Developer files for bankruptcy protection, claiming plenty of assets
Why was the auction of Joseph Perroncello’s apartment complex in North Cambridge canceled Wednesday only 33 minutes before it was scheduled to start? Maybe because the developer filed for bankruptcy about an hour before that.
Perroncello, a Boston resident whose site on Yerxa Road and Rindge Avenue has been riling neighbors for six years of slow construction, filed for Chapter 11 bankruptcy protection at 9:33 a.m. Wednesday, according to documents filed in Boston for assignment to Judge Frank J. Bailey.
In Chapter 11 bankruptcies, debtors — Perroncello, in this case — are usually allowed to hang onto their assets and keep on running business, sometimes with court-appointed oversight, while coming up with a way to pay what is owed. It’s usually used by businesses or people with extremely high debt.
The filing by Everett attorney Richard A. Mestone says Perroncello has estimated liabilities of between $10 million and $50 million and fewer than 50 creditors, but assets of between $50 million and $100 million. That likely includes his home at 198 Beacon St., a 15-room brownstone with eight fireplaces and a roof deck with, according to city-data.com, a total assessed value of $5 million; among Perroncello’s creditors is the city of Boston, to which he owes $600,000 in real estate taxes.
But Boston is listed as only his third-largest creditor. According to the bankruptcy filing, Perroncello owes $7.7 million to East Boston Savings Bank in mortgage payments; $700,000 to Stephen Finn, also of Beacon Street; $244,131 to Pilgrim Savings Bank of Cohasset, also for mortgage payments; and, to round out the top five, $200,117 to Bac Home Loans Servicing of Simi Valley, Calif., also for mortgages.
Cambridge appears as No. 7 on the list of 20 top creditors needed for the bankruptcy filing. Perroncello owes the city $157,957 in real estate taxes.
The entire list of top 20 creditors accounts for $10.4 million, of which $8.8 million is attributed to mortgage debt. There are six separate Pilgrim Bank mortgage debts that total $752,098 and, when combined, take the No. 2 slot on the list.
There is also $147,999 in debt related to construction and services for Perroncello properties, including $57,000 for Aaxiom Construction Services of West Bridgewater and Sean Farrell Excavation of Dorchester; $50,363 for utility providers Nstar, Boston’s water and sewer department and Verizon; and $40,636 owed for credit at home improvement stores Lowe’s and Home Depot.
Perroncello filed for bankruptcy before, in March 1992, according to the documents filed by his lawyer.
On Thursday notices were filed in Perroncello’s case by a representative of Webster Bank, the holder of his mortgage for 45-47 Yerxa Road and 120 Rindge Ave. It was Webster Bank that had arranged for the foreclosure auction of the property that was to be held Wednesday and has now delayed the auction for the second time. The event is scheduled for Jan. 27.
Neighbors and area watchdogs said they feared Perroncello would find a way to buy back the property, where two of the three buildings aren’t far enough along to hold tenants. When complete, the site can hold 63 units.
Perroncello is due in Middlesex District Court on Nov. 16 but can avoid a trial if city inspectors agree he has cleaned his site adequately.