Developers of The Braxton Are Sued

This article was published in The Nashville Post on February 20th. It is entitled, “Waterfront condo buyers want earnest money back”:

Nine pre-sale buyers of condos in the Harpeth Shoals (The Braxton) waterfront development in Ashland City yesterday filed suit against The Braxton LLC, the firm behind the condos and one of several companies run by developer John T. Rankin, who has listed debts of $73.2 million in his personal bankruptcy.

Suing in Nashville’s federal court, the would-be homeowners claim their units still are not ready, months after a contractual closing date of August 4, 2008. They also say Rankin promised them Harpeth Shoals would include destination attractions such as a restaurant and retail shops, none of which have come to pass. They are asking for the return of their earnest money – a total of just under $400,000 – plus other damages.

A copy of the complaint is available at this link. Philip Byron Jones of Evans, Jones & Reynolds in Nashville represents the plaintiffs.

Rankin has recently tried to withdraw the Chapter 7 bankruptcy filing he personally made late last year, acting “pro se” (without an attorney). As mentioned in The City Paper’s “Headline Homes” column this month, the bankruptcy court had permitted a lender to foreclose on his massive house in Hill Place, taking title to it for $1.66 million after it was on the market for $3.75 million last year.

Representatives of the bankruptcy trustee, opposing Rankin’s motion for dismissal, claimed in court filings that he had been “recalcitrant” in dealing with them and that his case did not pass the “smell-test.”

Rankin attributed his mistakes in handling the case to “pro se fumbling.” Shortly before the court denied his motion to dismiss last month, he sent notice that he “no longer has a home address.”Attempts to reach Rankin today have been unsuccessful.

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Developers of The Braxton Are Sued

This article was published in The Nashville Post on February 20th. It is entitled, “Waterfront condo buyers want earnest money back“:

Nine pre-sale buyers of condos in the Harpeth Shoals (The Braxton) waterfront development in Ashland City yesterday filed suit against The Braxton LLC, the firm behind the condos and one of several companies run by developer John T. Rankin, who has listed debts of $73.2 million in his personal bankruptcy.

Suing in Nashville’s federal court, the would-be homeowners claim their units still are not ready, months after a contractual closing date of August 4, 2008. They also say Rankin promised them Harpeth Shoals would include destination attractions such as a restaurant and retail shops, none of which have come to pass. They are asking for the return of their earnest money – a total of just under $400,000 – plus other damages.

A copy of the complaint is available at this link. Philip Byron Jones of Evans, Jones & Reynolds in Nashville represents the plaintiffs.

Rankin has recently tried to withdraw the Chapter 7 bankruptcy filing he personally made late last year, acting “pro se” (without an attorney). As mentioned in The City Paper’s “Headline Homes” column this month, the bankruptcy court had permitted a lender to foreclose on his massive house in Hill Place, taking title to it for $1.66 million after it was on the market for $3.75 million last year.

Representatives of the bankruptcy trustee, opposing Rankin’s motion for dismissal, claimed in court filings that he had been “recalcitrant” in dealing with them and that his case did not pass the “smell-test.”

Rankin attributed his mistakes in handling the case to “pro se fumbling.” Shortly before the court denied his motion to dismiss last month, he sent notice that he “no longer has a home address.”Attempts to reach Rankin today have been unsuccessful.

Bristol Development May Sue..Continued

Okay, now that I have had an opportunity to reflect and consider, here are my thoughts at this point:

1) I am not an attorney and my advise/point of view is not a legal opinion
2) I am a Realtor who represents almost 50 purchasers of Bristol Development’s projects, I am also a buyer in these projects
3) I am a fair and reasonable person who considers myself an advocate for my clients and the city of Nashville alike

These are extraordinary economic times. Many of us have never experienced an economy or a banking atmosphere anything like the one we currently experience. It is scary, it is terrifying, and it is uncharted.

That being said, it is my suggestion that we all put the cards on the table and stop playing this high stakes game of poker. It is time for a truce and for cooler heads to prevail.

No one deserves to make a profit on the purchase of their Icon purchase. The buyer, the seller, the developer or the builder. Seriously. We have all taken a risk. The developer has taken a risk with the bank, the buyer has taken a risk with the developer and their own bank, the construction company has also taken a risk with their bank and the developer. Without going into a huge analysis or dissertation on how the American banking industry has crippled, fooled and hurt us all, here is my suggestion.

Buyers who have contracted to purchase a condo in the Icon, including myself, you need to consummate your purchase. Why? Because you signed a piece of paper that promised you would. But, you are not going to pay what your contract says. Instead, the developer, builder and all banks involved are going to sit down in an open forum to share their actual, to date costs with all of us. We are all going to agree that interest is out the window and that actual, hard costs are the key to this equation.

Listen, no one wins here…but, no one loses either. We ALL have taken a risk and we all were wrong. That does not mean that one party or the other needs to be left holding the bag. Buyers, the Bristol Development Group shouldn’t bear all of the costs. Sellers, same thing. These buyers don’t owe you more than what the market will bear. This is simply true and no one will ever be able to squeeze water out of a stone.

Seriously, we have a unique opportunity to pave a bold new road in these ridiculous economic times. It is a road of compromise and a road of equitable fairness. I am bold enough to walk down this path. The question is, are you?

