Via Mizner apartments (right), the only completed building of the three shown in this rendering of a finished complex, is the subject of a foreclosure notice. But Penn-Florida said it intends to repay the loan involved. Still under construction are the branded residences (left) and the Mandarin Hotel (center). Rendering provided
By Mary Hladky
Penn-Florida Companies faces losing ownership of its luxury apartment building that is part of a three-phase project that would also include a 164-room Mandarin Oriental hotel and 85 branded residences along Federal Highway in downtown Boca Raton.
An affiliate of Blackstone Mortgage Trust provided a $195 million senior loan to Penn-Florida in 2022. It filed notice on Dec. 1 that it has initiated a Uniform Commercial Code foreclosure on the 366-unit apartment building for failing to pay off the loan. The notice said an auction will be held on Jan. 15.
A UCC foreclosure typically moves more quickly than a foreclosure case filed in court. An auction is held to sell the property to the highest bidder so a creditor can recover the money it loaned.
Penn-Florida, headquartered in Boca Raton, issued a statement shortly after the notice was filed indicating it does not expect to lose the 101 Via Mizner building, which was completed in 2018 at 101 E. Camino Real.
“This was a loan in good standing that recently matured and is in process of being repaid in-full next month (January)through a refinance,” the company said.
The auction notice is the latest headwind for Penn-Florida, which originally planned to complete construction of the Mandarin Oriental hotel and condos in 2017. The completion date has been delayed five times and now is slated for the end of 2025.
Construction has proceeded very slowly for years, frustrating city residents who consider the project an eyesore. Penn-Florida has insisted that nothing is amiss.
But some buyers who had placed large deposits on Mandarin Oriental condos have grown tired of waiting. Four couples and an individual filed lawsuits last summer seeking the return of their money.
Two couples voluntarily dismissed their cases, indicating they had reached confidential settlements with Penn-Florida.
The cases of two other couples and an individual, all represented by attorney James Ferrara, a former Palm Beach County Circuit Court judge, remain open. Their cases were consolidated in November.
Ferrara said it is more efficient to consolidate. “It did not make sense to have three separate cases that involved the exact same issues,” he said.
In November, another couple who had made a nearly $1.7 million deposit filed a seven-count suit alleging, among other things, fraudulent inducement and constructive fraud. They seek an unspecified amount of damages.
The litigation against Penn-Florida is not limited to would-be condo owners.
Areda Construction of Miami Lakes and Strategic Group Builders of Miami in August filed suits claiming they had not been paid for completed work. Both of those lawsuits were voluntarily dismissed.
In other cases that remain open, C&C Concrete Pumping of Florida and Texas filed two suits in late September, saying it had not been paid for work done on the condo and hotel buildings. Power Design Inc. of St. Petersburg also filed two suits in mid-September against Penn-Florida and its general contractor, Straticon LLC, saying it had not been paid for electrical work at the two buildings.
Crane rental company Maxim Crane Works, headquartered in Wilder, Kentucky, sued Penn-Florida and Straticon in November for non-payment.
The three companies seek payment in total for $4.8 million they claim is owed them, as well as unspecified damages and attorneys fees and costs.
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