WSG’s Prism Project Gets $27M Foreclosure

Lehman Bros. Holdings is attempting to steal another big project from Miami Beach-based WSG Development Co.

On Dec. 22, the company which has been in Chapter 11 reorganization since 2008, and is based in New York, filed a $27.4 million foreclosure action against WSG West Palm Beach Development, targeting the site of the planned Prism condominium in West Palm Beach.

Several affiliates of Lehman Bros. Holdings took control of 336 units in WSG’s Canyon Ranch residential and hotel condo project in Miami Beach in November, within a $301.2 million action in lieu of foreclosure deal.

Lehman Bros. Holdings’ mortgage to WSG West Palm Beach was last altered at $21 million in 2007. The lawsuit targets about 2.2 acres of property at 2617 N. Flagler Drive that currently has a 24,018-square-foot office building, along with a handful of vacant sites. The developer had purchased the properties for a combined $11.1 million in 2005.

WSG West Palm Beach planned to build the 225-unit Prism on the site, but never began its construction.

Another affiliate of WSG Poinsetta owns a nearby site located at 2609 Poinsettia Ave. Its $3.4 million mortgage with Lehman Bros. Holdings is not in foreclosure.

Via: Biz Journals