An appeals court judge ruled Friday that a bankruptcy court should consider additional evidence in the chapter 11 filing of a Bronx real-estate project that could potentially disqualify the case, WSJ Pro Bankruptcy reported. The project’s developers, who filed the appeal against the lender-backed bankruptcy filing, didn’t get their desired outcome of an immediate dismissal, but the ruling also didn’t kill the possibility for the case to be thrown out. Judge Ronnie Abrams of the U.S. District Court for the Southern District of New York said the developers of the project at 286 Rider Avenue filed new materials “critical to the underlying determination [of] whether the bankruptcy case was properly authorized” after bankruptcy judge Lisa Beckerman allowed the case to move forward. Judge Abrams said that she was sending back the case because Judge Beckerman of the U.S. Bankruptcy Court in New York didn’t have an opportunity to review the materials before her ruling. The bankruptcy case threatens to strip the developers, Toby Moskovits and Michael Lichtenstein, of their equity interest in the property where they had planned to build a 105-unit apartment building. Joyce Kuhns, a lawyer representing Ms. Moskovits and Mr. Lichtenstein, told Judge Abrams on Thursday that the developers needed this case resolved quickly because they were facing a tight deadline. A lucrative tax exemption program known as 421a, which applies to developers in New York City who build multifamily housing on underutilized land, is set to expire in June, and its future is uncertain, Ms. Kuhns said in an oral argument. To qualify for the current exemption, projects must commence construction on or before June 15.
