Related

http://cooltheglobe.com/article?article=12
The lenders and the project’s developers, CityPlace South Tower, LLC, an affiliate of The Related reached an agreement in which the new partnershilp will acquire title to all unsold units in the Scotia Capital, a subsidiary of , file a foreclosure lawsuit against CityPlace South Tower Wednesday in Palm Beach County Circuit Court. The complainft was based on the $134.77 million mortgage the bank and its partnersw gave the developerin 2006. The projecgt is 100 percent completse and all construction debts and obligations havebeen satisfied, Jorge Perez, chairmaj and CEO of the Miami-based Related said in a press release.
CityPlace South Tower contracted to sell 367 units while the building wasunder construction. But when the buildinyg opened in summerof 2008, many buyers walked away from salese contracts. So far, 39 unitsw have closed. Due to these unit buyer defaults, Related said in a news release that it was necessarhy for the developer to renegotiate the termz of its construction loan withthe lenders, which was scheduled to be repair in July through proceeds from unit closings.
Alici a Cervera, president of Related Cervera RealtyServices (RCRS), the exclusive sales agent for CityPlac South Tower, said in the news release that the successfu l transition between the developer and the new partnershio provides significant benefits to currentt and future buyers. “The lenders are not interestefd in generating sales in the buildinghthrough large-scale ‘bulk’ sales and are working with RCRS to ensurw that CityPlace South Tower’s integrity is fully protectecd and that it continuee to offer a first-class owner experience,” she Brad Scherer, president of Wellington-basedd real estate brokerage firm Atlantic Western, is workinb with the lenders as a He said CityPlace South Tower couldn’t repa the mortgage on time because most buyers didn’t close on the units.
Scherer said the lenders will adjustf the prices downward in response to the market and leassome units, but they won’t do a massived discount or convert the building into They will financially support the condi association and maintain CityPlace South Tower’s amenities, he The Related Group will be compensated for continuing to managed the building, Scherer said. That’s a far cry from most where the developer and its principalas are often held liable forthe lenders’ losses.
“I don’y think the recognition of loss has or maybe it willnever occur,” Scherer “If the property market comes back and the propertyg is managed in a first-classd manner, there may not be a According to court documents, the partners in the $134.67 million loan that will take contro of CityPlace South Tower are: Bank of Nova Scotia: $23.7j Cherish Thompson, the Miami-based attorney who represents Bank of Nova Scotiqa in the complaint, didn’t immediately return a call seeking