Everglades on the Bay bankruptcy nears resolution
May 14th, 2010
(South Florida Business Journal, May 14, 2010)
One of the most-watched bankruptcies in South Florida – that of the Everglades on the Bay condominium – is close to being resolved, attorneys on Friday told the judge handling the case.
“We are very close to having terms that we can recommend to the bank group,” Ana Alfonso, attorney for Bank of America, for the lending group on the $300 million project, told U.S. Bankruptcy Judge Laurel Isicoff.
The 49-story, twin-tower condo is one of the biggest real estate bankruptcies in Miami. It was filed against developer Cabi Downtown in August after BofA refused to allow write-downs of sales prices. The same day, the bank filed a foreclosure action on a construction loan of $209 million – one of the first hostile foreclosure actions on a condo tower in Miami in recent history.
Since then, BofA has attempted to dismiss the bankruptcy.
But Cabi attorney Mindy Mora echoed Alfonso’s optimism about an agreement.
“We’re requesting the hearing be continued because we believe we are on the verge of finalizing our disclosure statement with BofA, and the [creditors]) committee, as well,” said Mora, of Bilzin Sumberg Baena Price & Axelrod in Miami.
Another hearing is set for May 28 on the disclosure statement, which lays out a plan for Cabi to continue running the building, selling and leasing units, and paying off the loan.
The only objection came from Gary Blum, an attorney for W.G. Yates & Sons Construction Co., one of the larger unsecured creditors. He asked unsuccessfully for the judge to allow other parties to bid on taking over the project.
Blum said allowing Cabi to run the project longer, without a final agreement from the lenders, only puts Cabi deeper in the hole financially, which could potentially minimize Yates’ eventual recovery.
But Isicoff said she wouldn’t allow the bankruptcy to continue much longer.
“I’m am not inclined to go further,” the judge warned …. “Either you lock yourselves in a room and chew on each other until there’s a deal, or we pull the trigger.”
The judge made it clear she was still willing to consider motions to concert the project to a liquidation or dismissal, “in which case there will be only one winner.”
“That would be the banks,” Mora replied. “Although they may not like what they win.”
“Yes, be careful what you wish for, Ms. Alfonso,” the judge warned.
Robert Cooper, an Aventura-based attorney for buyers who are trying to recover deposit money on the project, said he and the developer were nearing an agreement to refund any deposit money over 15 percent of the original unit purchase price.
Cooper told the judge that about half of his clients are of Haitian descent and need the money partly because of the recent earthquake in Port-au-Prince and the effect it has had on their families, among other financial reasons.







