FDIC Auction of Repossessed Property for Sale in Florida

Condominium projects that once belonged to the defunct Corus Bank of Chicago are some of the repossessed property for sale at the Federal Deposit Insurance Corp. (FDIC)-managed auction.

The result of the recent FDIC auction is good news for the condominium market, especially in the Tampa Bay area where a great number of development projects need a fresh infusion of capital. The success of the foreclosure event also bodes well to the state which has been struggling to revive condominium projects.

Barry Sternlicht of Starwood Capital Group led a group of investors who bid for condominium projects once owned by Corus Bank at the FDIC auction. Corus, a bank that specialized in condominium lending, was taken under federal control last month.

The FDIC auction of repossessed property for sale attracted about eight bidders. The condominium deal includes the FDIC as majority partner. Under the deal, the group of Starwood will get 40 percent equity share in the loan pool, paying $554 million. Sixty percent of the loan pool, amounting to $831.6 million goes to the FDIC.

Starwood partners, including Texas Pacific Group Capital, billionaire Wilbur Ross and Perry Capital, bid on the 112 construction loans under the Corus portfolio. According to market data, over two-thirds of the Corus portfolio are delinquent or in foreclosure.

Starwood and partners will need to decide on how they will handle the troubled condominium projects, their developers and properties that are at risk of foreclosure. Some of the troubled condominium projects in Tampa Bay area under the Corus portfolio are Element with $84.3 million debt, Tuscany with $23.5 million and Arbors at Branch Creek with a loan of $52.6 million and at Carrollwood with $47 million.

Meanwhile, other notable condominium buying deals include Minto Communities Inc.’s acquisition of a 352-acre condominium project located in Perico Island. The project was previously owned by St. Joe Co. According to Minto, it plans to continue the project according to the specifications of its previous owner. So far, the deal is the largest acquisition in southwest Florida.

Industry experts hope that the success of FDIC auction of repossessed property for sale would revive the condominium market in the area.

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