Monday, May 21, 2012

VUE Charlotte foreclosure auction set

The luxury condominium tower The Vue is set to be sold at public auction at 10:15 a.m. June 12 on the first floor of the Mecklenburg County Superior Courthouse.
Clerk of Superior Court Martha Curran signed an order Monday clearing the way for the lender to foreclose on the 409-unit building at Fifth and Pine streets.
The entire building and its contents will be sold at once, excluding the condos and parking spaces that have already been sold to individual buyers. Buyers have closed on less than two dozen units on the luxury highrise.
Neither the borrower nor a representative of the Vue attended the roughly 20-minute hearing.
The Vue's developer, MCL Cos. of Chicago, defaulted on its loan, and the current owner of the debt, New York-based Northwood Investments, accelerated the loan and started foreclosure proceedings in April, according to court filings.
The current debt holder, identified in court papers as NWSF LLC, lists its address as Northwood Investments in New York.
Northwood Investments paid around $100 million for the project's $195 million construction loan, it has been reported.
The tower has struggled since it was finished in 2010. When sales started in the mid-2000s, the building was touted as one of uptown's most luxurious residences, offering the highest-quality amenities, an Olympic-sized swimming pool and tennis courts.
The Vue's condos started selling from just under $200,000 to more than $2 million. Buyers paid 10 percent of the contracted sales price as a deposit. Developer Dan McLean has said that more than half the building was pre-sold but agents struggled to close sales. Some buyers couldn’t get financing because appraisals came in under contracted sales prices. Others simply wanted out of their contracts.
Some people have successfully sued the Vue to return their deposits but are now less likely to get their money back, attorneys say.
Real estate professionals say the building could be ripe for a conversion to apartments. Other uptown condo projects have been changed into rentals after the real estate market fizzled.
As the Charlotte housing market has struggled, more people have turned to renting versus buying a home, fueling interest in the apartment market.

12 comments:

Anonymous said...

And the nerve they tried to sue potential home buyers...Karma

Gasshizzy said...

Not to worry, Mr. McLean will just open another LLC tomorrow, bilk another few hundred people out of their money, and will it will all start over.

Make these developers responsible for their debt. Claim bankruptcy? No new businesses until you pay your last leners back. No exceptions.

Anonymous said...

That's a great idea, @gasshizzy! I've seen too many developers screw over investors, lenders and end buyers with bad projects, only to file bankruptcy and do it all again. If you can't discharge student loan debt in bankruptcy, you shouldn't be able to discharge debt from speculative projects, either. There is no incentive to break the cycle if they can walk away from any responsibility if the deal goes sour.

Anonymous said...

@gasshizzy & Anon 5:08...

I think the thing you are missing here is that lenders were willing to loan them the money in the first place. This risk of the project going south and the LLC filing for bankruptcy was known and quantified - the lenders knew this was possible and now they can take the hit.

Student loans are a bad example because student loan debt is highly subsidized and regulated. If the lenders didn't want the risk of this project, they had every right to walk away.

Anonymous said...

Yep - the lenders were thinking they would cash in on this too. I know the developers were not so nice to the buyers but when this project started everybody thought it was great. The buyers also thought they could buy in cheap and then sale in a couple years for a nice profit. Greed all the way around. The developers did build a great building - and that is really what their job is anyway...

Anonymous said...

My first and final bid will be $20K.

They can take it or leave it.

Anonymous said...

^^^^
20M you mean? Still wouldn't be enough.

Anonymous said...

Pack the DNC in there and get the 99mil back in one week.. Problem solved.

Anonymous said...

DNC...great solution!!

Anonymous said...

You people have all the answers.

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