Shorewood Realtors may have filed for Chapter 11 bankruptcy protection, but it’s not about the money.
The top performing Santa Monica brokerage firm is not in any financial difficulty, president and CEO Roger Herman told Easy Reader News. The filing was a strategic move to stay a claim filed by a creditor and former partner. Its assets were unfrozen last week.
“We’re very profitable this year,” he said. “It’s had nothing to do with [Shorewood’s] financial issues.”
Shorewood filed for Chapter 11 protection last month in Colorado, the location of its parent company, LBH. LBH owed more than $500,000 to 26 Shorewood real estate agents and $45,161 to the office staff, according to Herman’s declaration.
LBH also allegedly owes real estate company ERA Franchise Systems $6 million. An additional $3.8 million is owed to founder Arnold Goldstein and co-owner Larry Wolf, who are now the company’s chairman emeritus and consultant, respectively. But Goldstein and Wolf claim most of that debt is related to the failed purchase of Hermosa Beach company Brighton Escrow, which the two men subsequently bought.
Many of the other 26 agents named as being owed money did not express concern about the debt.
“It’s equivalent to an escrow that gets delayed — if you’re in real estate, you’re used to delays,” Shorewood Realtor Ed Kaminsky told Easy Reader News.
Shorewood operates nine offices in the South Bay and has posts in Colorado, South Florida and Las Vegas. [ER] — Cathaleen Chen