ORLANDO, FL - For the first time since local developer Kevin Azzouz and his Veranda Park development in MetroWest began to stumble more than a year ago, a key piece of the half-built project is now scheduled for a date with the auction block.
Azzouz and a partnership he led in 2005 have been hit with a $15.2 million final judgment in a mortgage-foreclosure suit filed by Fifth Third Bank for one of the major office-condominium buildings in his stalled development in west Orlando.
State Circuit Judge Thomas W. Turner issued the order last week and scheduled a public auction for May 7, at the Orange County Courthouse, to try to sell the property off Grande Avenue to the highest bidder. The condo-office property would revert to the lender if it could not be sold for enough to satisfy the debt.
Azzouz and his VP Phase IV Ltd. partnership defaulted on the project's construction loan in December, at which point the bank exercised its right to call in the entire loan amount of $14.9 million. With late fees and other costs, the total is now more than $15 million and rising at the rate of 8 percent a year.
Hit by last year's global credit crunch and the real estate downturn in late 2007, Azzouz has been slapped with numerous liens and foreclosure suits related to his Veranda Park mixed-use development. Since 2003, Azzouz has built five buildings in the lavish, Italian-villa-style town center, but in recent months work has stalled and a number of restaurants and retail operators have closed as the recession has deepened.
Long-range plans for the project called for the addition of six more buildings, a hotel, movie theater, offices, shops and an outdoor amphitheater.
Azzouz formed a new management company, Veranda Park Properties LLC, last September and said at the time that he planned to press ahead with work in Veranda Park and other local projects. He blamed the rising number of liens and foreclosure suits in Veranda Park on the collapse of the real estate market, lack of financing for buyers he had lined up for his residential-condo units, and a refusal by lenders to provide loan extensions as had been customary in the past.
In the final order issued last week, J. Tufford & Associates, a privately held general contractor that worked on the office condos, also was listed as a defendant. James Tufford, owner of the Altamonte Springs company, would not comment. "I don't have anything to say, at least right now," Tufford said.
Source: OrlandoSentinel.com