Owners of Twin Rinks Ice Center, a privately funded ice skating facility in Eisenhower Park, have filed for bankruptcy and plan to sell their assets, including a 30-year licensing agreement with Nassau County, court filings show.
Twin Rinks, which opened 14 months ago, filed for Chapter 11 protection Monday in U.S. Bankruptcy Court in Central Islip.
In an affidavit included in the filings, Joel Friedman, one of three owners of Twin Rinks at Eisenhower LLC, said the facility has been unable to "generate sufficient cash to pay its creditors on a timely basis."StoryRink owners make $100G late payment
Twin Rinks "will be unable to meet its current operating expenses and will be unable to maximize the value of its estate absent a sale of substantially all of its assets," the affidavit says.
The company had projected originally that construction of the 165,000-square-foot facility would cost $15 million. But a balance sheet included with the affidavit shows that construction costs escalated to $52.1 million, the filings show.
"They decided to build a much larger facility within the footprint of the allowable space," said Brian Nevin, spokesman for Nassau County Executive Edward Mangano.
"On top of that, as construction went on the licensee decided to do additional improvements that they believed would better the facility."
Friedman acknowledged that the project went significantly over budget, but said the next owner should be able to make a profit. He said the facility will remain open during the bankruptcy and that all programs, training and clinics will continue.
"Chapter 11 is not a fire sale," Friedman said. "The doors are open. The programing is here."
Twin Rinks is claiming assets of $52.6 million and liabilities of the same amount. Liabilities include a $47.9 million loan from Clearview Capital Management LLC, a private investment firm where Friedman serves as president.
The company owes a total of $4.6 million to its 20 largest creditors. CMBS Venture Funding, an investment management company, also holds $5.2 million in secured claims. CMBS shares a Jericho address with SilvermanAcampora LLP, where Joel Friedman's brother, Ronald, is a partner.
Ronald Friedman said his brother handles the Twin Rinks business. "I have no involvement," he said.
Twin Rinks is projecting an operating loss of $9,816 over the next 30 days, filings state.
Chris and Peter Ferraro, twin brothers from Port Jefferson who played for the New York Rangers and are co-owners of Twin Rinks, did not respond to requests for comment. Court filings show the brothers each received a monthly salary at Twin Rinks of $10,416 plus health benefits and $500 for a car allowance.
Twin Rinks said it will sell all assets owned or leased by the company, including the licensing agreement it signed with Nassau in 2012, the filings state.
County Attorney Carnell Foskey said Nassau has hired the Garden City law firm of Bond, Schoeneck and King to monitor the bankruptcy proceedings.
"It is our understanding under the bankruptcy process, which we are reviewing, that we would consider a sale of the license to an appropriate purchaser with the necessary experience to operate a public-private facility," Foskey said.
Ed Blumenfeld, chief executive of the Syosset-based Blumenfeld Development Group, said he may be interested in purchasing the facility. "We are investigating," he said.
A source said the New York Islanders considered Twin Rinks as a potential practice facility but found the cost prohibitive. The team announced last week that it would spend $5.1 million to renovate the ice rink at Cantiague Park in Hicksville as a practice facility.
An Islanders spokesman did not respond to a request for comment.
Twin Rinks, which hosts youth and adult hockey leagues, skating lessons, camps and clinics, has two indoor NHL-sized rinks, a smaller outdoor rink, a sports therapy training area and a pro shop.
In a 2013 groundbreaking, Mangano touted Twin Rinks as a "sports-entertainment destination" that would create two dozen jobs and generate $35 million in economic benefits in its first five years.
In May, Twin Rinks made its initial $100,000 licensing payment to Nassau 31 days after the county-imposed deadline.
Newsday reported that Twin Rinks also had failed to set up a $150,000 performance bond to ensure the contract's completion and a reserve account that would use 2.5 percent of the gross receipts to fund regular improvements to the facility.
This month, Twin Rinks paid the $150,000 surety bond, documents show. Records also show that Joel Friedman established the reserve account in late May, but did not make the required $32,226 payment.
In 2013, the Nassau Industrial Development Agency granted Twin Rinks $100,000 in sales tax breaks to purchase building materials, furniture, equipment and machinery. IDA executive director Joe Kearney said Thursday that the bankruptcy could constitute a default by Twin Rinks, allowing the agency to recapture the money. The IDA is considering its legal options, he said.