By Mary Hladky
Penn-Florida Companies is facing new lawsuits filed by both the group of lenders and the construction manager for the Mandarin Oriental condos that are being built in Boca Raton on Federal Highway a few blocks north of Camino Real.
In its July 17 complaint filed in Palm Beach County Circuit Court, Via Mizner Lender 1 LLC, the administrative agent for a group of lenders, wants to foreclose on a mortgage Via Mizner Owner III, the Penn-Florida affiliate building the condos, secured in August 2023. It seeks $417.7 million to repay the original $270 million loan plus interest, advances and fees.
Penn-Florida stopped making interest payments on the loan in June 2024 and failed to pay off the full amount as promised in September 2025, the lawsuit says.
The unfinished Mandarin Oriental condominium building, to the left, and the hotel, to the right, as seen in May. Larry Barszewski/The Coastal Star
And in a July 6 complaint also filed in Circuit Court, Strategic Group Builders is seeking $24.1 million that it says it has not been paid for its work, as well as interest, costs and attorneys’ fees.
The lawsuit names as defendants Via Mizner Owner III and four project lenders that the lawsuit says stopped making monthly payments to Strategic Group without giving notice.
Strategic Group, which has offices in Miami and Boca Raton, recorded a lien against the property when Penn-Florida and the lenders stopped paying. The lawsuit seeks to foreclose on that lien. Its five-count complaint includes a breach of contract claim.
The lawsuit also notes that Strategic Group stopped providing labor, services and materials at the condo site prior to May 6.
Separately, a Palm Beach County Circuit Court judge has ruled in favor of a couple seeking return of a $1.98 million deposit they made on a Mandarin Oriental condo unit.
Judge James Sherman’s June 29 ruling states that Douglas and Debra Jacobs can demand payment from the title companies holding their deposit money.
But attorney Robert Sweetapple, who represents Via Mizner Owner III, has filed a motion for rehearing.
In that pleading filed on July 9, he contends that Sherman made legal errors that include contract misinterpretation.
Sherman’s analysis of the case found that arguments made by Via Mizner Owner III — concerning why the Jacobses are not entitled to get back their deposit — are erroneous, insufficient or without adequate evidence.
Sherman’s ruling came shortly after Nilesh and Liliana Undavia settled their legal case against Via Mizner Owner III following an arbitrator’s determination that they were entitled to compensation and interest, according to court records.
The Undavias, who had placed a $1.65 million deposit on a condo unit, are to be paid by Jan. 7, or within 30 days of Via Mizner refinancing or obtaining additional financing for the condo construction.
If that doesn’t happen, they will be entitled to a consent judgment for breach of contract for the amount due to them.
Eight other buyers also have settled their lawsuits against Penn-Florida, but the settlement amounts are confidential. The Undavia case was the first to reveal settlement terms.
But the lenders’ foreclosure action seeks also to undo any claims by what it calls “purported junior lienholders” including Strategic Group Builders and “purported contract purchasers” of condo units including the Undavias.
“The mortgage is a lien superior in dignity to any prior or subsequent rights, title, claim, lien, or interest arising out of borrower,” its lawsuit argues.
Yet another legal case, this one concerning the Mandarin Oriental hotel that is under construction next to the condo building, is underway in U.S. Bankruptcy Court.
Penn-Florida affiliates Via Mizner Owner II and Via Mizner Pledgor II filed for Chapter 11 bankruptcy protection last December after they were unable to repay lenders about $210 million at loan maturity. Under an agreement with their senior secured lender, TIG Romspen, the affiliates have been given time to seek refinancing or recapitalization and they sought to push back the date of the property auction.
On July 7, the date of the property auction was extended to Aug. 14 and a hearing to approve the sale was extended to Aug. 21.
Steve Plunkett contributed to this story.
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