Filed under: Real Estate Developments
It is one of Atlanta's grandest new developments but the Mansion on Peachtree may be in deep financial trouble. According to the Atlanta Business Chronicle, the project is facing foreclosure. The project developer has said that a 30-day foreclosure notice is expected tomorrow unless something else happens. Last week Clark Butler, president of City Centre Properties LLC and Mansion Centre Development LLC said that he was in discussion with lenders to work out a deal. If no deal is reached iStar Financial, the primary lender, would receive the property. First Citizens Bank is a secondary lender holding the mezzanine debt. The Atlanta Business Chronicle article reports a total debt of $187.4 million which is above the original estimated price of the project, $165 million.
The Mansion at Peachtree is home to luxury condos and a five-star hotel operated by Rosewood Hotels & Resorts. The building also includes NEO, a contemporary Italian restaurant, the fourth location of Craft from restaurateur Tom Colicchio. Craft Atlanta and the 29 Spa. The project was announced to great fanfare back in 2006 but by the time it opened in 2008 the Atlanta real estate market was already mid-slump. Some people who wanted to get into the project couldn't sell the homes they already owned and the high prices of the condos dwarfed the prices of some homes in the area. Last June a penthouse in the mansion sold for $4 million but it was originally listed at $10.2 million. Tourism continues to be fairly sluggish in Atlanta so the project has been hit from two angles. The developer insists that its a great project, just one that launched at an unfortunate time.