On Tuesday night, Green Bay City Council approved the Hotel Northland project to go into receivership, which is the requirement the unofficial new senior lender held to go forward with financing $16.5 million for the project.
The vote passed 7 to 5.
City Council has been searching for a new senior lender to fund $16.5 million of the project, and Octagon, a financial planning firm based in Virginia, has showed interest in taking on that role.
However, during the council meeting, one of the partners with Octagon stated firmly that they would not consider taking on the role of senior lender unless the project was put into receivership that is appointed by a judge.
A receiver would essentially act as a neutral third party and would take control of the project and oversee all its finances.
Mayor Jim Schmitt said he already has a receiver in mind to take the reigns on the project.
Keith Harenda, the owner of Hotel Northland, said KPH Construction will have to review the receivership plan before they decide if they will agree to it or fight it in court.
The alternative option that was presented to council came from Mike Franz, former co-owner of Hotel Northland.
Franz said he has the funding and backing to become the new senior lender on the project.
City Council members agreed that Franz would need to speak with his former partner on the project, Keith Harenda, about the offer, with whom he had a legal battle with over Hotel Northland ownership.
However, now that the receivership plan is approved, the path has been cleared for Octagon to become the new senior lender.