Bank of Hays wants to foreclose on 18 commercial buildings in downtown Hays owned by DFC Holdings Inc.
DFC is the luxury furniture and textile design firm Dessin Fournir led by Plainville businessman Chuck Comeau, widely seen as a champion of reviving downtown Hays and Plainville by restoring historic buildings in both towns.
In a Dec. 13 filing in Ellis County District Court, the bank claims DFC Holdings hasn’t made payments on two loans since July 11, 2018.
A September 2013 loan was for $7.5 million, followed by a December 2016 loan for $949,000.
Through an email from his attorney, Comeau said he couldn’t comment specifically on any pending litigation, but did indicate the company of which he is co-founder and CEO is working with the bank.
“The Bank of Hays, its officers, and its board of directors have been very supportive and helpful through a difficult time for our businesses post-recession,” Comeau said. “This is not a hostile situation. Hays, and the surrounding area, is fortunate to have a financial resource that embraces the role that few banks still provide.”
Also in the filing to foreclose is the Comeau’s Colonial style home at 400 S. Jefferson in Plainville, an early project of Comeau and his wife, Shirley, that was featured once in Architectural Digest.
Another foreclosure filing by Sunflower Bank is awaiting summary judgment in Ellis County District Court. It names seven properties in Plainville.
DFC’s headquarters at 308 W. Mill St., Plainville is not included in the filings. Comeau said in his comment that the real estate development firm he founded, Liberty Group Inc., is current and in good standing with respect to all of its real estate loans.
“I am blessed with an incredibly supportive staff in rural Plainville that has been competitive on a national and international level for 25 years,” Comeau said. “This is just one of many hurdles we have faced, and it is our intent to overcome this one as well.”
For its accomplishments over the years, Comeau and DFC have been written about in The New York Times, The Wall Street Journal, Architectural Digest, Money and other major publications.
Sara Bloom, executive director of Downtown Hays Development Corp., declined to comment on how the lawsuit might affect downtown, but indicated she’s optimistic.
“Downtown is thriving,” Bloom said, “and we look forward to working with any developer in downtown to keep the area moving in a positive direction.”
Sarah Cearley, the owner of Simply Charmed and Bella Luna, both at 1011 Main, said there won’t be any disruption to her business, despite the building being part of the lawsuit.
“We had a fantastic 2018 and we’re looking forward to 2019,” Cearley said. “It’s business as usual, we’re always doing something new and different. We’re getting ready to go to Atlanta and Dallas market, so we’re planning on a successful year, and bringing in a lot of new inventory, and to continue changing and evolving.”
Likewise, Norman and Sandy Keller, the husband and wife owners of Regeena’s Flowers at 1013 Main, another building in the suit, said they’d heard about the foreclosure but it’s not affecting their business.
“For us, it’s business as usual,” Norman said.
For the past several decades, Comeau’s knack for design and historic restoration has turned dormant buildings in downtown Hays and Plainville, including a shuttered car dealership, grocery store, meat locker, retail stores and a donut shop, into inhabited offices and storefronts.
“I have always been and will continue to be an ardent advocate of downtown Hays,” Comeau said in his statement. “Its redevelopment was one of the first of its kind and I’m very proud of the progress we made.”
The town’s continued success is not dependent on his company, he said, noting, “We are just happy to have been a part of its revitalization.”
Bank of Hays seeks to accelerate repayment of the loans, and is seeking a sheriff’s sale if they aren’t paid within 14 days of a court judgement on the request for foreclosure.
According to the filing, DFC Holdings still owes more than $6.43 million on its first loan, plus more than $189,000 in interest. It owes $888,481 on the second loan, plus $59,394 in interest.
The attorney for the Bank of Hays, Creath Pollak, Minter & Pollak L.C., Wichita, declined to comment on the case.
Business partners and brothers David and Jacob Proffitt, who recently purchased the historic Fox Theater to develop into a high-end lounge for about $800,000 at the north end of Main, said they are interested in buying the buildings for development.
“We definitely would like to have them,” David said.
“We’ve got some ideas,” Jacob added.
What would they do with them?
“The only thing we can assure you, is if we end up with the buildings, they won’t stay empty,” David said. “We’ll do something right with them.”
Other Comeau companies named in the suit include Oak Street Planing Mill L.L.C., DFC Corp., Palmer Hargrave Inc., Dessin/Fournir Inc., Liberty Group Inc., Classic Cloth Inc., DFC Distribution L.L.C. and C.S. Post Inc.
Besides the buildings, the Bank of Hays filing says security on the loans includes all company assets, accounts, inventory, equipment, furniture, fixtures, leases, rents, a $6 million life insurance policy on Comeau, and tangible and intangible property.
Others that may have claims against the property and assets include Sunflower Bank N.A., Emprise Bank, the City of Plainville, Midwest Community Bank, Golden Belt Bank, Wilson State Bank, the lawsuit says.
The Hays properties listed in the filing are: 803 Fort St., 811 Fort St., 1008 Main St., 1011 Main St., 106 W. 11th St., 1100 Main St., 1102 Main St., 1107 and 1109 Main St., 1111 Main St., 106 W. 12th St., 719 Main St., 1108 Main St., 1013 Main St., 121 E. 11th St., 1012 Main St., 110 W. 11th St. and 201 E. 12th St.
Besides the residence, the other Plainville property named is 108 N. Main.