Many of you have been waiting to find out what is going on with the Ritz-Carlton Residences Buckhead for quite some time. There has been a lot going on behind the scenes to make this project a success and we are finally seeing some activity and life. It’s been slow going, but sometimes it’s not so important how fast you get to the finish line.
The good news is Post paid off the residential portion of the 3630 Peachtree tower and now own that portion outright. There are only a handful of condo buildings in town that are able to say that, including 10 Terminus Place, Sovereign and now the Ritz-Carlton Residences Buckhead. Many buyers are hesitant to be one of the first to purchase in a new building, but really there are a lot of opportunities in doing so. We can get into that another time. Keep reading to see how Post paid off the condo portion of the tower.
How did Post achieve this? Take a look at what citybizlist.com wrote on their website.
Post Apartment Homes LP and Novare Group Holdings Inc. have restructured the ownership of the 129-unit Ritz-Carlton Residences project to facilitate a sale.
The JV Partners, with a pro-rata 49 percent interest in the 34-story mixed-use tower, have been in talks all summer with Bank of America and Regions Bank over $187.1 million in three loans that will start to mature in 2011. In essence, the project’s residential portion was transferred to a single-purpose entity to segregate it from the class A office and retail components held by two other developers and the extra developable land at 3630 Peachtree.
With the transfer and full redemption of the condominium interests in the Mixed-Use LP, the secured construction loan for $187.1 million was split into three facilities: $101.1 million for the office and retail owner, Mixed-Use LP; $77.8 million for the condominium owner, which still has a $69.3 million outstanding balance; and $8.3 million for the land partnership, which has an $8.2 million outstanding balance.
As part of the complex restructuring, a wholly owned subsidiary of Post Services Inc. signed a loan sale and assignment agreement with Bank of America and Regions Bank to acquire the lenders’ interest in the loan facilities in the limited liability condominium company for $49.8 million. The action eliminates Post’s principal payment and debt-service guarantees as well as the minimum release prices that had been in effect for condominium sales. The SEC filing also detailed a change in the licensing and branding arrangement with the third-party licensor.
Post has classified the project as “held for sale” for the quarter ending Sept. 30. The Atlanta-based company also may record an additional impairment ranging from $5 million to $7 million in connection with its acquisition of the asset. “However, Post also expects to recognize gain in excess of the impairment loss related to the acquisition of the residential loans,” the developer concluded in the filing.
Tomorrow I’ll have some more news about the project, so check back!