Hill Country Galleria owners cleared the final hurdle Monday in their effort to sell the property through an auction process and absolve themselves of a 10-month long bankruptcy.

Western District of Texas U.S. Bankruptcy Judge Craig Gargotta approved REIT Management & Research LLC’s $75 million bid for the property and the sale is expected to close Friday. REIT is a commercial and industrial real estate firm headquartered in Boston and manages several Austin properties.
An ownership group including Christopher Milam and Lincoln Property Co. and a host of debtors led by Bank of America agreed on the $75 million bid REIT made in a Jan. 15 auction at the Austin law offices of Hohmann, Taube & Summers. Three bidders attended the auction.
Joel DeSpain, owner representative and asset manager, said he was pleased with the price given the state of the market.
“It was a good sales price for the debtor and the lenders in consideration of the marketplace. I think that this buyer will be good for the property,” DeSpain said.
If the owner-debtor groups didn’t sign off on the bid or if Gargotta had blocked the sale, Hill Country Galleria would have been foreclosed and transferred to the lenders which also include Guaranty Bank; Sovereign Bank; Landesbank Hessen-Thiiringen Girozentrale; Key Bank National Association; National City Bank; The Northern Trust Company; MidFirst Bank; and Bank of the West.
Last fall, primary partner Opus West Corp. sold its interest in Hill Country Galleria to the remaining owners, and property management transferred to Lincoln Properties. Operations and employees have remained the same throughout the transition.
In July 2009, Opus West Corp. and some of its subsidiaries filed voluntary petitions for Chapter 11 reorganization under the U.S. Bankruptcy Code in order to facilitate an ongoing financial restructuring.
John Greer, chief restructuring officer of Opus West, said the bankruptcy filings were made necessary due to steep and pervasive declines in commercial real estate values and persistently difficult credit market conditions.
“While we began slowing the pace of new development nearly two years ago in anticipation of difficult market conditions, we must now take additional measures to enable an orderly wind down of our portfolio, protect asset values and maximize returns on lenders’ investments,” Greer wrote in a company press release.