Thank you for sharing!

Your article was successfully shared with the contacts you provided.

TEMPE, AZ-Centerpoint Condominium developer Avenue Communities LLC plans to file suit today against lender Mortgages Ltd. According to a press release issued by Avenue Communities, the developer’s claim is that Mortgages Ltd. and its investors defaulted on a $1.5 million payment, part of a settlement struck by the frustrated developer and bankrupt lender last fall.

The release notes litigation documents claim Mortgages Ltd. defaulted on its funding obligations for the 275-unit Centerpoint Condominiums at 110 E. Seventh St. in 2007 by failing to fund loan draws in full before funding finally ceased. In the meantime, Mortgages Ltd. filed for Chapter 11 bankruptcy in June, following the suicide of founder and CEO Scott Coles.

A call to Richard Feldheim, president of Mortgages Ltd., was not returned by deadline.

The Avenue Communities statement also notes that in fall 2008, Avenue Communities and Mortgages Ltd. struck a $75 million deal which was to have been curative of Mortgages Ltd.’s original funding breach. However, except for $2.8 million in financing granted on September 2 through bankruptcy court, there has been no money forthcoming from the troubled lender. Furthermore, the statement notes, hearings continue to be delayed.

“Mortgages Ltd.’s default on its funding obligations has already cost us tens of millions of dollars in damages,” says Ken Losch, principal of Avenue Communities in the press release. He adds that with no progress on the settlement agreement and continued hearing delays, Avenue Communities had no choice but to file suit. “Mortgages Ltd. is in default with us; yet they are not working toward a resolution,” he comments.

Avenue Communities launched construction on Centerpoint in 2005. The developer has so procured $22 million in pre-sale commitments for condominium homes. Losch expects to move forward on construction of the project, with plans to open Tower One in spring 2009 and the retail plaza level during summer 2009.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 3 free articles* across the ALM subscription network every 30 days
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?


Join 1000+ of the industry's top owners, investors, developers, brokers & financiers at THE MULTIFAMILY EVENT OF THE YEAR!

Get More Information


Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2020 ALM Media Properties, LLC. All Rights Reserved.