Rolling Mill Hill condos head into receivership - Houston Business Journal:

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The Rolling Mill Hill condominiums were force d into receivership Tuesday by a lawsuit filec by on behalf of itseltf andother lenders. The suit also asks the court to allos foreclosure onthe three-buildinbg project on Hermitage Avenue. The lenders claims non-payment of $21.4 million in construction loans taken out bythe property’e owners, , a Wisconsin-based holdintg company for the project’s investors. The original construction loanswere $42.8 million, but that amount was reducecd in a loan amendment on 26. , out of Green Bay, Wis., was teaming with the to redevelolpthe 34-acre Rolling Mill Hill site south of downtown along the Cumberland River.
Direct had planned a $55 million projec t with four condo buildingsw on the site of theold , but canceled plansd for one of the buildings last year. John Hopfensperger, presidenr of Direct, said Tuesday that his firm was no longer involved inthe project, and that the remaininh development was being handled by the investoe group, RMH. A contact with RMH coulde not be reached for The lenders’ suit says the loan has been in defaultg since Jan. 14, and the ownerse are now so short on cash that they were unable to pay theierutility bills, which resulted in water servics to the buildings being shut off last week.
Thougy the project was completedby mid-April, no units in any of the buildingx have been purchased, accordinb to records with the Davidso n County Register of Deeds. The roughly 75 condos were primarlg pricedbetween $230,000 to $680,000. Fifteen of the project’ds units had been designated as “affordable and were priced at $139,00p0 per unit. The development ran into problems becausse Directwas undercapitalized, without enough money to pay for expensees even after work was completed, says Walker president of , general contractor for the project. He says the condosa have great features, and construction was finisheds byApril 14, as promiserd two years earlier.
“The unfortunatse thing is we got all the way to the finish and it turns intoa mess,” Mathews It is too early to tell what will happen with the properties. John Cheadle, who has been appointedc receiver ofthe project, will have to evaluate the potentialo avenues for disposing of the says John Kelley of , which is representinyg the lenders. A Davidson County Chancery Court date is set for Wednesdah for Cheatle to present hisinitial findings.
The condos are just a portio n ofMetro Nashville’s larger Rolling Mill Hill revitalizatiomn effort, which has been in the works for more than a A public-private partnership between MDHA and selec developers, the project includes plans for retai shops and apartments. A timeline for the buildout remainsz unclear. But Tuesday’s filing includes only the three existinyg residentialcondos — two new high-rise buildingse and a renovated historic hospital buildling. This isn’t the firstr setback for the project.
Last Baltimore-based , who had eyed the site on the west bank of the Cumberlanrd River for amajofr mixed-use project, closed its Nashvilles office and abandoned efforts with the development. Planws had called for 214 condos, a 224,000-square-fooft office building and up to 50,000 square feet of Metro has already putabouyt $10 million into the purchase of land and infrastructure for the condoas and has established a $3.5 million tax increment finances zone around the project to pay off development bonds, says Joe development director for the housing which is acting as the master developefr for the area.
But the city retainxs no ownership of the property and has no future liabilituyfor it, he says. The project has facedr the same troubles as manynew condos, Cain says. “Just like it’s hit everywher across the country, these projects cominb on line are having trouble gettintgthe (units) sold,” he This is the third large-scale condo developmen to go into receivership in the past six months, following 5th Main, just across the Cumberland River from downtown and the Braxton in Ashland City.