UPDATE 6/5/09:

It was reported in the Nashville Business Journal today that the Bristol Development Group has indeed filed lawsuits against 3 individuals for damages totaling around $80,000. When asked by the NBJ as to Bristol’s motivation for bringing these lawsuits, CEO Charles Carlisle simply replied, “People who sign a contract should expect to perform.” It is interesting to note that the Bristol Group was able to resell all of the condos that fell out of contract, some for higher prices.

I am no fool, it is clear to me that Bristol is sending this loud and clear message: If you don’t plan on closing on your contracted condo, you will get sued no matter if we resell your unit or not.

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Bristol Development May Sue..Continued

Okay, now that I have had an opportunity to reflect and consider, here are my thoughts at this point:

1) I am not an attorney and my advice/point of view is not a legal opinion
2) I am a Realtor who represents almost 50 purchasers of Bristol Development’s projects, I am also a buyer in these projects
3) I am a fair and reasonable person who considers myself an advocate for my clients and the city of Nashville alike

These are extraordinary economic times. Many of us have never experienced an economy or a banking atmosphere anything like the one we currently experience. It is scary, it is terrifying, and it is uncharted.

That being said, it is my suggestion that we all put the cards on the table and stop playing this high stakes game of real estate poker. It is time for a truce and for cooler heads to prevail.

No one deserves to make a profit on the purchase of their Icon purchase. The buyer, the seller, the developer or the builder. Seriously. We have all taken a risk. The developer has taken a risk with the bank, the buyer has taken a risk with the developer and their own bank, the construction company has also taken a risk with their bank and the developer. Without going into a huge analysis or dissertation on how the American banking industry has crippled, fooled and hurt us all, here is my suggestion:

Buyers who have contracted to purchase a condo in the Icon, including myself, you need to consummate your purchase. Why? Because you signed a piece of paper that promised you would. But, you are not going to pay what your contract says. Instead, the developer, builder and all banks involved are going to sit down in an open forum to share their actual, to date costs with all of us. We are all going to agree that interest is out the window and that actual, hard costs are the key to this equation.

Listen, no one wins here…but, no one loses either. We ALL have taken a risk and we all were wrong. That does not mean that one party or the other needs to be left holding the bag. Buyers, the Bristol Development Group shouldn’t bear all of the costs. Sellers, same thing. These buyers don’t owe you more than what the market will bear. This is simply true and no one will ever be able to squeeze water out of a stone.

Seriously, we have a unique opportunity to pave a bold new road in these ridiculous economic times. It is a road of compromise and a road of equitable fairness. I am bold enough to walk down this path. The question is, are you?

UPDATE 6/5/09:

It was reported in the Nashville Business Journal today that the Bristol Development Group has indeed filed lawsuits against 3 individuals for damages totaling around $80,000. When asked by the NBJ as to Bristol’s motivation for bringing these lawsuits, CEO Charles Carlisle simply replied, “People who sign a contract should expect to perform.” It is interesting to note that the Bristol Group was able to resell all of the condos that fell out of contract, some for higher prices.

I am no fool, it is clear to me that Bristol is sending this loud and clear message: If you don’t plan on closing on your contracted condo, you will get sued no matter if we resell your unit or not. It is also clear that the developers aim to keep this entire project under contract as long as possible in order to comply with the new FHA loan guidelines.

UPDATE 7/27/09:

I just found out that a subcontractor had placed a mechanics lien on the Icon several months ago and that Doster, the construction company on the Velocity project has placed a $570,000+ lien on that project as well. Remember what I said about everyone losing? The Icon and Velocity are just lucky that their equity partner, MarketStreet Enterprises, has some of the deepest pockets in the US.

Nashville Mortgage Rates Fall

Nashville mortgage rates fall, so do home sales and prices

A dip in the long-term mortgage rate offered homeowners a refinancing opportunity, according to Freddie Mac, which said average interest on 30-year fixed loans fell to 5.16% from 5.25% last week. Interest on 15-year fixed loans also declined, slipping to 4.81% from 4.92%.

It would be naive of us to predict Nashville home sales to increase due to this mortgage rate slide, but a little voice inside us is still hoping it will help persuade those still on the fence.

This Nashville mortgage rate drop is not helping the commercial real estate market though, vacancy rates continue to rise as cap rates begin to drastically fall. Look for a ‘rubber ball bounce’ in the Nashville retail space market over the next 3 months.

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Nashville Mortgage Rates Fall

Nashville mortgage rates fall, so do home sales and prices

A dip in the long-term mortgage rate offered homeowners a refinancing opportunity, according to Freddie Mac, which said average interest on 30-year fixed loans fell to 5.16% from 5.25% last week. Interest on 15-year fixed loans also declined, slipping to 4.81% from 4.92%.
 
It would be naive of us to predict Nashville home sales to increase due to this mortgage rate slide, but a little voice inside us is still hoping it will help persuade those still on the fence.
 
This Nashville mortgage rate drop is not helping the commercial real estate market though, vacancy rates continue to rise as cap rates begin to drastically fall. Look for a ‘rubber ball bounce’ in the Nashville retail space market over the next 3 months. After the artificial gain, look for the retail market it to give it all back and then some by the end of the year.

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