement as of the (bankruptcy) petition date,'' the company said in a brief filed by its attorneys with the Las Vegas law firm Gordon Silver.

Attorneys for City National have not yet filed a response to Twain's assertions. A meeting of creditors in the case is set for Jan. 20.