Sports complex owner won’t appeal lease dissolution

MIDDLETOWN —- It’s apparently game over for the bankrupt Delaware Sports Complex LLC project.

With an invalid lease and no money to appeal a recent federal court ruling, DSC owner Dan Watson indicated he’s giving up hope for developing sports fields designed to draw large scale events to the southern New Castle County area.

In an email last week, Mr. Watson informed Town of Middletown Mayor Kenneth L. Branner Jr. and others of his intent to drop any action and “I have concluded that technical challenges — timing challenges really — built into the Plan Confirmation rules and procedures for ‘small business’ were too great to overcome in the context of a parallel appeal process.

“But life’s like that sometimes. I trust we will talk again.”

On Wednesday, Mayor Branner said he would not comment until after a Sept. 21 court hearing involving the bankruptcy motion for dismissal.

The town partnered with original DSC owners on a 99-year lease at $1 annually to develop part of a 319.69 acre tract that the municipality owns on Levels Road near U.S. 301 and the Maryland border west of Middletown. The town mistakenly included unrelated Charles E. Price Memorial Park in the lease.

The project was hamstrung by financial woes and over $1.6 million in claims by 13 creditors against the DSC were filed, including $195,000 sought by the town.

After buying out original investors on March 1, Mr. Watson filed for Chapter 11 bankruptcy protection on May 23, and a federal judge determined the project was not living up to expectations and nullified the lease on Aug. 21.
In a notice to dismiss the bankruptcy filing on Aug. 31, the DSC indicated it had almost no assets and debt payment to any creditors almost impossible.

Mr. Watson had been paying for the bankruptcy proceedings out of pocket, according to the notice, and “is not willing to commit the funds necessary to prosecute an appeal without some indication that the creditors whose claims would ultimately be paid supported his efforts.”

A sports complex could work in the Middletown area, Mr. Watson believes.

“The fundamentals are still there to succeed but implementing that given the town’s approach to financial and other issues is tricky,” Mr. Watson said Wednesday.

Using the fields

Maintaining that an eviction by the town won’t likely become effective until late October at least and describing the DSC as a “holdover tenant”, Mr. Watson hoped that the Delaware Revolution youth soccer club can continue to use the grass fields until then.

“I can’t imagine that the town won’t accommodate the kids and their families through the fall season since the fields are just sitting there,” he said.

Still pending is the town’s separate agreement with Mr. Watson to manage a clubhouse, swimming pool and golf course within the nearby Estates at Saint Annes neighborhood. A 99-year lease at $1 is in flux due to uncertainty about facility construction and readiness for occupancy.

Mr. Watson said he’s uncertain is what’s been built follows construction plans he says were made in 2008 for the eventual facility managers.

“I’m puzzled as to the construction of the building,” he said. “While it appears superficially from the outside to be moving forward, it lacks all the facilities a clubhouse would need to have inside such as a kitchen, dining room, plumbing, exhaust fans and electrical systems that are shown on the plans.”

In what he described as an effort at maintaining “complete transparency,” Mr. Watson hosted an open public meeting at a Middletown hotel last week to answer questions from residents and soccer families. Roughly 20 Estates at Saint Annes residents attended, along with Delaware Revolution members.

“The meeting was fine,” Mr. Watson said. “There are a number of interested residents, of course, and we’re awaiting completion of the clubhouse as shown in the plans to move ahead.”

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