Remy Jacobson allegedly in default on Design District loan: lawsuit

The suit alleges the building’s owners failed to provide more equity to fund construction costs

Miami /
Jun.June 04, 2020 04:30 PM
Remy Jacobson, Jean-Marc Jacobson, 4141 North Miami Avenue (Credit: Google Maps and REALTOKEN)

Remy Jacobson, Jean-Marc Jacobson, 4141 North Miami Avenue (Credit: Google Maps and REALTOKEN)

Cryptocurrency enthusiasts Remy Jacobson and his brother Jean-Marc Jacobson turned to an Arkansas community bank last year to finance the redevelopment of a historic building in the Miami Design District.

But now, the Jacobsons are facing a lawsuit from Conway, Arkansas-based Centennial Bank, alleging that Remy Jacobson, Vanessa Jacobson and Jean-Marc Jacobson are in default on $8.4 million in loan payments on the three-story commercial building at 4141 North Miami Avenue. The suit alleges that the Jacobsons failed to meet the bank’s request to provide more equity to pay for construction costs.

The Jacobsons are in the process of filing a countersuit, and their lawyer, Joe Herndandez of Weiss Serota, said the loan was never in default and the development group never missed a payment.

“In my 25-year career, I have represented banks my whole career. Of all the workouts I have ever seen, this is one of the ones that would have been one of the easiest to work out,” Hernandez said. “We are frankly surprised and disappointed. We are scratching our heads on this.”

Centennial Bank and the bank’s attorney Thomas P. Angelo of Angelo Law declined to comment on the litigation.

The bank has expanded its South Florida presence since acquiring Pompano Beach-based Stonegate Bank in 2017.

Centennial Bank has become one of the area’s most active construction lenders, including lending to billionaire Moishe Mana’s Asia Americas trade hub in Miami that has yet to get off the ground. Banking experts say that a heavy concentration in out-of-state construction loans is a risky strategy, and regulators have warned banks to limit their exposure to construction lending.

According to the lawsuit, on May 22, 2019, Centennial Bank took over an existing loan from City National Bank and increased the loan amount to $11.92 million.

Based on a review, Centennial Bank said it found that the Jacobsons had insufficient funds to pay the remaining portion of construction costs to complete the project, the suit states.

As a result, on Feb. 26 Centennial Bank requested that the Jacobsons cough up more $1.8 million in equity within 10 business days, according to the lawsuit. The development group failed to provide Centennial with the $1.8 million, and the loan went into default, according to the suit.

The lawsuit also alleges the Jacobsons were required to keep a minimum monthly balance of $2 million in their account with Centennial Bank at all times, but they failed to do so.

On May 6, the loan was placed in default. Centennial Bank claims it is owed $8.4 million along with interest from April 22 to May 6 and attorney fees and late fees.

The Jacobsons’ 4141 Design LLC paid $10.5 million for the 15,900-square-foot commercial building in 2016 and received historic designation from the city of Miami shortly after that. The group planned to renovate the building and bring in new tenants, including a Blockchain company. The building was built in 1961 on a 9,700-square-foot lot.

Remy Jacobson and Marc-Jean Jacobson launched a crowdfunding platform in May 2019 called RealT that allows cryptocurrency investors to invest in real estate assets, starting with rental homes in Detroit, Michigan.


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