The good news is that at least URHS would be a secured creditor - in the first group that gets paid after the lawyers and court [edit] before the banks.

The bad news is that you might get some money on what you're owed for the lease but you'd likely be on your own to get your stuff back. But that might depend on how good your lawyer is (and they'll take a chunk of your cash, too).

URHS is probably so far down the list, it's laughable. I can't tell you how many businesses I know who are owed serious money by IPH. URHS willingly leased these units to IPH knowing its reputation, and there were problems of non-compliance with the lease well before the house of cards fell down on Ed Ellis. If these units are ever shipped back to URHS, I'll be amazed. Hell, URHS may even have them scrapped where they sit just to recoup money for the organization.

Yes, as much as we fans see museums and other non-profits as the ones who should be paid because they scrape by on a daily basis (at best), the biggest "donors" (IRS, banks, et al) will be the only ones who see a dime when all is said and done.

If the URHS Fs are serviceable, their best bet to rescue them might be to get someone to take up a lease and ship them from the current site.... Of course, there may be issues with that affecting their case or something....but, it would minimize the potential for damage or loss of them...

Since the URHS purportedly knew of the risks involved in leasing to IPH at the time the lease contract was created, does the URHS have deposit monies from IHP in an account that they can use to retrieve their property or will they likely have to resort to scrapping in place?

I'm not in the URHS, but I do recall seeing meeting minutes during which the organization's leadership expressed concern over non-payment by IPH. I should clarify what I mean by "Knowing IPH's reputation." I didn't state that well last night.

My intention was to say that IPH had a long-running history of non-payment to everyone from small contractors to government agencies by the time URHS leased these units to IPH.

Sandy states it well-- the only real hope these units have is a "rescue mission" undertaken (and paid for) by URHS or a benefactor. And I suspect the money to do just such a mission is not lying around in the URHS coffers. I could be wrong, though.

Another concern I would have is that the present operator of the Grenada line (latest iteration of RailAmerica with John Marino at the helm) could put a lien on the units for non-payment of storage fees. Somehow I doubt the company has been storing these units out of the goodness of their heart.

Those were the F40PHMs which had the noses modified with steps added and a nose door for freight service. These were rebuilt for Iron Roads' Canadian American Railroad (CDAC).

If memory serves correct, IPH sent 4 of them out for rebuild into two mother-slug combos. One set was involved in a grade crossing accident on the Piedmont Northern, an operation which IPH folded a few years ago and is now operated by Progressive Rail of Minnesota.

To the best of my knowledge, that wrecked set is still sitting in Ranlo, NC. I'm not sure what became of the others. They were not very reliable for IPH. Frequent mechanical issues. To quote the GM at the time when I expressed my like for those units, he said "We'll let you take a couple home with you."

S&NC had two F40PHs

Instead of complaining about prices on Ozarkmountainrailcar.com, how about thinking about how many peices of equipment OMR has helped saved from getting cut up over the last 23 years.

To complain is to be human, it's part of our nature....
While some of us believe the prices to be insanely high, the fact is it is not Ed or IOU Pac. Calling the shot, this is the Receiver looking to make back the investors money....
I would bet on much of this stuff going for maybe 25% or less of the current prices....
Make your offers now, no matter how low....as long as it's above scrap value...
As time goes on, the Receiver will become more open to lower offers...possibly even the offers of scrappers....Remember, their job is to recover any money possible, not to preserve anything....

Much like a realtor, a brokers job is to develop a strategy that will maximize
a seller's net proceeds based on the brokers knowledge of the industry. List
prices are often set by both the seller and or broker. And often are based on historical
sales data and current market conditions. The biggest issue in the tourist industry is capacity. There are not enough operational cars to meet demand (especially for Polar). So these are some of the key items taken into consideration when determining a market value. If I sound like I know abit about the sale of rail equipment its because I do, I own Ozark Mountain Railcar.
John Suscheck /CEO
Ozark Mountain Railcar

Yes, "In the street of the blind, the one-eyed man is called the Guiding Light."

