PINELLAS PARK — The attorney for Shoppes at Park Place, the mega shopping center hit with a $73 million foreclosure suit, says the owner has made all payments on time but has been stymied by the lender in attempts to refinance.
In a countersuit, lawyer Jon B. Coats Jr. says U.S. Bank indicated it would refinance or extend its loan, then foreclosed a day after pressuring the Shoppes’ owner into waiving its right to fight any foreclosure.
With no explanation, the bank "abruptly halted negotiations and any consideration of a simple four-month extension to allow (the owner) to complete a refinance," the countersuit alleges.
Coats said Wednesday that the Shoppes’ owner had paid the bank’s loan servicer $5.5 million since the foreclosure suit was filed in March 2017 and had an "impeccable payment history" before that.
"It’s not a borrower who has defaulted on a loan," Coats said. "It’s a borrower who’s a victim of a special servicer we can’t help but thinking is trying to get their hands on $30 million." He said the Shoppes, whose tenants include Marshalls, Office Depot and a movie theater, has been valued at $105 million or about $30 million more than the $74 million currently owed with interest on the loan.
The open air shopping center at the corner of U.S. 19 and Park Boulevard was built in the mid 2000s by KB Parkside LLC, controlled by developer Robert Schmidt. The original loan was an interest-only note due in full in January 2017.
Shortly before the loan came due, Schmidt thought he had refinancing agreement with Goldman Sachs but "Goldman pulled the rug out," Coats said. At that point, Schmidt discovered the loan had been securitized and transferred but it took some time to determine who had it.
"Finally C-III shows up." Coats said, referring to the Dallas-based company that services the loan for U.S. Bank, which in turn is trustee for the mortgage-backed security.
Coats said C-III and the bank expressed a willingness to work with Schmidt but only if his company signed a "pre-negotiation agreement" waiving its rights to sue or defend itself in any actions involving the bank.
""They said, ‘That’s the only way we’ll talk’ so (Schmidt) signed the letter and the next day they foreclosed," Coats said.
Neither Schmidt, who is mayor of Belleair Shore, nor an attorney for the bank returned calls for comment.
Although the Shoppes at Park Place is currently on the market, Schmidt is "very confident" he will be able to refinance and keep it, Coats said. The center is 97 percent occupied and generates an average of more than $500,000 a month in rent.
"Part of the battle is the bank is trying to take over the entire shopping center by removing the current management and having all the rents paid to them, which we believe is just another attempt to kill the ability of the borrower to refinance," Coats said.
Contact Susan Taylor Martin at [email protected] or (727) 893-8642. Follow @susanskate