A lender foreclosed today on two apartment buildings in Tustin where SunCal Cos. planned to build townhomes. That brings to four the number of properties the Irvine-based land developer has lost to foreclosure in the past eight days. SunCal also lost a Santa Ana complex to foreclosure on Monday and a 1,300-acre tract near Reno, Nev., on Feb. 27.In addition to the foreclosures, numerous liens, lawsuits and complaints have been filed alleging that the company owes at least $5.8 million in unpaid debts is behind schedule on two development projects. (To read more, CLICK HERE!)
The minimum bids required to buy the properties up for auction today totaled $22.5 million for both parcels. There were no bidders, allowing the lender, D.B. Zwirn Special Opportunities Fund, to repossess the properties. One was the Rancho Sierra Vista apartments at 1972 Mitchell Ave., the other was an apartment complex at 14421 Red Hill Ave.
Residents of the Mitchell Avenue property expressed relief that the apartments had been spared from the bulldozer.
“If they could have a management company that would maintain it as it is, that would be wonderful,” said Peggy DeBeau, 78, a 21-year resident of the Rancho Sierra Vista apartments. “We would very much like to stay here.”
David Levy, whose mother has lived in the complex since 1978, said demolition is “off the table,” and has been since the housing market soured, making the townhomes unfeasible.
“It’s (now) owned by a Wall Street hedge fund that hopefully will contract with a reputable property management company,” Levy said.
Meanwhile, in Barstow, further problems surfaced. That’s where SunCal is developing a 25,000-home project that would triple the size of that town. According to the Desert Dispatch, the Register’s sister paper in Barstow, work has slowed on the Waterman Junction development, and SunCal has fallen $59,000 behind in payments to a city account used pay expenses related to the project.
A spokesman said that the company intends to fully complete its plans over the 30-year span of the project, the Desert Dispatch reported. He said also that the company will review the unpaid bills with the city shortly. (To read more, CLICK HERE! )
Maybe there problem was that they were building 25,000 homes in BARSTOW!!!!!!!!
Who in their right mind would do that
Wow, it just goes from bad to worse for SunCal.
What is the most fascinating is how quickly this market has soured, and how quickly some of these major home builders are going under. In the case of SunCal, this all crashed down on them in the last 120 days. SunCal likely won’t be around at all by summer.
I love to hear their spin on how they will rebound! This is a prime example of a company overextending themselves and trying to expand into homebuilding during the worst housing crisis to hit our country. I feel sorry for the vendors, lenders and partners that will never see full payment in what is owed. If they had any decent management they would put off the many grandiose projects that they have gotten themselves into months ago. Personally, I will lose no sleep over their demise.
The funny thing is that DB Zwirn is actually in more trouble than Sun Cal. You have one insolvent entitiy giving up assets to another insolven entity….GRRRRREEEEEAAAAAAAATTTTTTTTT
My God, this slowdown has been happening for TWO YEARS now, and people are shocked and surprised at the suddenness?