Michael Comras files suit alleging NJ real estate firm used predatory lending tactics
Suit surrounds loan for retail property at 2982 Grand Avenue in Coconut Grove
Commercial real estate developer Michael Comras is in a dog of a legal fight with a New Jersey-based real estate financing company that bought a loan on one of his Coconut Grove retail properties.
Comras’ S&C Venture sued Coconut Grove Acquisition LLC in Miami-Dade Circuit Court last month for malicious prosecution and breach of contract for attempting to foreclose on the property, a three-story 36,230-square-foot retail building at 2982 Grand Avenue. Coconut Grove Acquisition is an affiliate of Case Real Estate Capital, a firm based in Rochelle Park, New Jersey, that provides loans to commercial property owners and developers in New York City, South Florida, the Northeast and Mid-Atlantic region.
Comras‘ attorney Todd Legon said Case’s actions against his client tanked a potential sale of the property and has placed a refinancing deal in jeopardy. “[Comras] would prefer not to have to bring lawsuits like this one,” Legon said. “Unfortunately, lenders from other states come down here and don’t learn the rules of the road.”
Comras’ lawsuit was filed six months after Miami-Dade Circuit Court Judge Samantha Ruiz Cohen sided with his firm and dismissed Case’s foreclosure complaint. “That final judgment is currently being appealed,” said Chris Mavros, Case’s managing director, principal and chief financial officer. “We believe the new suit against us lacks any merit and we will vigorously defend against it.”
The dispute centers on a promissory note for $7.9 million S&C Venture obtained from Mercantil Commercebank in 2007 with a maturity date of 2012. However, S&C had an option to extend the maturity date until August 2017. In 2011, Mercantil sold the loan to Stabilis Capital, a company described as a predatory lender in the S&C lawsuit.
S&C alleges that Stabilis has a pattern of acquiring secured loans that are current and then creates confusion with the borrower as to where future payments should be sent. For instance, Stabilis executives never informed anyone from Comras’s company about where to send the mortgage payments, even though the borrower was depositing sufficient funds into an operating account from which the previous lender, Mercantil, would withdraw the monthly loan payments, S&C says in the suit.
Furthermore, S&C didn’t receive its payment instructions until early January 2012. By then, Stabilis had sent S&C a notice of default for missing mortgage payments in November and December 2011. Even though S&C continued to make payments on time, Stabilis initiated a foreclosure action in June 2012 by claiming the Comras affiliate had committed non-monetary defaults, the lawsuit alleges. Case’s Coconut Grove Acquisitions bought the loan from Stabilis in 2014 and continued the foreclosure against S&C.
Despite the foreclosure lawsuit being dismissed, Case is still playing hardball by claiming the loan payoff amount is $15 million, which includes nearly $10 million in default interest that Judge Cohen already ruled the New Jersey company is not entitled to, S&C alleges.
According to property records, Comras, who is also an investor and broker, bought the property at 2982 Grand Avenue in Coconut Grove in 1993 for $857,500. Current tenants include a 24-Fitness gym and a FedEx Office Center.