I remember chatting with a rail preservation Guiding Light many, many years ago who said that, in the future, he who owns passenger coaches will be King of the World!

Yes, most of the listed prices are in la-la land. My WAG is that the creditor who is owed $ 5M (plus interest) won't wait very long before ordering the stuff auctioned off to the highest bidder with no reserves.

When that happens then you'll know " what it's worth".

Keep your powder dry.

Ross Rowland

It is commonly stated that, "Past performance is no guarantee of future results." This is a timeworn truth of any financial market. If, as you state, your prices are based on historical sales data (comps), do they reflect your belief that the passenger equipment market is flat (prices steady), cooling down (prices declining), or heating up (prices on the rise)?

It is interesting that you specifically mention Polar as a driver of market price. IPH passenger railroads ran Polar holiday excursions as part of their mix of offerings. One would expect that a person with operational experience such as Mr. Ellis would have a higher probability of success than average, yet Rail Events, the license holder of Polar Express, has taken his company to court to recoup licensing fees that it alleges have remained unpaid. So the demand for this type of equipment that you assert would driven by specialty trains such as Polar would be tempered by the economic reality that capital equipment costs will not necessarily be readily recouped.

While mentioning Polar as an example of a market consideration that would support passenger rail equipment prices, you did not mention Amtrak's rule changes for passenger excursions on their routes. To the uninitiated, this would appear to result in an increase in supply and decrease in demand as it would appear that some businesses using this type of equipment to run excursions over Amtrak routes can no longer operate.

Given IPH's apparent dire economic condition, one possible conclusion is that paying anywhere near what they paid for the equipment would put the buyer on a similar path to insolvency and so the market price for any purchaser looking to remain in business for the foreseeable future should likely be far less than what Mr. Ellis paid.

I would not look at this "mess" in terms of the market...I would look at this in terms of somebody making some really poor business decisions. From the beginning of the IPH expansion bills were going unpaid and vendors were getting shut out. It's hard to talk about without slandering somebody BUT...it would seem like this business was doomed from inception. I (and others) have been waiting for this scenario to happen for a long time.
Railroad car prices are always unpredictable. The free market will shake it out in the end.

T7

In the interest of providing some more information on the listed equipment that started this thread, a post on another discussion board a week or two back led me to the Recordations section on the Surface Transportation Board website. Documents filed there show that a business court in Michigan last October issued a judgement against IPH awarding Varilease Financial $3.2 million plus 23 railcars and 17 locomotives. This past July Varilease sold the equipment to Sandton Rail Company LLC, c/o Sandton Capital Partners LP of New York. Based on this it appears Sandton is the company now selling the equipment through Ozark Mountain. The filing shows the subject equipment to be re-stenciled with SDCX reporting marks, reports are that at least some of the cars on SLRG have been so re-marked.

The filing to the STB documenting the sale to Sandton and including the court order can be seen here:

https://www.stb.gov/recordations.nsf/ec ... /33406.pdf

Big Shoulders Capital has liens on an additional 85 pieces of IPH equipment recorded with the STB under a Fourth Forbearance Agreement dated July 2018:

https://www.stb.gov/recordations.nsf/ec ... /33060.pdf

...though it appears IPH has satisfied the liens against one of the pieces covered in the above document, identified as "F9/F7A locomotive marked and numbered SLRG 9163".

https://www.stb.gov/recordations.nsf/ec ... 3060-A.pdf

I *think* it's been reported elsewhere that Big Shoulders is the lender chiefly responsible for placing IPH into receivership, but I'm not positive on that.

IPH did have some former New Jersey Transit (I think) F40s or some variation thereof, a half dozen or so ended up on SLRG. They were apparently leased and are being returned to the lessor now.

Jeff Moore
Elko, NV