Monad Terrace restructuring its financing amid foreclosure suit
Sales for the 59-unit condo project launched in February
Monad Terrace is restructuring its financing as its lender pursues a foreclosure lawsuit against the developer, sources told The Real Deal.
JDS Development Group, Vector Group investment group New Valley, Ackerman Development, Mink Development and others plan to build Monad Terrace, a boutique luxury project in South Beach. The project officially kicked off sales in February in the midst of a luxury condo slowdown.
Late last month, Delaware-based lender EO Monad Terrace filed the suit against Monad Terrace Property Owner LLC, in addition to McNamara Salvia Inc. and Americaribe Moriarty Joint Venture for failing to pay the $45.8 million mortgage principal on the property. The suit did not name individuals.
The LLC, led by JDS CEO Michael Stern, assembled the development site from 13 sellers, and spent more than $51 million on the 14 parcels between 2015 and 2016. The final owner sold the holdout 3,500-square-foot parcel for $9.25 million, or $2,643 per square foot last year.
EO Monad provided the loan in June 2015 and extended the maturity date to May 17 of this year.
Stern told TRD last week that Monad Terrace was restructuring its financing and plans to break ground in the next quarter. He declined to provide the loan amount or lender name, but said he was working with a big bank. Stern also declined to comment on the foreclosure suit, but a spokesperson for the developer confirmed that Monad Terrace expects to close soon on recently obtained new financing.
“During the course of negotiations with the current lender to facilitate that closing, the lender filed this lawsuit which is entirely without merit. Monad Terrace will respond in due course,” the spokesperson said.
The lawsuit also breaks down the ownership structure of Monad Terrace Property Owner at the time of the loan closing, which reveals Vector’s New Valley owns 30.38 percent of the company. The majority 69.62 percent is owned by entities controlled by Stern, Daniel Minkowitz of Mink, and Ackerman; and Zurab Zaskalko, Paata Gamgoneishvili and Evgeny Konovalov.
JDS launched sales for the 59-unit building, which will be designed by Pritzker Prize winning architect Jean Nouvel, earlier this year. Prices started at $2 million and units range from two to five bedrooms. It would mark the first building for Nouvel in Miami, who’s also designing the individual units. Kobi Karp is working with Nouvel on the design.
The South Florida Business Journal first reported the foreclosure suit.