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Foreclosure lawsuit filed against Miami property developer

Purchasing commercial real estate in Miami can be a sound business investment. Companies or investors that purchase property rather than an existing structure or business have the opportunity to develop it from the ground up. However, as with any type of financial or real estate transaction, problems can sometimes occur.

One Miami company is now facing a foreclosure lawsuit after it failed to make payment on a loan. The purchaser acquired property near the city’s Edgewater neighborhood for $34 million in 2015 with plans to develop it into a hotel and retail center. The site comprises more than seven acres. To date, no development has taken place on the property although the reason why is not known.

The seller of the property financed the deal. The loan matured after two years and the developer has failed to make payment in full of the $34 million. If the developer is able to refinance the loan through a new lender or sell the property to a new owner, it may be able to repay the original loan and avoid foreclosure. Up to 3 million square feet of developable space on the property is up for grabs if zoning approvals are obtained.

Purchasing or selling a property can be complicated and the contract negotiation process can be lengthy. In addition, securing financing is not always easy. Companies who are looking to buy or sell commercial real estate in Miami may wish to contact an experienced attorney.

Source: South Florida Business Journal, “Miami development site targeted with $34 million foreclosure,” Brian Bandell, Jan. 26, 2017

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