Nate Paul loses some Austin properties to foreclosure
By Bob Sechler
By Shonda Novak
Posted Dec 1, 2020 at 4:53 PM Updated Dec 1, 2020 at 6:42 PM
Austin American Statesman
Nate Paul is starting to lose pieces of his real estate empire.
A handful of properties that had been controlled by the Austin businessman and his company, World Class Property, were acquired during a foreclosure sale Tuesday at the Sweatt Travis County Courthouse by a lender owed about $22 million in delinquent debt.
The loss of the properties — which include the downtown site that was at one time home to Carmelo’s Italian restaurant — represents just the tip of the iceberg in terms of the potential financial woes facing Paul, who also is a central figure in an ongoing controversy regarding allegations of corruption against Texas Attorney General Ken Paxton.
Since late last year, lenders to Paul and his company have tried to foreclose on a combined $258 million in what they contend are overdue loans made to more than two dozen Texas-based real estate entities that Paul controls, according to a review by the American-Statesman.
Until this week, however, Paul had managed to forestall his lenders, often by filing for Chapter 11 bankruptcy protection on the limited liability entities that technically own his various real estate assets. Many of the bankruptcies — which automatically halt efforts to collect overdue debt — have come just before scheduled foreclosure sales were to proceed.
The loss of properties that Paul suffered Tuesday exemplifies the limits of that strategy.
His attorneys filed bankruptcy in November 2019 on four Paul-controlled entities that own the properties — named 900 Cesar Chavez LLC, 905 Cesar Chavez LLC, 5th and Red River LLC and 7400 South Congress LLC. But after a year without a viable plan to make good on the delinquent debt, the automatic stay from bankruptcy court that prevented foreclosure was lifted last month, enabling this week’s auction to take place.
The lender to all four — an entity called ATX Lender 5, which is an affiliate of real estate firm Stonelake Capital Partners — was the sole bidder Tuesday, winning the properties for $17.8 million, although no money changed hands because the lender was owed more.
Paul wasn’t present at the foreclosure sale, and he didn’t respond to a request for comment afterward.
But Mark Taylor, an attorney working for Paul, called the foreclosure sale invalid and said he plans “to pursue appropriate relief.”....
The article is much much longer and mentions another upcoming auction as well as his involvement with Paxton.
https://www.statesman.com/business/2...o-foreclosure?
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