Fresno’s Assemi family appears to be in deep financial trouble, according to a new filing in federal court.
Court documents filed by Prudential, an Assemi lender, alleged the family has defaulted on over $705 million in loans this year.
The big picture: In a petition alleging breach of contract, Prudential asked a Federal judge to appoint a receiver to manage over 50,000 acres of distressed farmland that are part of the Assemi empire.
- The claim, which was filed in the Eastern District of California court on Monday, says one of the loans has been in default since February, while the other ones have been in default since June.
- Prudential claims the default is due to the Assemi family not paying one of the loans in full upon its maturity, failing to pay the semi-annual payments due on July 1 for all but one loan and defaults on loans with third parties, which has caused around $150 million to be accelerated.
- The Assemi family has allegedly told Prudential that it may stop farming the land, which has pistachio and almond trees, because of operational cash flow issues. That may also lead to the Assemi family letting go of its agricultural workforce.
By the numbers: One loan Prudential made was for $550 million in western Fresno County in March 2022.
- None of that money has been repaid as of July, and nearly $10 million in outstanding interest has accrued on it.
- Prudential also gave the Assemi family a $91 million loan for land in Kern and Tulare Counties in January 2020.
- The outstanding principal amount as of July was nearly $73 million, with over $1 million in outstanding interest accrued on it.
- PGIM Real Estate Finance LLC gave the Assemi family an $84 million loan in August 2020, with nearly $61 million outstanding plus another $5 million in interest.
- U.S. Bank also gave the family a loan worth at least $149 million in 2019. As a result of U.S. Bank Defaults, the bank accelerated the $149 million to be immediately due.
Go deeper: Prudential says in the filing that the trees on the Assemi property need to be watered regularly in order to take them to harvest, which takes place anywhere from late August to early October.
- The Assemis will need to harvest the pistachio crop within the next several weeks, which would require them to spend significant amounts of money.
- But Prudential believes the Assemi family does not have the money to harvest their pistachios.
- Prudential says that under California law and the loan documents, it has the right to appoint a receiver to take possession of the property. The company plans to provide funding to the receiver to allow it to complete the harvest.
Flashback: Major cracks in the Assemi farming empire appeared publicly in February, starting with The Sun’s report that it was looking to sell tens of thousands of acres of farmland.
- The family also put Touchstone Pistachio Company up for sale.
- The Sun reported at the time that the value of the land and nut processing company came in at around $2 billion at the time.
Read the complaint:
