The construction of an assisted living facility in North Las Vegas — a project that never broke ground — has apparently driven the developer into bankruptcy after the architect foreclosed on their mechanics lien.
In 2018, JMA Architects filed a mechanics lien against the owners, Yong Kang Las Vegas Assisted Living Center, LLC, to claim unpaid bills. Shortly after, JMA foreclosed on the lien and won the suit. The courts awarded the architecture firm damages totaling $451,829.80. The court later added nearly $30K in additional damages.
On September 9th, 2020, the owner of the proposed assisted living facility filed for Chapter 11 bankruptcy.
Plans for the North Las Vegas Assisted Living Center were amended several times since they were first approved in 2001. The four-story building was proposed to house 195 units, complete with 300 beds. 20% of the beds were to be reserved for skilled nursing care and the other 80% were designated for general assisted living.
The assisted living center was also slated to include dining areas, an indoor theater, a spa, swimming pool, and communal areas outdoors.
The owners of a neighboring property, Bigelow Aerospace, expressed concern that workers at the assisted living center would need to access the site through Bigelow property. The City’s Planning Commission noted Bigelow’s concern in a 2017 meeting where they approved the project, sending it to the City Council for final approval.
JMA Architects attended the Planning Council meeting on behalf of the owner, Yong Kang Las Vegas Assisted Living Center.
Not long after, JMA filed a mechanics lien against Yong Kang under Nevada’s mechanics lien laws, claiming $284.6K in unpaid wages. After an original contract price of $1,150,000, Yong Kang paid JMA a total of $696.2K, several hundred thousand dollars short of the total price. JMA filed their lien on June 12th, 2018 with the Clark County Recorder’s Office.
A mechanics lien attaches to real property, inhibiting its sale until the claimant is paid. Nevada, unlike some other states, gives architects, engineers, and other design professionals the right to file a mechanics lien.
After Yong Kang failed to pay the remaining balance following the mechanics lien claim, JMA moved to foreclose on the lien. Foreclosing on a lien initiates a lawsuit, and can sometimes end with the forced sale of the property in order to satisfy the unpaid balance. JMA filed a lis pendens on August 8th, 2018.
In March 2019, Yong Kang initiated a counterclaim against JMA, which was dismissed. The court ordered a default judgment in favor of JMA on December 2019, awarding just over $450K in damages, including contract damages, prejudgment interest, attorney fees, and late fees. On August 26th, 2020, the court increased the total to $482.8K.
Yong Kang filed for Chapter 11 bankruptcy on September 25th. Chapter 11 generally involves a restructuring of the business in order to satisfy any outstanding debt and return the company to normal operations. This usually involves paying debts with future income.
According to the Chapter 11 filing, Yong Kang owes more than $2.2 million to a variety of parties. Longsheng Lei, the president of Yong Kang Las Vegas Assisted Living Center, represented the company in the bankruptcy hearing.
Longsheng Lei appears to be very active in Las Vegas, having registered ten separate companies apart from Yong Kang, some of which are inactive, revoked, or dissolved. They include:
- American Central Hospital, LLC
- American Realty Investment, LLC
- Las Vegas Construction Materials, Inc.
- USA First Credit Card NV, Inc.
- Wan Tong Taxi Co.
- American Regional Center—Las Vegas, LLC
- Golden Way, Ltd.
- Nevada Construction Materials, Inc.
- USA Investment EB-5 Fund, LLC
- ShuangHui Group, USA, Inc.
Each company registered by Longsheng Lei in Nevada is located at 2000 S. Eastern Ave. Las Vegas, NV 89104.
Longsheng Lei has also registered a number of companies in California, many of which occupy the same address: 10501 Valley Blvd. El Monte, CA 91731.
JMA Architects declined to comment on the dispute, citing pending litigation.