Wednesday, July 24, 2013

Bankruptcy court takes bids for Commander Premier Aircraft assets

The former quarters of Commander Premier Aircraft Corp. at the Cape Girardeau Regional Airport are still locked up tight after a failed attempt to establish a small plane production company nearly eight years ago, but news of some action from recent bankruptcy court hearings has given city officials some hope the debacle could come to an end as early as next spring.

The city of Cape Girardeau evicted the company from a 52,000-square-foot hangar at the airport in October 2011 after Commander failed to make lease payments going back to 2007. The company began business at the airport in 2005, but never produced any aircraft after announcing plans to hire 100 people within three years to build single-engine planes to sell for $600,000 apiece.

A Texas court has handled bankruptcy proceedings for the company since 2011. At a hearing last week, the court accepted several bids for Commander's assets, which city officials say is another significant step toward a final disconnect with the company. Until the court is done with the bankruptcy case, the city cannot market, lease or sell the hangar. The court, according to city attorney Eric Cunningham, now has to decide which creditors have rights to assets and which bids for assets to accept. An attorney representing the city in the case has advised officials that the case could wrap up by April.

City manager Scott Meyer said the city wants the hangar freed up as soon as possible, but officials' hands are tied. That will only come through a judge's decision.

"We are pushing for it to go faster, because we would love to be done with it, but the wheels of justice roll at their own pace," he said.

A growing consensus among city officials is that the hangar should be sold instead of leased once the bankruptcy proceedings are finished so as to avoid the problems seen in the past.

"It's certainly been my position for some time that we would prefer to sell," Meyer said.

Airport manager Bruce Loy said the leasing of hangars at the airport is a common setup and often works without issue, but the particular situation the city has experienced with Commander is not one he prefers to see repeated.

"If we did lease, I do think we would ask for money in advance, and other things. We really don't want to go through this again," Loy said. The sale of city property would require the approval of the city council. The city is unable to sell the land that contains the hangar because of Federal Aviation Administration rules. If the hangar were sold, the land would still be involved in a lease agreement.

The city sold $2.6 million in bonds in 2001 to finance the hangar's construction and associated extension of utilities. The bonds were paid off by the city in 2011 with $1.69 million received from the purchase of property by Isle Casino Cape Girardeau. Debt problems associated with the hangar began in 2004 when another company, Renaissance Aircraft, had possession, but folded and failed to pay off the bonds per a contract with the city.

As of this week, city officials do not yet know who submitted bids to the bankruptcy court. Jason Searcy, a Longview, Texas, attorney representing Commander, did not return messages left by phone seeking information about the bankruptcy case.

At least one company showed interest in purchasing assets of the Commander earlier this year. In March, the Airport Advisory Board reported several tours of Commander assets were organized for interested companies, and an unnamed Chinese company, according to the report to the board, "seemed to be more interested than the others and stated they have plans to make an offer to the bankruptcy trustee."