The owner of the mixed-use Mainstreet at Tuttle development site in Royal Palm Beach narrowly avoided a foreclosure auction by filing for bankruptcy.
The courthouse sale of the 38-acre site within the 200-acre Tuttle Royale master development on the southwest corner of U.S. 441 and Southern Boulevard was set for Wednesday. But on Tuesday, the ownership entity, managed by project developer Brian Tuttle, filed a Chapter 11 petition in Miami federal bankruptcy court that temporarily halted the auction.
The bankruptcy filing was a direct response to mounting pressure from Mainstreet at Tuttle’s largest creditor, an affiliate of The Fuse Group, a Fort Lauderdale-based firm led by Eyal Peretz, that won a $47.4 million foreclosure judgment against the ownership entity in July, Tuttle told The Real Deal.
In its lawsuit filed last year, The Fuse Group affiliate alleged Mainstreet at Tuttle defaulted on three loans totaling $38.4 million. The judgment includes interest and fees, Palm Beach County Circuit Court records show.
The Fuse Group backed out of an agreement with a new lender that would have resolved the debt, Tuttle said.
“We are incredibly disappointed over the bank’s actions,” he said. “I’m trying to get in front of it. The bank told us what they wanted — we delivered what they wanted, and then they refused to accept it.”
Through its attorney, The Fuse Group affiliate declined comment.
Tuttle has not broken ground on Mainstreet at Tuttle, a planned mixed-use project with 400,000 square feet of retail, 401 apartments, a 125-key hotel, nearly 83,000 square feet of medical offices and three parking garages with 3,435 total spaces.
Mainstreet at Tuttle had lined up Atlanta-based The Ardent Companies to take over as lender, a press release states. On Sept. 16, Ardent agreed to The Fuse Group’s terms that entailed $48 million to buy the loans, a $3 million non-refundable deposit, an additional 25 days of interest charges and a closing within 25 days, Mainstreet at Tuttle’s ownership entity alleged.
Despite receiving a confirmed offer from The Ardent Companies, The Fuse Group allegedly refused to honor the agreement and “declined to accept the full cash payment” on Sept. 19, the release states. As a result, according to the release, Mainstreet at Tuttle had no viable option other than filing for bankruptcy protection.
Other projects with Tuttle Royale remain on track. Tuttle and San Antonio-based Lynd recently completed The Villas at Tuttle Royale, a 400-unit apartment complex at 11200 Nicole Drive. Tuttle has sold other portions of the master-planned community to other developers, including Coconut Grove-based Related Group, which completed a 392-unit apartment complex at 10900 and 11020 Town Circle in 2019. Two years later, Related sold it to New York-based Pantzer Properties for $119.4 million.
Recently, FCI Residential, a subsidiary of the Fanjul family’s sugar empire, started construction of a 320-unit apartment complex consisting of 11 three-story buildings and two two-story townhouse buildings at Tuttle Royale.
