(This story, in slightly different form, originally appeared inIncisive Media's Daily BusinessReview.)

WEST PALM BEACH, FL-Embattled BankAtlantic has sold a$40-million mortgage backed by a retirement community developmentin Delray Beach. It is unclear how much of a loss the bank may havetaken on the note sale.

Some builders and investors are taking advantage of thedistressed real estate market to gain control of properties bybuying the financing at a deep discount. Red Bank, NJ-based KHovnanian Homes last week purchased the BankAtlantic loan securedby 128 lots and 33 homes in Tivoli Isles, a development catering toresidents ages 55 or older.

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