Atlantic Beach Developer Puts Fault on Lender

July 26, 2008

By Robert Morris – The Sun News

A N.C. developer said he still plans an upscale resort for his section of the Atlantic Beach waterfront, blaming last week’s multimillion dollar foreclosure notice on the troubled South Florida lending group that handled the loan.

“I don’t want people to think we’re running out of money, broke, the land’s getting foreclosed on and we’re sailing away,” Matt Gadams of N.C.-based Seventh Street Properties said in a telephone interview Thursday. “We’re 100 percent behind this development. We’re going to get it done.”

The attorneys who filed the foreclosure complaint declined to discuss Gadams’ contentions, citing the pending court case.

In 2006, Gadams obtained a mortgage to buy the Atlantic Beach land through an affiliate of The Berman Group in Coconut Grove, Fla., which channeled millions of dollars from hundreds of individual investors into various commercial real estate loans.

Many of those projects were never completed and the loans went unpaid, according to the Florida Office of Financial Regulation. In December, alleging that The Berman Group was mismanaging investors’ money, that state agency gave control of the Berman holdings to a court-appointed attorney, Michael Goldberg of Fort Lauderdale.

Last week, a Greenville attorney representing The Berman Group and its investors filed notice of foreclosure proceedings against Gadams’ companies.

On Thursday, Gadams said he has been repaying his loans, and that the issues surrounding The Berman Group are to blame for the filing.

“This is a legal disagreement that’s going to be fought out in the courts,” Gadams said. “We’re going to file a counterclaim.”



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