US building project linked to Dunne gets back on track
Published 11/08/2015 | 02:30
A multi-million dollar building project linked to bust developer Sean Dunne by a bankruptcy official is to be allowed proceed in the US.
Restrictions which effectively halted the completion of the $11m (€10m) condominium development will be partially lifted under the terms of an agreement reached between Mr Dunne's wife Gayle Killilea, a bankruptcy trustee and a finance company.
The move comes after weeks of legal wrangling placed the four-home development in Greenwich, Connecticut, in jeopardy. The project is being undertaken by 151 Milbank Avenue LLC, a company run by Ms Killilea, a former newspaper columnist and socialite.
Bankruptcy trustee Richard Coan served a 'lis pendens' notice - a lawsuit involving the title to a property or a claimed ownership interest - last April, indicating he may seek a lien on the property, alleging Mr Dunne (pictured inset) is its beneficial owner.
Mr Coan is pursuing tens of millions of euro in assets, which he claims Mr Dunne fraudulently transferred to his wife.
The Carlow-born developer has debts of close to €700m, but denies any fraudulent transfers and any links to the property.
Mr Coan's notice caused work to come to a halt as Avant Capital, a lender providing $3.5m (€3.2m) in finance, has refused to allow the company draw down further cash while the lis pendens is in force.
However, legal papers seen by the Irish Independent reveal that after weeks of discussions, the project looks set to be completed.
Under the terms of the agreement, 151 Milbank Avenue LLC can continue construction, sell off the condominiums and repay Avant Capital.
However, the remaining profits will have to be placed in an escrow account until a court determines whether or not Mr Dunne has any beneficial interest in the development.
Under the agreement, Ms Killilea's company has to provide a revised budget for the development to Mr Coan and Avant Capital. If the lender is happy with the budget, it will agree to release the remainder of the $3.5m loan. According to court filings this hurdle could be cleared later this week.
The Greenwich project is one of two involving Ms Killilea which are the subject of lis pendens notices.
A $22m (€20m) apartment development in New York's Soho district ground to a halt earlier this year in similar circumstances.
That development involves a company run by Ms Killilea and her stepson John Dunne.