Chetrit Group’s waterfront condo development site in Pompano Beach and its units at the Hollywood Beach Resort condo are headed to a Uniform Commercial Code foreclosure auction.
The lender that provided a $17.2 million loan on both properties in 2022 filed for the UCC foreclosure, according to a public notice published in the South Florida Sun Sentinel and FloridaPublicNotices.com. The auction will be held on Dec. 22, seeking to generate $21.7 million to cover the debt’s principal, interest, default interest and reasonable fees and costs.
UCC auctions are non-judicial processes in which the ownership interest in the entities that own properties is sold, meaning the winning bidder assumes ownership of the limited liability company holding the real estate. Generally, mezzanine lenders file for UCC foreclosures, which proceed faster than traditional foreclosures that can drag through the courts.
Chetrit’s properties are the 2.5-acre vacant Pompano Beach site at 2507 and 2629 North Ocean Boulevard and 102 condo units at the Hollywood Beach Resort at 101 North Ocean Drive, according to property records. The firm has long planned a 121-unit condo project on the Pompano Beach site with a 20-slip marina. Construction hasn’t started, records show.
Joseph Chetrit declined to comment.
Borrowers can work out forbearance agreements with lenders by extending loan maturities or securing equity partners, often to postpone auctions to give them more time to come up with capital.
Both sites are encumbered with debt from New York-based Madison Realty Capital, led by Josh Zegen, Brian Shatz and Adam Tantleff. In 2022, Madison provided Chetrit with a $94 million loan on the Pompano Beach property and a $78 million loan to purchase the Hollywood Beach Resort units.
Last year, Chetrit avoided a UCC foreclosure attempt by Madison on the loans by chipping in a significant amount of capital to refinance the debt, extending the Pompano Beach financing by six months and the Hollywood Beach Resort financing by a year, a source told The Real Deal at the time.
Madison declined to comment.
Madison has been a frequent lender to Chetrit. In 2021, it provided a $310 million construction loan for Chetrit’s planned 4 million-square-foot project on the Miami River that at full buildout would include 1,900 apartments and condos; 39,000 square feet of retail, office space; a 17-slip marina and 770 parking spaces.
The first phase, consisting of a 54-story, 632-unit luxury apartment tower on the site at 275 Southwest Sixth Street in Miami, is nearly completed.
This year, Adam Neumann’s Flow, Canada Global and billionaire Yakir Gabay’s Yellowstone Trust bought a partnership stake in the Miami River project. Chetrit kept a “significant minority” stake.