Check this out!
Developer of the Round in Beaverton defaults on loan
The California firm also hasn't paid property taxes on undeveloped land
Saturday, May 31, 2008
DAVID R. ANDERSON
The Oregonian
BEAVERTON -- The developer of the Round at Beaverton Central is in default on a $2.9 million loan and didn't pay property taxes last year on its undeveloped properties, according to legal documents.
The latest legal twist could mean the end for the second developer at the urban-style development along the MAX light rail, which remains little more than half-built after 11 years.
The setback also raises more questions about the city's attempts to extend the Round to the adjacent Westgate Theatre site. The only developer interested in purchasing that vacant property from the city and Metro, the regional government, is still looking for financing.
The creditor of the Round, Drawbridge Special Opportunities Fund, has filed a notice of foreclosure in Washington County against DPP Beaverton Commercial Investments, a subsidiary of Dorn-Platz Properties of California.
This is the second time in less than a year that a lender has foreclosed on the property. In July 2007, another lender associated with Fortress Investment Group, a New York hedge fund, claimed that Dorn-Platz had defaulted on a $31.5 million loan.
Dorn-Platz settled that in September by transferring ownership of completed buildings to Fortress.
However, Dorn-Platz retained ownership of four vacant parcels and told city officials it was attempting to get new financing to complete the three remaining buildings.
That continues to be the latest message from Dorn-Platz officials, City Attorney Alan Rappleyea said Friday.
"But we've heard that before," Rappleyea said.
In the latest foreclosure, the lender claims that Dorn-Platz has not paid on the second loan since November 2006 and owes $23,300 in delinquent property taxes.
Representatives of Dorn-Platz did not return telephone calls Friday. Douglas Cushing, the Portland lawyer representing Fortress, also could not be reached for comment.
The city of Beaverton had no legal interest in the completed buildings during the foreclosure last year, Rappleyea said. But a development agreement between the city and Dorn-Platz covers the unfinished properties. That agreement calls for the project to be completed by the beginning of 2009.
Rappleyea said city officials would let the foreclosure proceedings play out and deal with whichever company ends up owning the vacant land.
The city land-use and building permits for the remaining buildings have lapsed, and Dorn-Platz has done nothing to renew them, Rappleyea said.
The Round has struggled since 1997, when the city sold the former site of a sewage treatment plant to a developer and called for multistory buildings with ground-floor retail and restaurants and housing and offices above.
The first developer declared bankruptcy, and the city resumed control of the site in 2001. Later that year, Dorn-Platz took over the project.
However, the city later declared Dorn-Platz in default of its development agreement, penalized the developer and signed a new agreement in June 2005.
Four buildings are complete. Three or four more buildings are scheduled to be built.
David R. Anderson: 503-294-5199; davidanderson@ news.oregonian.com
http://www.oregonlive.com/news/orego...080.xml&coll=7