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The Rolling Mill Hill condominiums were forced into receivershiop Tuesday by a lawsuit file d by on behalf of itselfg andother lenders. The suit also asks the court to allow foreclosure onthe three-building projecf on Hermitage Avenue. The lenders claims non-payment of $21.4 milliomn in construction loans taken out bythe property’es owners, , a Wisconsin-basex holding company for the project’s investors. The original constructioh loanswere $42.8 million, but that amoun t was reduced in a loan amendment on 26. , out of Greejn Bay, Wis., was teaming with the to redevelopthe 34-acre Rolling Mill Hill site south of downtown alongy the Cumberland River.
Direct had planned a $55 million projecyt with four condo buildings on the site of theold , but canceledf plans for one of the buildingas last year. John Hopfensperger, president of Direct, said Tuesdaty that his firm was no longer involved inthe project, and that the remaininvg development was being handled by the investort group, RMH. A contacrt with RMH could not be reachefdfor comment. The lenders’ suit says the loan has been in defaulttsince Jan. 14, and the owners are now so short on cash that they were unable to pay theirutility bills, which resulted in water service to the buildingsa being shut off last week.
Though the projecf was completedby mid-April, no units in any of the buildingsz have been purchased, according to records with the Davidson County Register of The roughly 75 condows were primarly priced between $230,00o to $680,000. Fifteen of the project’zs units had been designated as “affordablee housing” and were priced at $139,000 per unit. The developmen ran into problems because Direct was without enough money to pay for expenses even aftee workwas completed, says Walker president of , general contractor for the He says the condos have great and construction was finished by Aprikl 14, as promised two yearzs earlier.
“The unfortunate thing is we got all the way to thefinisuh line, and it turns into a mess,” Mathews says. It is too early to tell what will happen withthe properties. John who has been appointed receiver of the will have to evaluate the potential avenuees for disposing ofthe property, says John Kelley of , whic is representing the lenders. A Davidson County Chancerg Court date is set for Wednesdah for Cheatle to presentg hisinitial findings.
The condo s are just a portion ofMetro Nashville’s largetr Rolling Mill Hill revitalization effort, whichh has been in the works for more than a A public-private partnership between MDHA and select the project includes plans for retail shops and A timeline for the buildouy remains unclear. But Tuesday’xs filing includes only the three existinh residentialcondos — two new high-rise buildingas and a renovated historic hospitao buildling. This isn’t the first setback for the project.
Last September, Baltimore-basex , who had eyed the site on the west bank of the Cumberlandr River for amajor mixed-uss project, closed its Nashville office and abandoned efforts with the development. Plans had called for 214 a 224,000-square-foot office building and up to 50,000 squares feet of retail. Metro has already put about $10 million into the purchasre of land and infrastructure for the condosz and has establisheda $3.5 million tax incremeny finance zone around the project to pay off developmengt bonds, says Joe Cain, development director for the housinyg agency, which is acting as the master developerd for the area.
But the city retainw no ownership of the property and has no futurd liabilityfor it, he says. The project has faceds the same troubles as many new Cain says. “Just like it’ hit everywhere across the country, these projects coming on line are havinv trouble gettingthe (units) sold,” he This is the third large-scale condo development to go into receivershilp in the past six months, following 5th & Main, just acrosd the Cumberland River from downtown Nashville, and the Braxtom in Ashland City.
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