May 2, 2012
By: John Clark
The three companies who joined forces to create the massive Jersey City waterfront development, Liberty Harbor, are filing for bankruptcy after falling $89 million in debt, according to a report from The Jersey Journal.
In addition, the former mayor of North Bergen, New Jersey, who controls the three companies, says the bankruptcy filing will help him pay a $21 million judgment leveled against him by a New Jersey family in a land dispute.
Sources indicate that Liberty Harbor Holding LLC, Liberty Harbor II Urban Renewal Co. LLC and Liberty Harbor North Inc., which collectively own the Liberty Harbor venture, owe almost $90 million to multiple creditors, according to papers the companies filed in U.S. Bankruptcy Court.
Liberty Harbor’s first phase was completed in 2007, and it fulfilled the developers’ dreams of opening a large development on the southern edge of Jersey City’s underused waterfront. This phase included nearly 700 residences and a small number of retail stores.
The timing, however, could not have been worse, as the global recession struck soon after the development opened, and the developers soon became embroiled in a land dispute with the former owners of a parcel of land that had been seized by the city in 2004 for Liberty Harbor.
Sources say that Lynn and Katherine Kerrigan, who owned the seized land, disputed the initial state offer of $4 million for their property. And a recent court decision, which determined that the property was worth more than $18 million, affirmed their complaint.
As a result of this decision, Peter Mocco, the lead developer, now reportedly owes the Kerrigans more than $21 million due to interest that has accumulated since the initial judgment.
In a recent statement, Mocco told sources that the bankruptcy filing would be a much swifter solution than letting a lawsuit between the two parties drag on for years. In fact, he anticipates that the filing may be done within 60 days.
In his words, "All we’re looking to do is work and resolve this issue and do it in a way that we can work out a settlement agreement that is bulletproof."
Showing faith in his bankruptcy lawyer, Mocco also insists that the bankruptcy filing will not cripple the future financial stability of Liberty Harbor, and he reportedly believes that the complex will eventually be completed as planned.
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