Good observations. That well-written article deserves some more quoting.

John Ferchill, chairman and CEO of Cleveland-based Ferchill Group, did not deny the firm is not repaying the General Retirement System’s $9-million loan. But he said the hotel is performing well and is not at risk of foreclosure.

“We’re not in default, so I don’t know what the problem is,” he said.

Ferchill said the company is abiding by its loan documents, but he declined to explain why the General Retirement System isn’t getting paid if the firm is complying with its loan agreements.

“I don’t want to explain that,” Ferchill said. “Those documents are so complicated, it’s unbelievable.”
What's unbelievable? Not wanting to explain it? Go ahead try us. We're all ears.

Ferchill told pension officials last year that the hotel was able to make payments on the top-priority loan of $50 million to the Michigan carpenters pension trust, although it had not been paying the General Retirement System and other debts connected to the project.

The carpenters trust bought the debt from the original lender on the $50-million loan, iStar Financial. Officials with the Carpenter Pension Trust Fund-Detroit and Vicinity could not be reached for comment.
Meanwhile the Carpenters are doing just fine and the GRS is asked to zip it. If Mr. Orr starts turning over rocks as to why one gets paid and another doesn't who knows what worms will get exposed.

The Ferchill Group had asked the General Retirement System not to declare a default on the loan because it would create a public relations nightmare...

The pension investments are part of a complex package of loans to finance the historic Book Cadillac’s redevelopment. The deals can be traced to a troublesome period for the pension funds, when former Mayor Kwame Kilpatrick and his allies held influence and spearheaded several failed investments.

A federal indictment made public in February 2012 charged former Detroit pension trustee Jeffrey Beasley, who also served as city treasurer under Kilpatrick, with taking bribes and kickbacks in a scheme that cost the two pension funds $84 million in losses. Some of the losses were tied to real estate deals, but the Book Cadillac project is not mentioned in the indictment.
All's well that ends well? The hotel being a financial success could put this all to rest.

Ferchill and two business associates candidly described the hotel’s financial situation during an appearance before the Police and Fire Retirement System in March 2012, one week before the pension fund would begin making interest payments on an unpaid loan it backed to help launch the redevelopment.

Ferchill and his representatives told the board the hotel opened at the height of the recession. But they insisted business had picked up. The occupancy rate had climbed to more than 65% at the end of 2011, well above the market average of 52%.
So show me the money.

Asked on Thursday about the conversation, [George] Orzech — now chairman of the pension board — said Ferchill’s rosy picture of the hotel’s business operations didn’t sit well because the firm wasn’t repaying some of its debts.

“How can you say everything’s great?” Orzech said. “OK, how come you aren’t paying? What are you doing with the money?”