Former EF Hutton suspends operations, in $12 million debt

Mortgage company wants to inspect EF Hutton Tower, sell building

A mortgage company attempting to foreclose on one of the largest buildings in downtown Springfield is asking the court to award them the building, and court filings might give clues about the future of the building.

PS Funding Inc., which is in the middle of a foreclosure suit levied against EF Hutton in relation to EF Hutton Tower, asked the Clark County Common Pleas Court to rule in their favor and for the court to allow them to inspect the premises to figure out the best way to sell it.

EF Hutton admits it has not paid mortgage on Springfield building

The foreclosure lawsuit filed in April by Peer Street Funding Inc. alleges Hutn, Inc., who has owned the building since September 2016, owes PS Funding more than $4.6 million on a mortgage the company took out in 2018.

“Defendant Hutn, Inc., formerly known as EF Hutton America, Inc., has defaulted under the terms of the note as well as the security agreement,” the lawsuit states. “There is due to the plaintiff, $4,656,000, plus interest at the rate of 18 percent per year from November 1, 2018….”

EF Hutton Tower is 10-plus stories in the heart of downtown Springfield and commonly known as the former Credit Life Building.

In a response to the foreclosure lawsuit filed against it, EF Hutton admitted that it has defaulted under the terms of its contract with a real estate company and that the company has rightfully accelerated the debt. The answer prompted PS Funding to ask the court for judgment.

“Defendant states in its answer that it is not disputing the debt and that it is thus liable to plaintiff …” the motion says. “Defendant raises no defense to the plaintiff’s complaint and only gives more weight to the plaintiff’s allegations of default under the payments of the loan. Defendant continues to have an obligation under the promissory note to plaintiff”

In another filing by PS Funding, it asked the court for an inspection of the property.

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“Plaintiff reached out to defendant Hutn Inc. through counsel in late July regarding a mutually convenient time for an appraisal/inspection with a … review to be conducted of the subject premises,” the motion says. “Unfortunately, Defendant Hutn, Inc. has been unable or unwilling to arrange such an appraisal/inspection which would assist plaintiff in the decision as to how best sell said premises.”

The Springfield News-Sun reached out to both attorneys for EF Hutton and PS Funding but didn’t hear back from them.

Hutn, Inc. purchased and moved into the building in late 2016. The move came with the promise of more than 400 new jobs and many city and business leaders believed the company would help rejuvenate downtown. However, the company failed to get its footing in a number of industries including trading stocks, social media and cryptocurrency.

The financial company also owes SpringForward around $7.5 million on an unsecured note. The two sides said they have been negotiating to settle the debt. 

SpringForward received the building for free by way of a donation from Jim Lagos and his wife, Nike, and sold the building to EF Hutton with an agreement that EF Hutton would pay them back over a period of years. EF Hutton suspended operations in April.

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