CHARLOTTE, N.C.-- Lenders have started foreclosure proceedings on Ballantyne Village in south Charlotte and intend to sell the upscale mixed-use center at public auction in two months.
The project's owner, meanwhile, said he's confident he'll find new financing before the property is sold. It is set to be auctioned off at the Mecklenburg County Courthouse on July 29, according to court documents.
Bob Bruner, principal with BV Retail, which owns the property, said that the lender's actions were a normal part of the foreclosure process and that he wasn't worried. He said the battered economy and credit crunch have made refinancing difficult, but that the center had "substantial" cash flow.
"Like many other properties in Charlotte, Ballantyne Village's mortgage has come due at a time during this cycle in our economy when the refinancing market is very weak," Bruner said in a statement. "Ballantyne Village has a refinancing plan in place, and management is very confident that a new loan will be in place in the near future."
Shoppers and store owners won't see any changes in the meantime, he said.
Bruner, who didn't provide details about his refinancing plan, also said the retail center has seen an increase in interest from potential tenants recently.
Home to the Ballantyne Village Theatre and Ballantyne YMCA, the center lost tenants during the recession. Two years ago, for example, the 6,500-square-foot high-end Table Restaurant & Bar closed after two years of operation.
Bruner said the village's daily operations won't be affected by the refinancing and that events such as Wednesday's Mix@Six music program will continue.
An increasing number of commercial properties nationwide are falling behind on mortgage payments, according to Trepp LLC, a New York company that provides commercial real estate data and analysis.
Maturing loans, rising vacancies and falling rents are making it difficult for commercial property owners to stay afloat.
In the Charlotte area, more than $319 million of securitized mortgages on commercial properties were delinquent at the end of the first quarter - representing 6.2 percent of loan balances and up from a 1.5 percent delinquency rate last year, according to Trepp.
BV Retail in July 2006 took out a $50 million loan with an original maturity date of August 2008 and three, 12-month extensions from Bank of America. The loan, now held by other financial groups, was extended for the second time last year. The lenders gave BV Retail a default letter Jan. 26.
In court documents, the lenders said BV Retail, which owes $31.5million on the loan, was in default because it has failed to make payments in a timely manner.
Opened in 2006, Ballantyne Village includes 140,000 square feet of high-end boutique retail and 25,000 square feet of office space. It sits across from Ballantyne Corporate Park, a separate development of office, housing and hotel properties owned and operated by The Bissell Cos. The Bissell Cos. recently broke ground on a new, 150,000-square-foot speculative office building and reported that 2009 was a strong year in terms of leasing.
Luxe living for sale uptown
Developers behind a newly completed boutique condo project uptown debuted their units with a party and NASCAR celebrity Thursday evening.
The Madison, with 26 units, opened its doors for an invite-only soiree offering wine, champagne, light snacks and petit fours.
Formerly known as The Tower and as the Smith Curry Condos, the project remade one of uptown's biggest curiosities - two elevator shafts to nowhere.
The shafts were to connect to an extended-stay hotel capped by a ballroom, but a downturn in the hotel industry derailed that project in 2001.
Construction on the condos, which sit above a parking deck between the Hampton Inn and Hilton Garden Inn, started in 2006. They were tentatively priced from $750,000 to $1.5 million and expected to be finished in 2007.
As construction dragged on, developers, including Gastonia businessman C.W. Smith and Lee Curry, didn't release updates. Smith died last year and Curry has since retired and left the project.
The developer, Smith Enterprises, which also owns the flanking hotels, waited until the condos were built to sell them. Hopeful condo buyers have been burned when they paid deposits for units in other projects that later failed.
Patrick Deely with The McDevitt Agency said prices for the one- and two-bedroom units, ranging from 1,700 to 3,500 square feet, will be determined this summer. The units will open around the same time as a competitor, the 409-unit Vue, a new condo tower where units are priced from $279,900 to $999,900.
A primary selling point for The Madison, Deely said, will be the intimacy of the 26-unit building. Each unit has its own, distinct finishes - some are more traditional in style, while others are contemporary. Owners will also be able to pay for services offered by the adjacent hotels, such as maid or car service.
One corner penthouse at The Madison offers a view of the newly opened NASCAR Hall of Fame and Interstate 277. The master bathroom and giant walk-in closet together add up to roughly 600 to 700 square feet. The 3,500-square-foot condo also has a butler's pantry with a separate entrance.
Deely said he's optimistic the project will sell out in about a year, despite a buyers' market.
"It's a unique opportunity," he said of the project. "I'm not afraid of this market. Finding 26 buyers in a sea of 1.8 million people is pretty easy."
