The owner of a mortgage loan secured by a Miami Beach hotel development site filed a foreclosure lawsuit against the developer that owns the site.
The defendant in the foreclosure lawsuit, a limited liability company managed by Gianfranco Rondón of RG Group, listed the development site for sale with an asking price of $10.95 million in August.
Rondón, a Venezuelan businessman, manages RG Michigan 2014 LLC, which paid $4.25 million in 2014 for the 14,000-square-foot hotel development site in South Beach at 944 Fifth Street and 419 Michigan Avenue.
Italbank originated a $3.5 million mortgage secured by the development site in 2015 and assigned the loan to a limited liability company, LCP NPL 3 2018 LLC, in April of this year.
The limited liability company holding the loan filed a foreclosure lawsuit against Rondón’s company after construction of a five-story, 27,000-square-foot hotel on the South Beach site stalled. The foreclosure lawsuit noted that nine contractors have filed construction liens claiming that the developer failed to pay them for work on the hotel project, designed by architect Kobi Karp.
In 2016, Rondón’s company paid $3.6 million for the 7,000-square-foot property at 411 Michigan Avenue, which the company planned to convert to parking space for the hotel.
But that property is scheduled to be sold Dec. 3 in a foreclosure auction. In July, City First Mortgage Corp. won a $2.39 million foreclosure judgment against Rondón’s company because the mortgage lender holds a defaulted loan secured by the property at 411 Michigan Avenue. [South Florida Business Journal] – Mike Seemuth