Ibiza Condos Turning into Apartments
The Ibiza condo project in the Short North has faced numerous delays since its announcement in 2006, and the lack of communication over the course of the past year have left many wondering if that dirt lot at High & Hubbard would ever see progress on construction.
The veil of silence has just been lifted, and condo pre-buyers were informed via email that the project will now be moving forward as an apartment building instead. The developers are saying that there will be minimal design changes to the project, and that buyers would receive refunds on their investment in due time.
The full email can be found below:
As you know, we have spent a year and tens of thousands of dollars to procure financing for the construction of IBIZA. The meltdown of the mortgage market has placed our primary lender in the position of being unable to take on new real estate loans at this time. (We had already begun construction with the assurance that our loan from that lender was in place.) Other lenders have reviewed the project and have even tentatively agreed to proceed, only to find out that they, too, were restrained by their liquidity and other issues unrelated to the economic viability of the project. (One of the reasons the lenders were so interested was that the loan-to-value ratio of the project would be 61%.) On the other hand, a number of lenders have indicated to us that they are ready and willing to proceed promptly with the necessary funding of the project as an apartment project. (Ironically, the rules for individual condominium unit loans have also changed, making it problematic for our buyers to obtain loans which, just a short while ago, were readily available.)
The probable impossibility of proceeding as a condominium is forcing us, reluctantly, to shift our focus to obtain financing for the construction of IBIZA as an apartment project. Millions have been spent through and including the commencement of construction, and only minor changes in layout and design will be required to make the project appropriate for apartments. (We will try to maintain the flexibility of keeping the option open for conversion at a later date when the market and lending rules permit.) We will be working with each buyer to refund their deposit. This will require a period of time to accomplish. We truly regret this complication.
We are diligently working with our lenders, architect, and legal team to accomplish this end. Once the project is funded, we will refund all of your deposits and statutorily required interest.
We are truly sorry for this turn of events, but it has been out of our control.
Thanks for understanding and working with us to make this a successful transition.
APEX Realty Enterprises, LLC