NEW YORK CITY-A federal bankruptcy judge has approved theamended reorganization plan filed by Tarragon Corp., courtdocuments show. The locally based residential developer andmultifamily investor and several subsidiaries had filed forChapter11 protection in January 2009, citing $1 billion indebt on assets of $840 million.

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In the reorganization plan approved late last week by JudgeDonald Steckroth of US Bankruptcy Court for the District of NewJersey, Tarragon will liquidate some assets but maintain controlover others through an entity to be called New Ansonia that will bejointly owned by creditors and key company executives.Additionally, Tarragon’s unsecured creditors will contribute claimsto a creditor entry in return for 100% of the equity in thatentity.

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The creditors will own 50% of New Ansonia’s equity, whileTarragon president Robert Rothenberg and Beachwold Partners LLP, ofwhich Tarragon CEO William Friedman is general partner, will ownthe other half.

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Tarragon is being represented by attorneys Michael Sirota andWarren Usatine of Haceknsack, NJ-based Cole, Schotz, Meisel, Forman& Leonard, while Dan Lowenthal, a partner at Patterson BelknapWebb & Tyler LLP in New York, is representing the creditors. Aspokeswoman for Lowenthal says Steckroth complimented attorneys onboth sides for achieving a successful restructuring amid achallenging economic environment.

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Headquartered in Manhattan, Tarragon’s operations areconcentrated in the Northeast and Southeast as well as Texas, andinclude both for-sale and rental apartments. Locally, it operatesthree condominium developments in New Jersey and one in Warwick,NY.

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Paul Bubny

Paul Bubny is managing editor of Real Estate Forum and GlobeSt.com. He has been reporting on business since 1988 and on commercial real estate since 2007. He is based at ALM Real Estate Media Group's offices in New York City.