The majority owner of the condos at Bushnell on the Park gets another chance to avoid foreclosure
February 16, 2010
Imagine paying $400 to $500 a month into a condo association where you live and having no idea what is happening to your money, whether or not it's going toward maintaining your building.
Furthermore, imagine that your requests of the officers of your condo association to account for the whereabouts of your money go unanswered and ignored. And finally imagine a single entity that owns more than 70 percent of the units in your building — and thereby controls the condo association — refuses to tell you whether it is even paying the association fees it owes each month.
That's exactly what's happening to 51 condominium owners at Bushnell on the Park, the downtown building facing Bushnell Park that has been partially in foreclosure for more than a year.
The 51 independent owners are not in foreclosure, but Bushnell Regency LLC, which owns the remaining 129 of the 180 units in the building and controls the condo association, is in foreclosure. It has not paid its mortgage since November 2008, and is under the gun to come up with $9.7 million by March 9 or lose its interest in the building to Wells Fargo bank.
As the Advocate reported last December, Bushnell Regency first had until Jan. 11 to come up with the money. Then it had until Feb. 9. Now it has until March 9 as Wells Fargo apparently continues to hope for a miracle. The amount the bank requires to let Bushnell Regency retain its interest in the building has also been coming down. In February it was $9.8 million. Sources speculate Wells Fargo reduced the amount owed and extended the deadlines as part of a negotiation with Bushnell Regency, which owes a total of $15.2 million on the building. The building was recently appraised at $8.8 million.
Avon attorney Jonathan Starble has been hired by 18 of the 51 independent condo owners to represent their interests in the ongoing foreclosure. The court has given Starble's clients intervenor status in the case; a highly unusual step, according to Starble, which gives them the right to receive notice of all actions in the case and the right "to object and be heard on matters affecting the foreclosure action."
"The officers of the [condominium] association, who have been appointed solely by Bushnell Regency, have refused to respond to our requests for basic financial information," said Starble. "We are in the dark as to what is happening with a significant amount of money."
Starble said the association is violating the state statutes that govern condominium developments by refusing to release financial information. But the court has been focused on the foreclosure action at hand and has not been open to introducing complaints regarding the condominium association into the case.
"Each month 51 unit owners are paying $400 to $500 into an association and do not know what is happening with that money," said Starble. "Meanwhile, they do not know if the Bushnell Regency is paying its condo association fees that amount to 129 times the amount for one unit."
One of the problems Starble wrestles with is determining exactly who the principals are in Bushnell Regency. One, Michael Jaffe of Montvale, N.J., is named as a defendant in the foreclosure action. Jaffe's lawyer had no comment for this story.
"We're trying to identify who are the decision makers within Bushnell Regency," said Starble. Meanwhile, his clients can only wait for March 9 to find out if Bushnell Regency comes up with nearly $10 million.