Portman Makes Peace With The Banks
Embattled Atlanta developer John C. Portman Jr. has dodged a bullet. After a year of haggling with more than 50 banks owed nearly $2 billion on real estate projects around the world, Portman on Sept. 9 signed a restructuring pact with his lenders. The deal lets him keep operating control of most of the assets and provides him with $8.3 million in fresh cash. But the banks made Portman pledge virtually all of his personal assets, including his homes, as collateral. The banks and Portman both are gambling that real estate values and cash flows will rise in the next five years, after which Portman will have to pay more interest that's now being deferred or temporarily reduced. Portman expanded his empire rapidly in the 1980s by tapping lines of credit from Citibank and other lenders typically secured only by his signature.
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