414-unit luxurymultifamily project in the Bailey's Crossroads submarket ofFairfax. At the time it was said to be a $100-million-plusproject.

The project was capitalized with $14.8 million of equity,according to an SEC filing, of which Fairfield Residential provided$3 million. BREOF Baileys, LLC, a third party unaffiliated with BHor the developer, contributed $11.8 million in cash; in additionthe project was also capitalized with a senior loan for up to$110.7 million. Fairfield Residential provided a repayment andcompletion guaranty to the senior lender for the project and acompletion guaranty to Baileys Venture as mezzanine lender.

Fairfield's financial strength deteriorated significantly sincethat time and by September 2009, it had triggered a technicaldefault under the repayment and completion guaranty to the seniorlender, the filing stated. That, in turn, triggered a technicaldefault on the senior loan and the mezzanine loan made by BaileysVenture.

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Erika Morphy

Erika Morphy has been writing about commercial real estate at GlobeSt.com for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.