A private equity fund has taken title to 175 unsold condominiums at Related Group-developed Trump Hollywood in an online foreclosure auction.
BH III, a Hollywood-based entity, won the Broward Circuit Court auction with a $100 bid on Thursday.
BH, which is managed by GMC Mortgage Capital director Gregory Freedman, Daniel Lebensohn and Charles Phelan, paid $160 million to acquire the distressed notes secured by the condos in November 2010. Miami-based Related had owed HSBC Realty Credit about $226 million on the oceanfront project’s senior mortgage and about $23 million in mezzanine debt.
In January, BH and Related agreed to a $173.29 million foreclosure judgment, which paved the way for the auction. Related agreed to help the new owners manage the 2711 S. Ocean Drive property and market the unsold condos.
In an apparent move to discourage potential bidders, BH used the “plaintiff max bid” feature in Broward Circuit Court’s auction site to submit a maximum bid of the judgment amount before the auction.
The Trump Hollywood deal is BH III’s third South Florida acquisition. Last year, the company acquired the debt on the 117-unit Terra Beachside condominium at 6000 Collins Ave. in Miami Beach. In September 2010, the investment group took title to the project and is now marketing the condos.
In August 2009, the group paid $8.3 million for 25 condos at the Fontainebleau III Sorrento within the Fontainebleau Hotel resort in Miami Beach.
Related, one of the most successful developers during South Florida’s condo boom, lost a number of high-profile condo projects to lenders in the collapse of the housing market, including two mostly unsold towers in Miami’s three-building Icon Brickell complex and the 420-unit CityPlace South Tower in West Palm Beach.
With the Trump Hollywood deal, Related rid itself of all distressed debt, company executive vice president and chief operating officer Matt Allen told the Review in November 2010.
Source: Daily Business Review