RCA in the commercial property press:

Report: Fla. ranks No. 3 for financially distressed projects

Triangle Business Journal reports: South Florida ranks third in nation for the volume of commercial real estate and condo projects now at some level of financial distress, according to a new report from Real Capital Analytics.

The region has 232 known troubled assets, representing $6.3 billion in problematic loans, the RCA data showed

That is less than the $9.2 billion in troubled properties in metropolitan New York City and $8.1 billion in greater Las Vegas. RCA has identified $86.8 billion in trouble assets nationwide.

South Florida’s mounting pile of troubled assets is larger than the metropolitan areas of Los Angeles, with $5.8 billion: Chicago, $3.5 billion; Phoenix, $3.1 billion; San Francisco, $2.7 billion; Dallas, $2.1 billion; Houston, $2 billion; and Atlanta, $1.7 billion.

“There is no question that Florida has been very heavily hit, mainly due to oversupply issues,” said Dan Fasulo, RCA’s managing director. “There has certainly been a plethora of failed developments.”

Trump International Hotel and Tower in Fort Lauderdale, Paramount Bay in Miami and the Shops at Sunset Place in South Miami are among the most recent projects that RCA has added to its Troubled Assets Radar report, which will now be issued quarterly.

RCA also listed Mint at Riverfront, but developer Inigo Ardid, VP of Development at Key International, said the project is not in distress. The loan doesn't mature until late this year, Ardid said.

To be listed, Fasulo said, a project has to be at some level of default on its loan.

“It doesn’t mean that at some point they won’t work it out, but we have hard evidence that a development is in trouble,” he said.

Corus Bank, the lender on the Trump, Mint and Paramount Bay projects, disclosed earlier this month that nearly all of its $1.1 billion in loans to South Florida projects were impaired.

The Shops at Sunset Place is the latest Simon Property Group retail center to surface, gulping for financial air. On April 14, Wells Fargo, acting as a trustee for a commercial mortgage-backed securities fund, filed a foreclosure lawsuit against the Simon-run Palm Beach Mall over a $55.4 million leasehold mortgage.

RCA identifies Sunset Place as being past due on a maturing $74.7 million CMBS loan.

Simon spokesman Les Morris did not return phone calls seeking comment.

“Obviously, the economy has affected the retail spender in this country,” Fasulo said. “That was going to trickle down and affect the tenants and, eventually, the owners.”