Mohammad Honarkar, CEO of 4G Ventures, speaks during a Laguna Beach Business Club meeting at Kitchen in the Canyon in October 2018. Photo by Daniel Langhorne
A Los Angeles County Superior Court judge on Wednesday appointed a new liquidator to take control of the businesses of a well-known Laguna Beach real estate investor, including the company that manages the Laguna Hotel.
In the previously unreported lawsuit, filed on June 25, Coastline Loans LLC, based in Delaware, sought the payment of a $ 175 million loan, accrued interest and legal fees from companies managed by Mohammad Honarkar.
“Defendants have violated the terms of their respective obligations through various breaches of contract including, but not limited to, pending legal proceedings, material representations including but not limited to undisclosed debts, and failure to pay loan fees and interest,” said the Coastline Loans attorney , Tom Normandin wrote in the complaint.
This is the third court order for the custody of Honarkar’s real estate holdings in the past year. Covina-based liquidator Carl G. Petta is entitled to collect all profits from the properties under the July 14 order signed by Judge Mitchell Beckloff.
The portfolio includes several high-profile hotel and event properties, including the Holiday Inn on 696 S. Coast Hwy., The Hive on Laguna Canyon Road, Seven7Seven, 7 Degrees, the Royal Hawaiian Restaurant and the former Laguna Nursery site. The loan also includes several other short-term rentals in Laguna Beach, a commercial building in Corona del Mar at 2711 E. Coast Hwy., An apartment complex in Redlands, and two vacant lots near Koreatown, Los Angeles.
The administration proceedings began last July following a court order related to Honarkar’s divorce proceedings with his ex-wife. The bankruptcy practitioner on the case was eventually fired by a judge after he reported that the property was hampered by multiple lawsuits, a state tax audit, and the specter of looming debt, including an estimated $ 150,000 in back taxes for Laguna Beach.
In January, Honarkar’s former creditor filed a foreclosure lawsuit on a $ 195.5 million loan backed by a portfolio of 19 properties, pending a lawsuit filed in Orange County Superior Court. This receivership dragged on until the underlying loan was acquired by a company controlled by Laguna Beach developer Chris Dornin. In a surprise twist, on June 8, an Orange County Supreme Court judge approved an order authorizing Honarkar’s company to refinance with a new creditor.
Court documents have since revealed Coastline Loans LLC as the new creditor. But through June 24, Coastline said Honarkar owed them more than $ 176 million in unpaid current principal, with interest accruing in excess of $ 48,000 per day.
Honarkar downplayed the impact of the recent administration on Tuesday.
“The [Orange County] Richter approved a refinancing agreement last month and we have a new lender, ”he said in a prepared statement. “The lender applied, and we agreed that a new liquidator would be set up pending my divorce – probably in the coming weeks.”
Coastline Loans’ lawsuit makes no mention of divorce proceedings.
In a phone interview with the Independent on Friday, Andrew Stupin, CEO of Coastline Real Estate Investments in Huntington Beach, said his group had decided to give Honarkar the loan because he thought it was a good investment.
“I know them [Hotel Laguna] Property. I’ve been a surfer and beachgoer in Orange County since then [1950s]”Said Stupine. “The new group with Mo has a great vision for it. I think they have the firepower to make it happen. “
When asked if he was ever concerned about Honarkar’s legal battle with his former creditor, Stupine said he was not involved in the details of the ongoing legal battle
Ioannis Xilikakis verified the appeal as an authorized agent for Coastline Loans LLC. The Lake Forest resident is president of calling card wholesaler IX Telecom, Inc. Xilikakis did not respond to a call Monday for comment.
Laguna Beach partially canceled a work stoppage at the Hotel Laguna on Thursday, so that renovation of the restaurant, bar and hotel lobby could be resumed, according to a press release from the city.
“This forced administration does not affect the city’s partial lifting of the work freeze,” City Director Shohreh Dupuis said in a statement late Tuesday.
It is unclear how the appointment of a recipient will affect plans to reopen the hotel’s first floor to the public. The presiding judge ordered Honarkar’s company to give Petta all bank records, proof of insurance, property keys, current rental lists, and other documents.
Petta did not respond to calls to his office for comment.
“The first phase of the revitalization of the Laguna Hotel will be completed in a few weeks and we look forward to inviting our friends and neighbors to experience and enjoy them,” Honarkar said in a prepared statement.
A hearing in the Los Angeles County Superior Court is scheduled for September 23.