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Bank sues Greenfield developer, saying it defaulted on construction loans

Last Updated 2 weeks by Amnon J. Jobi | Amnon Front Page

GREENFIELD, Ind. (Daily Reporter) — A Greenfield developer who has brought several businesses to the area is being sued by a local banking company, after bank leaders say the developer defaulted on nearly $7 million in construction loans.

According to court records in Hancock County Superior Court 1, Greenfield Banking Co. (GBC Bank) is suing Greenwalt-MKP LLC; Greenwalt Development Group LLC; and Richard Lynn Greenwalt. The lawsuit states GBC leaders are looking to foreclose on the properties surrounding the loans and sell the properties to recoup the losses.

According to Greenwalt’s website, R. Lynn and R. Aaron Greenwalt formed Greenwalt Development Group LLC in 2013 to help Greenwalt Development Inc. pursue more retail/mixed use projects for Greenwalt Corp.

The case involves properties located at the McKenzie Plaza Shopping Center, which the company identifies on its website as an expansion and redevelopment project from 2015 through 2023. The plaza property businesses include Great Lakes ACE Hardware; McAlister’s Deli; FORUM Credit Union; Jimmy John’s Gourmet Sandwiches; Don Rigo Mexican Grill & Bar and an AT&T store.

The lawsuit includes two construction loans that are in default, surrounding only the properties associated with the ACE Hardware and the building housing the McAlister’s Deli and the credit union. The lawsuit, however, notes the legal process will not disturb or stop the operations of those businesses, which have valid leases.

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The civil case was opened Jan. 22 under the supervision of Judge D.J. Davis. There are five counts within the lawsuit: defaults on promissory notes, loan documents and forbearance agreements; foreclosure of mortgage; foreclosure of assignment of leases and rents; appointment of receiver; and foreclosure of security interests in fixtures and personal property.

According to the 12-page complaint, Greenwalt-MKP and the bank entered into certain agreements in July 2022, in which GBC agreed to provide a construction loan to Greenwalt-MKP. The court documents state GBC provided Greenwalt-MKP with an advance on the loan in the amount of $3,656,187, which Greenwalt-MKP promised to pay GBC.

Then, according the the court documents, Greenwalt-MKP and GBC entered into additional agreements in August 2022. In them, GBC agreed to provide a second construction loan to Greenwalt-MKP in the amount of $2,576,832, which Greenwalt-MKP promised to pay GBC.

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The paperwork also states that around early May 2023, Greenwalt and the bank entered into the “First Amendment to Construction Loan Agreement” and an “Amended and Restated Construction Note” — both pertaining to the first loan. Court records also state that around the same time, Greenwalt and GBC also entered into similar documents concerning the second loan.

According to the lawsuit, further amendments came in January 2024 — yet by June 30, 2024, Greenwalt-MKP defaulted on both construction loans.

The paperwork states, “In the Forbearance Agreements, Greenwalt-MKP and the Guarantors agreed and admitted that, Greenwalt-MKP and the Guarantors were indebted to GBC, for the (first loan), in the total amount of $3,678,835.05 as of June 30, 2024; and Greenwalt-MKP and the Guarantors were indebted to GBC, for the (second loan) in the total amount of $2,911,102.24 as of June 30, 2024.”

As of Jan. 21, the balance due on the first loan was at $3,709,482, while the balance due on the second loan is $3,066,757. As of Jan. 21, 2025, the aggregate balance due on both loans was at $6,776,240. With interest the loans will continue to accrue a larger balance at a daily rate of $1,823.47.

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The paperwork states: “The GBC Bank is requesting judgment in its favor and against the defendants Greenwalt-MKP, LLC; Greenwalt Development Group, LLC; and Richard Lynn Greenwalt, jointly and severally, for their breaches of the Construction Loan Documents in the total sum of $6,776,240.16 plus, interest at the per diem rate of $1,823.47 running from Jan. 22, until fully paid, for its reasonable attorney fees and costs of collection, for all other damages provided by the Construction Loan Documents, and for all other relief just and proper in the premises.”

The documents go on to say the rights of GBC constitute a first and prior lien against all rents and profits from the real estate. The bank has asked the court to issue an order foreclosing the interests of the defendant Greenwalt-MKP LLC in the specified items of personal property described.

The Daily Reporter reached out to leaders of Greenwalt-MKP LLC and did speak with Aaron Greenwalt, who did not want to talk about the lawsuit and said he could not comment on pending litigation.

This article originally appeared in the Daily Reporter.