A marathon tug-of-war over a marina and some prime waterfront property tucked off the Ashley River could be nearing the end of its rope.
Offers are due soon for the foundering Ripley Light Yacht Club, though it remains to be seen whether any bidders ante up.
The sellers are seeking a big number — and a possible end to years of grueling litigation between two estranged business partners.
The dispute goes back more than a decade. The legal highlights have included a bankruptcy filing and at least three lawsuits in multiple states. The S.C. Supreme Court described the business feud as “long and tortured” — and that was two years ago.
Now, the push is on to sell the property and send everyone on their separate ways.
It hasn’t been easy getting to this point.
This messy business began in 2003, after a couple of investors teamed up to develop a sliver of land along Ripley Cove, an inlet across from the peninsula’s medical district.
Stuart Longman and his Emerald Investments LLC of Norwalk, Conn., owned the real estate. Kriti Ripley LLC, an affiliate of New York-based, Greek-backed investment firm Kriti Management Inc., had the money.
The new partners created a company called Ashley River Properties II to develop residential condominiums and boat slips. Longman contributed the property and the permits for a 70 percent stake. Kriti kicked in $1.25 million in cash for the rest.
The venture quickly unraveled amid allegations of misappropriated funds.
Kriti took over management of the deal. Emerald was stripped of its voting rights, and its ownership was cut to 21 percent after it stopped funding its part of the development.
Other developers watched from the sidelines. Several would-be buyers looked at purchasing the project — one offer came in at $20 million, according to court documents — but none of the deals panned out.
All the while, the legal volleying went on. Emerald, which for years was unsuccessful in trying to force Kriti out for alleged mismanagement, scored a minor victory in 2010 when arbitrators restored its ownership to 70 percent, but not its voting rights.
Kriti then pressed to foreclose on its partner’s interest in Ashley River Properties II. A Charleston judge denied the request, saying it wasn’t the proper legal remedy, but the state Supreme Court reversed that ruling.
That cleared the way for a foreclosure auction that was scheduled to take place in late 2014. But Longman bought himself some more time by declaring Emerald bankrupt the day before, temporarily halting all legal action.
Judge Martin Glenn of New York has been presiding over the latest twist. He appointed a trustee to the case in March and in July he ordered the Charleston property sold.
Longman and a New York law firm that’s owed money have objected to the bidding procedures. Kriti supports the deal, on the condition the sale price is high enough to pay off Ashley River Properties II’s debts of about $15 million and “a material portion” of a judgment it has obtained against Emerald.
The magic number is $18 million, more than double the $7.96 million value determined by the most recent appraisal of Ripley Light, according to documents. Longman estimated in February that the property is worth more than $30 million. The trustee has put the figure between $17 million to $22 million.
Colliers International is marketing Ripley Light, which includes 5.7 acres of undeveloped land, 86 boat slips in Ripley Cove and the rights to expand the marina into the nearby Ashley River. Prospective buyers are required to sign confidentiality agreements.
“We’ve had lots and lots of interest,” said Scott Rogers, a broker with Colliers International’s downtown office.
Bids are due Tuesday, and Rogers estimated it will take court officials in New York a few weeks to sort through the offers. If none of them is up to snuff, the action could shift back to Charleston one last time.
“If a sale of the marina property is unsuccessful, the likely result may be ... to permit the South Carolina foreclosure sale,” the judge in Emerald’s bankruptcy wrote.
Contact John McDermott at (843) 937-5572.