Florida moves on after failure of bank behind condo boom

Miami HeraldSeptember 15, 2009 

Following the failure of Chicago's Corus Bankshares and its seizure by federal regulators, speculation Monday focused on the fate of the lender's $4 billion in commercial loans, a good quarter of them secured by condominium projects in South Florida.

FDIC spokeswoman LaJuan Williams-Dickerson said regulators would begin marketing the assets to potential buyers for a private placement transaction that is expected to be completed in about 30 days. She could not say whether the assets would be sold to a single buyer or in loan pools.

Corus was one of the largest condominium construction lenders in South Florida during the real estate boom, financing 34 projects in Miami-Dade, Broward and Palm Beach counties. It held more than $1 billion in South Florida loans at the time of its Friday seizure, most of which were nonperforming.

Much like a death after a long and painful illness, Corus' failure was met with a sense of closure and relief from some local real estate analysts and developers, who said now the condo market could hit the reset switch and begin moving forward.

"They made all the loans that shouldn't have been made right at the end of the cycle. They represented the largest portfolio of troubled projects, so, in that respect it's kind of like the last hurrah," said Jack Lowell, vice president of Coral Gables-based Flagler Real Estate Services.

Corus also controlled a large portion of the unsold condo units in the greater downtown Miami market. A new investor, who would not be fighting to minimize losses, would likely slash prices to quickly sell inventory.

"That will be good for pre-sale buyers and new buyers," said Inigo Ardid, vice president of Key International, which developed Ivy and Mint with Corus financing.

Read more at MiamiHerald.com

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