Gay Publisher in
"Receivership" With Feds

An investment fund that finances Window Media, the owner of several gay publications including the Washington Blade and Genre magazine, is going into "receivership" by the Small Business Administration. The government agency will then sell off the fund's assets, redistributing the proceeds to investors.

Gay City News in New York reports that Avalon, the investment firm, has been entrenched in a "continuing violation" with the SBA. Avalon constantly borrowed money from the SBA, from 2000 to 2007, eventually culling $38 million to acquire more properties and other ventures. As part of the deal with the SBA, Avalon was required to have at least half of the value of the loan in assets, but Avalon's assets fell below the required $19 million.

A lawsuit filed against Avalon by the SBA shows that the company had little money left by 2008, as investors pulled out of the fund, and other properties the company invested in had lost value.

Window Media owns the Washington Blade, Southern Voice, South Florida Blade, David Atlanta, 411 Magazine, and Bitchsession.com.

Avalon also has a non-majority stake in HX Media, which publishes HX magazine and the New York Blade. Unite Media owns the majority of shares for HX Media.

According to the report, a typical receivership spans a 3 1/2 year period, depending on the economic climate and the state of Avalon's assets. The SBA usually recovers 63 cents per dollar for investors and taxpayers. (Michelle Garcia, Advocate.com)