Luxury condos on the road to foreclosure

by Jahna Berry - Jan. 19, 2010
The Arizona Republic

Most of the units in 44 Monroe, the swank, 196-unit luxury high-rise could be headed for foreclosure. The bank has filed a notice of trustee's sale, the first step toward taking over 182 unsold condos.

The units are scheduled to be sold to the highest bidder on April 14, according to county documents. A notice of trustee's sale doesn't always end in foreclosure but it's a signal that the project has serious financial problems.

The 44 Monroe owes Corus Construction Venture, LLC $86.8 million, according to county documents. Officials at Grace Communities, the project's Scottsdale developer, declined to comment on today. The project near 1st Ave. and Monroe St. was completed in 2008.

44 Monroe's lender collapsed and was taken over last year by the FDIC, which owns a 60 percent stake in Corus Construction Venture, LLC. The rest is of the firm is owned by private equity consortium led by Starwood Capital Group.

This is the second upscale high rise in the heart of downtown Phoenix to face financial trouble in recent months. The Summit at Copper Square, a 165-unit condo complex, sought Chapter 11 protection October. The developer headed to bankruptcy court to stop its lender from foreclosing on 74 unsold units.

The Summit's bank, Scottsdale's Stearns Bank, filed a notice of trustee sale last summer.

Before the recession and the housing bust crippled the economy, Phoenix leaders hoped that affluent condo dwellers who lived in projects like 44 Monroe and the Summit would help revive downtown Phoenix.