by Brian Bandell
Jun 10, 2011, 4:57pm EDT
The Omni Center and Hilton Miami Downtown property has been hit with a $204 million foreclosure lawsuit that could usher the massive property into the hands of the Related Group of Florida and its fellow investors.
The foreclosure could ultimately pave the way for redevelopment amid a flurry of development activity in the area, including a $236 million purchase by Malaysia's Genting Group.
The property at 1501 Biscayne Blvd. has 1.5 million square feet of office, retail and hotel space and a 2,700-space parking garage on 14 acres. The hotel has 527 rooms.
The property, which is north of downtown Miami and close to Biscayne Bay, has received $66 million in capital improvements since 2008 and its former function as a mall has been mainly been transformed into offices and educational space.
Tenants include the Greater Miami Chamber of Commerce and the Miami International University of Art & Design.
The Business Journal reported in May that a joint venture between Miami-based Related Group, Tate Capital Real Estate Solutions and ROK Acquisitions bought the Note A on the Omni center loan for about $100 million. This represents a reversal of rolls for Related Group, which has lost a handful of its condo projects to lenders in recent years.
Related, led by Chairman and CEO Jorge Perez, has long been the region's largest condo developer and his been positioning itself for a rebound after giving some projects back during the recession. The Business Journal reported Thursday that The Related Group on had launched a new partnership with residential brokerage International Sales Group.
Capmark Financial, representing the mortgage holders, filed the foreclosure lawsuit on June 1 against Downtown Miami Mall and Downtown Miami Hotel – the owners of the Omni. The borrowers are affiliated with New York-based Argent Ventures. Officials there couldn’t immediately be reached for comment.
Miami attorney David Haber, who represents Capmark and the lenders in the lawsuit, said the mortgage has about $204 million outstanding – $159 million under Note A and $45 million under Note B. He said the lender filed motions for inspections of the property and a motion to show cause why a final judgment shouldn’t be awarded.