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DALLAS-Behringer Harvard Short Term Opportunity Fund I LP and partner Realty America Group have entered into an agreement with Jel Investments Ltd. to sell 52 luxury condominium units from its Residences at Hotel Palomar. The contract sales price for the real estate is $25.4 million, with closing anticipated Q1 2009.

The sixty-unit tower at 5300 E. Mockingbird Ln. is neighbors with the 198-room Hotel Palomar, which is being operated by Kimpton Hotels & Restaurants of Washington, DC. The hotel, condo component and additional retail total 475,000 square feet and are part of a 5.4-acre, $80 million renovation plan launched in 2005 by Behringer Harvard and Realty America, and completed in 2007.

According to a recent filing with the Securities and Exchange Commission. Dallas-based Behringer Harvard acknowledged that original plans for the condominium portion of the development focused on selling individual units. However, given the downturn in the housing market, as well as falling condominium sales nationwide throughout 2007 and 2008, only eight were sold. As a result, the fund and its partner decided to market the unsold units as a package.

The hotel and adjacent parcel of land is not included in the contract, however. The SEC filing stated that the hotel is doing well and “we are optimistic that an eventual disposition of the hotel and the adjacent undeveloped property will result in an overall positive return to the Fund for the project,” the filing stated. Calls to Behringer Harvard, Dallas-based Realty America and Jel Investments of Vancouver, BC were not returned by deadline.

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