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Miami broker sues for allegedly unpaid commissions tied to financing for a hotel and gym
After working to obtain loans for a Cancun hotel and an NFL player’s mega-gym, broker Harvey Burton is seeking $8.9M in unpaid commissions
A Miami-based broker who assists developers in obtaining financing is accusing a Phoenix-based construction firm and former NFL player Donald “Dre” Bly of stiffing him for a combined $8.91 million in commission fees, according to a pair of lawsuits filed in Miami-Dade Circuit Court.
Harvey Burton sued Palacio Development Group and its executives, president Young Troung and vice presidents Craig Ball and Gilbert Hernandez on Aug. 6 for breach of contract and unjust enrichment, among other counts. The same day, Burton filed another lawsuit against Bly and his company, Dre Bly Sports Complex LLC, alleging the same counts.
Burton’s lawyer Douglas Eaton declined comment. Troung, Ball and Hernandez did not respond to messages sent to Palacio’s general email address. There are no publicly listed phone numbers for the company. And Bly could not be reached for comment.
The Palacio lawsuit alleges Burton’s company Investment Funding Associates was retained last year to secure a $100 million loan commitment for a Holiday Inn hotel and casino in Cancun that the Arizona company is developing. In exchange, Burton would get an 8 percent commission, or $8 million.
On Aug. 16. and Aug. 30 of 2017, Burton was able to secure letters of interest from Avison Young and CMN Funding, respectively, the lawsuit alleges. Both times, Palacio failed to cooperate with obligations to provide information and documents to Avison and CMN, which is a breach of contract, Burton alleges. He claims he is entitled to his commission fee because Investment Funding Associates fulfilled its duties.
In the Bly lawsuit, Burton claims that his firm and Dre Bly Sports Complex entered into an agreement on Jan. 8, 2017 to find lenders who would provide a $13 million loan for a sports and fitness facility in Virginia Beach to be developed by the former defensive back for the St. Louis Rams and three other NFL teams. Investment Funding would get a 7 percent commission or $910,000.
Burton alleges Investment Funding got a $12.86 million loan offer in February 2017 from Elevated Equities that Bly accepted, but he then failed to pay a $2,500 due diligence fee and didn’t cooperate with obligations to provide the lender with documentation. Subsequently, Investment Funding also obtained letters of interest from two other potential lenders, the complaint states.
One offer fell through because Bly allegedly refused to pay for an appraisal and failed to complete a loan application with the other lender, Burton claims.