Palm Beach Condos to Appear in Foreclosed Home Search Lists
The number of Palm Beach condo units appearing in foreclosed home search lists is expected to increase as Florida condo developer Related Group continues to face financial difficulties.
Because of the glut of low-priced foreclosed homes, condo developers in Florida and in other parts of the country have not been able to sell condo units according to plan, leaving them with little cash to pay their development loans.
Last week, Broward Judge Ronald Rothschild was asked by the Beach Club association to take over three Beach Club condo units in Hallandale Beach to pay for construction repairs that were not carried out by developer Related Group.
The Beach Club is a condo project built by Related Group in 2005, with room sizes ranging from 800 square feet to 4,000 square feet and with prices ranging from $900,000 to over $2 million.
Last month, more condo units were added to foreclosed home search lists when the 420-unit CityPlace South condo developed by Related was foreclosed by Canadian investment firm Scotia Capital after Related Group failed to pay its $119 million development loan.
In 2006, Related Group borrowed approximately $135 million from a consortium of lenders led by Scotia Capital to develop CityPlace with the plan of using cash flow from condo sales to pay the loan. But because of fierce competition from bargain-priced foreclosed home search properties, Related was able to sell only 39 condo units, leaving Related without cash to pay its loan.
Related Group has other financial problems with its other condo projects, highlighting the situations of condo developers caught in the maelstrom of low-priced foreclosed home search properties.
In April, the association of Beach Club Two sued Related Group for unpaid maintenance costs for the three condo units. Related Group entities that were included in the suit were the three TRG-Hallandale Beach subsidiaries and building contractor John Moriarty and Associates.
Officers of the three Beach Club associations said that Related Group had been a reputable company before the foreclosure crisis battered its finances. They said that the company had always sent its general contractor to solve maintenance and construction problems. But it seemed that the company is no longer doing something to protect its reputable name, the officers said.
In an interview with the media last month, Related CFO Matt Allen explained that the real estate development company is negotiating with other lenders to save its condo projects from foreclosed home search lists.
Related Posts:
- Property in Foreclosure in Oakland – A Great Buy
- New York Foreclosed Homes Auctions May Include Condos
- Do Your Foreclosed Home Search in Cities That Care
- Find Foreclosures in Honolulu by Considering Condos
- Goldman Sachs Settles Complaints over Foreclosure Lists
