Costa Hollywood Beach Resort’s unsold units were slated for a bankruptcy auction and generated plenty of interest but no qualified bidders, more than likely because the coronavirus pandemic put the hospitality industry in a historic nosedive, Law.com reported. 777 N. Ocean Drive LLC, the lender on the project that sought to foreclose on the development team after it stopped paying, is in line to buy the unsold units under its $43 million stalking-horse bid. The lender, an affiliate of New York-based private equity firm Madison Realty Capital, offered a credit bid, which counts against the overdue loan. Bankruptcy Judge A. Jay Cristol of the Southern District of Florida set a hearing on a final sale for Aug. 26. “In this market, especially after COVID hit, it’s a little bit harder to take out a secured lender that’s coming in with a credit bid of $43 million. It’s a lot of money,” said debtor’s attorney James Moon. Moon, a partner at Meland Budwick in Miami, said he doesn’t know if the pandemic is to blame but guesses that’s the reason for an absence of bidders. Over 180 groups expressed interest, signing confidentiality agreements with broker Cushman & Wakefield, but none qualified. The 326-unit Costa Hollywood condominium-hotel became distressed before the coronavirus pandemic. The lender, which issued $70 million in project financing in 2016, filed for foreclosure in Broward Circuit Court in April 2019 against the development group, Costa Hollywood Property Owner LLC. It’s led by developer Moses Bensusan, CEO of the Liberty Grande LLC real estate firm. Costa Hollywood, which owns 43 unsold residential units, nine commercial units and the common area, filed for chapter 11 reorganization last September. Qualified bids were due last Thursday, but with no bidders an auction scheduled for Monday wasn’t held.
