An auction for an 80% interest in 2.3 acres of Colony Beach & Tennis Resort property has been postponed.
Orlando-based Unicorp National Development Inc. President Charles Whittall, who anticipates being awarded the winning bid when the auction is rescheduled in approximately six weeks, said there was a clerical error in an advertisement for the auction and a motion to reschedule the sale will be filed today.
Colony Lender Principal David Siegal said three shell corporations owned by longtime Colony owner Dr. Murray "Murf Klauber that no longer operate (Colony Investors, Colony Services and Le Tennique) were attached to the auction sale.
"One of those corporations that no longer operate filed for bankruptcy yesterday, which triggered the rescheduling of the auction," Siegal said. "We are simply carving off those shell corporations and rescheduling the auction to prevent further delay."
When the auction does occur, most likely in early July, Siegal said he expects Unicorp to be awarded the winning auction bid for an 80% interest in the property.
“I have a signed contract to buy all of Colony Lender assets and expect to purchase the interest at the auction,” Whittall said.
in the meantime, U.S. Bankruptcy Chapter 7 Trustee William Maloney has entered into a contract with Whittall to buy the Colony Partnership's bankrupt estate.
The contract includes a $23 million judgment ruling against Colony unit owners. That judgment includes the losses and damages to Klauber’s management entity, known as the Partnership, which is in Chapter 7 bankruptcy for the Colony Beach & Tennis Resort Association’s failure to pay for assessments and repairs to the resort.
Whittall told the Longboat Observer he entered into the contract with Maloney Wednesday afternoon.
“We’re under contract and it will become official May 27 at a Tampa bankruptcy hearing,” Whittall said.
Maloney chose Whittall’s offer over a offer from the association that was submitted Wednesday, which included financial backing from Longboat Key-based MW Development Group principal Manfred Welfonder; Sarasota Ritz-Carlton and Concession Golf Club & Residence developer Kevin Daves; and Siggy Levy, who has been involved in many development projects in North America, including numerous condominium properties on Longboat Key and some developments with the Four Seasons Hotel Corporation.
Colony unit owner and association board member Blake Fleetwood, though, said the association still has time to counter bid, argue in court on May 27 and appeal the contract to urge U.S. Bankruptcy Judge K. Rodney May to consider their offer later this month.
“It’s not official until Judge May approves it,” Fleetwood said.
Both bids submitted to Maloney were for $2.3 million, although it appears the association’s bid would come with less litigation in the future.
That’s because Whittall has plans to use the judgment to force existing unit owners to pay their bills and infuse money into a dilapidated resort, which could take years and more legal battles to resolve.
If the association receives the estate, along with the judgment, it would come along with a development team that doesn’t plan on coming after unit owners for past due assessments and unpaid bills.
Association President Jay Yablon and Welfonder could not be reached for comment.
For more information, pick up a copy of next week’s Longboat Observer.
Contact Kurt Schultheis at email@example.com.
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- Colony Lender already owns 15% of the 2.3 acre parcels and has contracted to sell that 15% to Unicorp. Once the foreclosure auction occurs, Unicorp will then own 95% of the 2.3 acre parcels which pieces are scattered thru out the total 17 plus acre property making it impossible for the resort to be redeveloped without Unicorp's consent. In addition, the 2.3 acre parcels have an easement for access and for parking.
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