SportsQuest failure won’t derail county investment
SportsQuest’s bankruptcy filing won’t affect Chesterfield County’s investment in the athletic complex formerly owned by the company, but it’s still uncertain whether the county will get all the facilities that were promised under the original agreement.
When SportsQuest filed documents in U.S. Bankruptcy Court last week seeking to liquidate its assets, it became clear that the Midlothian-based company had lost its only significant asset when a creditor foreclosed on its Genito Road complex in May.
That creditor, Georgia-based carpet maker Shaw Industries, ended up buying the SportsQuest complex for $4.7 million in a May 29 foreclosure auction where it was the only bidder.
Since then, Shaw has given the nine-field athletic complex a new name, River City Sportsplex, and hired a commercial real estate firm, CBRE Richmond, to manage it.
Mike Golden, director of Chesterfield Parks and Recreation, said that because of the ownership change, “the bankruptcy is not a significant event for the county” as far as the athletic complex is concerned.
Instead, he explained, the county is now working with Shaw, through CBRE, to get the use of the fields that was promised when Chesterfield put up $4.3 million to help get the complex built.
CBRE “is doing a good job managing” the facility, Golden said. He noted that the complex recently hosted the Capital Cup girls’ lacrosse tournament, which drew more than 250 teams and 11,000 people and generated about $4.5 million in tax revenue for the region.
Todd Willett, CBRE’s property manager for River City Sportsplex, said the facility is “fully operational” and that he is “booking events, working hand-in-hand with Chesterfield County.”
Demand to use the complex is strong, Willett said. “We are getting so many calls every day, it’s overwhelming,” he said. “It’s definitely in demand.”
Shaw was one of several companies that had filed mechanic’s liens and lawsuits against SportsQuest late last year and early this year. The company claimed SportsQuest owed it $15 million for the artificial turf it had provided for the fields.
SportsQuest’s Chapter 7 bankruptcy filing last week revealed that with the athletic complex gone, its total assets amounted to just $1,030 while its liabilities added up to about $7.3 million.
That total includes about $72,000 in property taxes owed to the county and also still includes the county’s $4.3 million loan, though that debt was actually tied to the 115- acre athletic complex to secure the county’s 20-year lease on the fields.
The original deal had two components: $2.3 million to lease eight of SportsQuest’s nine athletic fields for five days a week and one weekend a year; and $2 million to use gym space at a sports, aquatics and fitness center, and to designate 10,000 square feet of space for a senior center, in a building to be constructed on SportsQuest’s planned west campus.
While Shaw has committed to honoring the county’s lease on the athletic fields, Golden said plans for the fitness and senior centers are unresolved. “The contract calls for that, and somehow it has to be addressed,” he said.
However, because the original agreement specified that those additional facilities weren’t to open until September 2013, there’s still time for the county and the company to work out an arrangement, Golden said.
Willett said it was too soon to comment on any plans Shaw might have concerning additional facilities. He noted, however, that the company has already invested in improvements on the property, including paving the parking lots, completing the concession stands and improving the signage.
Among the other revelations in last week’s bankruptcy filing, SportsQuest filed a copy of a resolution passed by its board of directors that showed the board had authorized the bankruptcy filing back on July 9. It was unclear why more than three weeks passed before the documents were filed.
In a statement released in conjunction with last week’s filing, SportsQuest managing partner Dudley Duncan said, “The purpose of this filing is to present a full picture of the company to the company’s creditors and investors and to bring closure to the company.”
The statement noted that Duncan “and the other board members took operational control of the company in March of 2012 from Steven Burton, the company’s founder and CEO.”
Burton, a psychologist and former CEO of Midlothian-based ION Healthcare, founded SportsQuest in 2008 and envisioned it as a sprawling, world-class complex of fields, gyms, stadiums and other facilities.
In addition to the 115-acre East Campus where the existing athletic fields are located, he also planned a 97-acre West Campus across Genito Road. That parcel was to feature a fitness and aquatic center; a 6,000-seat arena for sports such as basketball and indoor football; a 6,000-seat stadium for track and field; a 100,000-square-foot field house; more athletic fields; and space for retail and hotel development.
Those plans looked increasingly unlikely over the past year, however, as the company was hit with a succession of liens and lawsuits alleging millions of dollars in unpaid bills and debts.
Burton did not respond to a phone message left last week.