Banco Popular has filed a lawsuit to foreclose on the WA Condominiums in Harlem, after the developers allegedly defaulted on $13.2 million in loans.
According to the suit filed last Thursday, the developers, brothers
Trevor Whittingham and David Atkinson, borrowed $11.1 million in 2006
to build the 35-unit boutique condo, one of the high-end developments
in Harlem built during the boom, at 2201 Adam Clayton Powell Boulevard
at 130th Street.
The developers also took out a $2 million project loan and a $2.6
million acquisition loan from MTM Realty, the latter which was later
assigned to Puerto Rico-based Banco Popular.
In October 2009, Galaxy General Contracting, based in the Bronx, filed
suit in State Supreme Court alleging it was terminated as a contractor
from the project and was met with armed guards when it tried to
retrieve its equipment from the property. By February, Galaxy General
filed suit to foreclose on $2.75 million in unpaid mechanic’s liens.
The foreclosure suit alleges the developers failed to get a temporary
certificate of occupancy by Nov. 30, 2009, which is the date when the
loan matured. The suit alleges the developers also failed to properly
secure the property, leading the bank to ask for a court-appointed
receiver to oversee the premises.
“Unless Banco Popular is authorized by this court to employ watchmen to
protect the mortgaged property, [and] the receiver is immediately
appointed By The Court, Banco Popular will suffer irreparable harm by
the devaluation, destruction and deterioration of the mortgaged
property,” lawyers for Banco Popular said in the complaint.
The developers declined to comment on the case in any detail.
“Call Banco Popular,” Atkinson said. “I didn’t file the lis pendens, they did.”
Banco Popular declined to comment, citing the pending litigation.
As The Real Deal previously reported, WA Condominiums had amenities rarely seen in Harlem,
including an indoor atrium, air conditioned garage, 24-hour concierge,
fitness center and swimming pool. The developers hoped to attract a
combination of foreign investors and New Yorkers looking for a high-end
unit in what was one of the city’s hottest emerging markets.
To that end, the developers hired architect Marc Spector of the Spector
Group, whose clients include the Securities and Exchange Commission,
Merrill Lynch and Stephen Weiss Studio.
Critics claimed that asking prices were well above the market, with
prices topping out at $1,657 a square foot for a three-bedroom unit.
According to Streeteasy.com, the listings have been taken off the
market at the property. No information was available about the number
Broker Robin Prescod, managing partner of Harlem Homes Realty, told The Real Deal that
many condo projects were priced with the expectation that foreign money
would fuel the boom, however most of those projections were dashed by
the credit crisis.
“I think a lot of them were looking to the European market [to come in]
and keep it as pieds-a-terre,” Prescod said. “Then they would hope for
the residents of New York to want to move uptown.”