Walnut Hills Chapter 11 Win
Andrews Myers, P.C. Successfully Protects Equity, Preserves Value, and Delivers a Full-Pay Reorganization for a Hospital-Campus Owner.
Andrews Myers represented Zoo Real Estate Holdings, LLC (“Zoo”), the sole equity holder of Walnut Hills–Greenville Ave, LLC (the “Debtor”), in a fast-moving, highly contested Chapter 11 that culminated in confirmation of Zoo’s full-pay plan and substantial consummation within six weeks—despite the appointment of a Chapter 11 trustee and an impending expedited sale.
Business Overview and Plan Sponsorship
Walnut Hills is a single-asset real estate debtor that owns an eight-story medical facility and structured parking located at 7502 Greenville Avenue in Dallas, Texas, leased to an affiliate operating a 199,000+ square-foot acute care hospital with approximately 100 beds, ICU, ORs, cath labs, imaging, pharmacy, lab, and ED. The hospital employs roughly 230 people and serves a broad payer mix, including Medicare and commercial payors. As the Amended Plan sponsor, Zoo stepped in to stabilize the case and filed a First Amended Chapter 11 Plan that refinanced the property and paid all allowed claims in full—averting an estate-destructive “fire sale” that would have liquidated the asset at a fraction of its value.
Legal Issues and Post‑Trustee Engagemen
After the Debtor’s initial counsel failed to adequately prosecute the case, the Court appointed a Chapter 11 trustee. Andrews Myers was retained thereafter on behalf of Zoo to salvage the business and the reorganization. From day one, the Firm drove a dual-track strategy: aggressively contesting an expedited sale process that threatened value, employment, and patient care, while simultaneously advancing confirmation of Zoo’s full-pay Amended Plan.
Blocking the Trustee’s Expedited Sale and Resetting Case Trajectory
The trustee sought approval of compressed bid procedures and broker retention that pointed toward a rushed auction and a deleterious outcome for stakeholders. Andrews Myers—on behalf of Zoo—objected, built a robust record demonstrating the availability of value-maximizing refinancing and the operational significance of the hospital campus, and pressed the Court to reset the process. When Zoo filed its Amended Plan and moved to accelerate confirmation, the Court granted emergency relief, advanced the confirmation hearing to January 16, 2025, and confirmed the Plan the next day. The confirmed Plan paid the secured lender and all other allowed claims in full, mooting the auction while preserving hundreds of jobs and continuity of care.
Cutting Administrative Burn and Securing Fee Relief
Beyond stopping the value-destructive sale and achieving plan confirmation, Andrews Myers materially reduced administrative exposure. The Firm successfully objected to the Chapter 11 trustee’s counsel’s fee application; the Court denied the application in full, eliminating a significant administrative claim against the estate and safeguarding Plan feasibility and recoveries.
Outcome and Client Impact
The Court confirmed Zoo’s First Amended Plan under section 1129(a), finding all classes unimpaired and binding all parties. Exit financing was approved, the Effective Date was reached in January, and substantial consummation occurred by February 28, 2025. The result: all allowed claims paid in full, equity preserved, operations stabilized, and the Debtor’s valuable hospital real estate protected from a distressed sale—precisely the strategic outcome Zoo retained the Firm to deliver.
Why It Matters
This case underscores Andrews Myers’ ability to take control of troubled Chapter 11s—particularly where prior counsel faltered—reframe the record, neutralize rushed sale efforts, drive favorable scheduling, and deliver a confirmable, full-pay plan. For equity holders in complex real estate and healthcare platforms, the Firm’s results in Walnut Hills demonstrate decisive advocacy that preserves value, reduces administrative drag, and achieves rapid, durable reorganizations.
