Columbia-based McGill Development Co., among the larger commercial real estate developers in the Baltimore area, filed for Chapter 11 under the U.S. Bankruptcy Code Monday.
McGill's filing, along with the reorganization filing of two of its subsidiaries, illustrates the tough times faced by shopping center developments that opened during the recession.
McGill is the owner and operator of Bel Air Town Center at U.S. 1 and Route 24 and the Roberts Field Shopping Center in Hampstead. Both opened within the past year, and McGill had difficulty finding tenants, according to the developer's bankruptcy lawyer, Mitchell Stevan of Weinstock, Stevan & Harris in Baltimore.
"McGill had a slow start-up as far as getting tenants," Mr. Stevan said. "As a result, the interest charges to creditors accrued before they had the money to deal with them."
In papers filed in U.S. Bankruptcy Court in Baltimore, the three McGill companies' assets and debts were listed as follows:
* McGill Development Co., a general partner in various limited partnerships that own and operate shopping centers. Assets were unknown and debts were listed as $52.8 million. McGill Development's largest creditors were listed as Florida-based CrossLand Savings Bank and Towson-based Hicks & Rotner Associates Inc.
* McGill Development Limited Partnership #3, which owns and operates Bel Air Town Center. Assets were listed as $13.7 million and debts as $11 million.
* McGill Development Limited Partnership #4, which owns and operates Roberts Field Shopping Center. Assets were listed as $9.5 million and debts as $8.7 million.
McGill's chairman, Charles W. Kurz, refused to comment yesterday through his secretary.
Mr. Stevan said that McGill has recently done a good job in getting tenants for the shopping centers. He said that Bel Air Town Center is 92 percent leased and Roberts Field is 77 percent leased.
"It is a miserable commercial real estate market out there now for shopping center developers who have new properties. It is particularly difficult to fill up small spaces," said Joseph Cronyn, senior associate with Legg Mason Realty Group Inc.