Thursday, July 11, 2013

Famous Masonic Temple in Downtown Detroit Files for Bankruptcy

By John Clark

The Detroit Masonic Temple, which has operated as an iconic theater for several decades is filing for bankruptcy protection, in a move that may foreshadow Detroit?s decision to pursue the same form of debt relief.

Or at least it seems like the theater is filing for bankruptcy. According to a report from the Detroit Free Press, the manager of the Masonic Temple claims that the theater is in fine financial shape.
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Manager Disputes Report of Bankruptcy Filing

According to Steve Genther, the manager of the Masonic Temple, the theater itself is not seeking bankruptcy help. Rather, the entity that filed for bankruptcy is the theater?s former management company, sources say.

But sources say it?s beyond dispute that the famous theater, which has served as a venue for musicians as famous as the Rolling Stones, has struggled with a wide range of financial problems for several years.

Sources also say the theater narrowly avoided having its electricity service stopped last year, and was headed towards foreclosure before musician Jack White saved the venue by paying its $142,000 tax bill.

Again, though, Genther stresses that the bankruptcy filing isn?t tied to the theater, but instead to the company that used to own the property. In addition, Brad Dizik, the Masonic Temple?s spokesman, also told sources that the theater is in no danger of filing bankruptcy.

Nevertheless, the Theatre Co., the company that owns the Masonic Temple, is facing an enormous lawsuit from an event company. This lawsuit, however, has been stayed pending the completion of the bankruptcy.

Sources also say that the Theatre Co. may have up to $500,000 in debt, but its assets are only worth a maximum of $50,000. The company reportedly owes money to several creditors, the largest of which are the State of Michigan Unemployment Insurance Agency and All American Waste Services of Romulus.

Theater Troubles Match Financial Ills Faced by Detroit

While Detroit?s most historic music venue faces potential foreclosure, the city itself continues to limp towards a potential bankruptcy filing of its own, sources say.

Detroit has flirted with bankruptcy for months, and is currently in the hands of an emergency receiver who has temporarily taken control of the city?s finances away from the mayor and city council.

Thus far, the city has managed to remain afloat, but as revenues continue to sink and pensions costs continue to rise, Detroit may soon find itself on the precipice of a historically large municipal bankruptcy, sources predict.

Source: http://www.clearbankruptcy.com/blog/famous-masonic-temple-in-downtown-detroit-files-for-bankruptcy/

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