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Construction lender Wachovia Bank has filed a foreclosure lawsuit on the remaining 285 units in the new 42-story Wind by Neo condominium tower in Greater Downtown Miami, according to Miami-Dade County records.
The suit names as defendants the condo tower’s developer, Neo Epoch 2 and its members Lissette M. Calderon, Maria T. Calderon, and Frank Guerra, along with nearly two dozen contractors who are or were working on the project, according to the South Florida Business Journal.
Wachovia seeks “damages for breach of a loan agreement; damages for breach of Notes; [and] to foreclose a mortgage, as recorded in Public Records of Miami-Dade County, Florida,” according to the suit.
Wachovia Bank, the troubled lender that was purchased by Wells Fargo Bank in October, filed the Lis Pendens action, or notice of default, at 2:51 pm Nov. 26, 2008, which was the Wednesday before the Thanksgiving holiday, according to the government records.
Neo Epoch 2, an entity specifically created to build the Wind project by the same individuals from the successful Neo Lofts and Neo Vertika condo towers, obtained a $115 million construction loan from Wachovia Bank in October 2005, according to government records.
Construction on the 489-unit project began in January 2006, and the developer filed the final condominium documents with Miami-Dade County in February 2008. The first closing occurred shortly thereafter on March 5, 2008.
Neo Epoch 2 has closed 204 residential units and four commercial units through Nov. 21, 2008, according to Condo Vultures® LLC’s Official Condo Buyers Guide To Miami.
“We are surprised by the foreclosure action given that the Wind has closed about 42 percent of its total units in a nine-month span,” said Peter Zalewski, a principal with the Bal Harbour, Fla.-based consultancy Condo Vultures® LLC. “Given the current state of the South Florida condo market, any developer who can close an average of 23 units a month really isn’t doing all that bad.”
Greater Downtown Miami is what many consider the epicenter of Florida's condo crash. Between 1963 and 2002, developers built 11,500 units in a 60-block stretch of Greater Downtown Miami. Since 2003, developers have completed or are constructing nearly 23,000 units, pushing the area's total inventory of high-priced units to nearly 34,500.
To date, 17,300 units have been completed with a 70.3 percent closing rate. An additional 4,000 units are coming online early in 2009, and the remaining 1,500 units bill be delivered by 2010.
The Wind is one of three towers (six towers are approved) standing on a 13.5 acre tract on the north bank of the Miami River and immediately west of South Miami Avenue. The site at one time was considered for a possible location for a new Florida Marlins baseball stadium, which instead is being developed in Miami’s Little Havana area.
Peter Zalewski is a principal with the consulting company Condo Vultures® LLC and a licensed real estate broker with Condo Vultures® Realty LLC. Peter can be reached at 305-865-5629 or by email at peter@condovultures.com. Be sure to check out Peter’s blog at CondoDump.com. Don't forget to sign up for our weekly Market Intelligence Report. Looking for a property at a deep discount? You are encouraged to take a peek at the Vultures Database™ .
Copyright © 2008, Condo Vultures® LLC
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