2 years or more After filing for Chapter 11 bankruptcy protection Faced with a rise in lawsuits related to past child sexual abuse, the Archdiocese of New Orleans is beginning to raise cash by selling some of its vast real estate holdings.
A lawyer for the local Roman Catholic Church plans to ask a judge this week to allow two separate property transfers to proceed. One was to sell his 12-story office building at 1000 Howard Avenue to a Lafayette-based investor. Another one he’s selling is the Loyola Avenue parking lot behind the Howard Avenue building.
Together, the deal will generate approximately $10 million for the local church and will follow real estate sales totaling approximately $1.9 million early in the bankruptcy process.
It is unclear how far the millions of dollars raised from the sale of the property will go to settle 450 allegations of abuse levied against priests and other clergy who served in the archdiocese. It is also unclear what other financial steps Archbishop Aymond and his advisers will take to pay off what is expected to be a multi-million dollar settlement with victims of abuse.
One reason is that the case is still slowly unfolding in US Bankruptcy Court.
When the New Orleans Catholic Church Joined 20 other U.S. archdioceses by filing for bankruptcy protection As of May 2020, it had assets of $243 million and liabilities of $139 million.
At the time, Aymond said the church, which serves 500,000 Catholics in 112 parishes, needed to seek Chapter 11 protection because of the growing costs of reconciling abuse and the impact of the pandemic. said there was.
Buildings and land owned by the archdiocese were previously valued at about $70 million, according to financial records. However, that estimate is based on the price paid by the archdiocese for the property, which could be significantly lower than the price the property would get on the market.
It also does not include the value of real estate owned by individual churches and church-affiliated entities. The church has not released the estimated market value of his more than 200 properties owned by the archdiocese.
The archdiocese declined to comment on the property sale or bankruptcy proceedings in general.
Still, the attorneys involved in the case see the pending sale of two downtown properties as a step forward in the bankruptcy case, but it doesn’t indicate a settlement with the survivors is imminent.
Jim Stang, an attorney in Los Angeles, said: “We’re glad they’re doing it and they’ve consulted us, but this doesn’t mean there’s been a settlement or moves toward a settlement. Based in Pachulski Stang Ziehl & Jones representing the Committee of Unsecured Creditors in this matter.
Bankruptcy cases usually progress slowly. Cases like the archdiocese shrouded in allegations of child sexual abuse at the hands of priests are no exception.
Over the past two years, dozens of lawyers have debated whether the case should be dismissed on the grounds that the archdiocese is not insolvent. They also question how much information should be hidden from the public.
There are other complications.
for example, FBI is investigating allegations the former Pastor of St. Peter Claver Catholic Church Treme, who was fired from his post in 2021 after being accused of raping a child several years earlier, may have misappropriated nearly $400,000 in parish funds.
The archdiocese confirmed last week that it is cooperating with the FBI in investigating the matter. This was revealed in an audit the church fought to keep private.
Archdiocese officials said the case was unrelated to the larger financial issues in bankruptcy and that the allegations of financial impropriety in St. Peter Claver were an isolated case.
The FBI is also investigating decades-long allegations that clergy may have taken children to other states to sexually abuse them. The Associated Press reported. The church denied knowledge of the investigation.
In a federal investigation, lawyers in bankruptcy cases are trying to come up with a settlement plan to compensate hundreds of sexual abuse survivors who have filed claims against the church.
A property sale is a way to initiate the liquidation and financing of a settlement of assets.To date, the church has completed the sale of Only one main parcel, Former St. Elizabeth Ann Seton School Kenner, Developer Acquired at Auction About $1.9 million.
According to Stang, the Howard Avenue property sale is sizeable and a relatively easy way for the church to generate cash.
“It was a building they felt they didn’t need anymore, which was overkill given its condition, its maintenance costs, and the damage it suffered in the hurricane,” Stang said. It was something they no longer needed.”
Bankruptcy allows the archdiocese to consolidate all past abuse allegations and try to move past them financially. Author Jason Berry, who has written extensively about
“The church pays lawyers heavily and cuts the funds available to survivors. Many of them need money to rebuild their broken lives,” Berry said.
While the pending sale may not signal a settlement of the bankruptcy case, the transaction is significant to the potential redevelopment of Howard Avenue.
Lafayette-based Triple or Nothing LLC signed a purchase agreement with the Archdiocese earlier this year for $8.3 million to acquire a mid-century modern office building on Howard Avenue. The building includes an attached parking garage and garage.
According to court records, the group agreed to complete the sale by December 30, with a due diligence period expiring on November 7.
Triple or Nothing, LLC is registered with Lafayette investor Samer Mohd, who owns multiple businesses in Lafayette and owns several local investment properties near Mid-City and Tulane Avenue.
Parker McEnery, a commercial real estate broker whose firm liquidates real estate assets on behalf of the archdiocese, declined to elaborate on Mohd’s plans for the building site. However, he said investors plan to redevelop the site into a hospitality concept that is new to the market.
“This is going to be a big deal for the Howard Avenue corridor,” said McEnery. “This is a large-scale redevelopment project.”
Another deal in court is the sale of a parking lot just behind the building on Howard Avenue. Local property developer Mk RED signed a purchase agreement to acquire the lot for $1.68 million, court records show.
Mk RED declined to comment on pending sales or the company’s real estate plans. is included.