Facing foreclosure on its development site in Boca Raton, Penn-Florida Companies sold the 1-acre lot previously planned for an assisted living facility for $27 million.
Led by Mark Gensheimer, Penn-Florida sold the vacant property at 375 East Royal Palm Road to Boca Raton-based SobelCo, according to records and real estate database Vizzda. SobelCo, a real estate development, investment, management and leasing firm led by Jeffrey Sobel, also purchased the adjacent 0.2-acre vacant site at 343 East Royal Palm Road for $3.1 million from an entity managed by McFillin of Delray Beach.
In total, SobelCo paid $30.1 million for 1.2 acres of developable land. It scored a $10 million loan from Goldman Sachs for the purchase, Vizzda records show.
The smaller lot at 343 East Royal Palm Road is approved for a four-unit luxury residential building with five stories and a rooftop, according to a marketing brochure.
Boca Raton-based Penn-Florida had a long-pending plan for an upscale 193-unit assisted living facility on the site at 375 East Royal Palm Road. The Boca Raton Planning and Zoning Board approved the project in 2017, and Penn-Florida subsequently demolished the two-story building that was on the site, records show. Construction of the assisted living facility never started.
Penn-Florida had paid $1.2 million for the property and adjacent sites in 2005, according to records. In 2016, the firm borrowed $2.5 million on the land from City National Bank of Florida, bumping it to $5.7 million in three loan modification agreements in 2019, 2020 and 2023, according to records.
Last year, City National Bank of Florida reassigned the loan to an affiliate of Miami Beach-based distressed debt investor Safe Harbor Equity, led by Rafael Serrano. Safe Harbor filed a foreclosure on the $5.7 million loan against Penn-Florida and Gensheimer, the loan’s guarantor, alleging Penn-Florida defaulted on the 2024 maturity and the full loan balance is due.
The recent site sale resolved the pending foreclosure, according to court records. On Monday, a court filing by Palm Beach County Circuit Court Judge Carolyn Bell shows that Safe Harbor, Penn-Florida and Gensheimer submitted a letter notifying the court the case has been settled. Bell ordered the parties to file the proper dismissal papers, a procedural step.
SobelCo andPenn-Florida didn’t immediately return requests for comment.
Penn-Florida has been facing financial woes on several of its South Florida properties and projects. Its troubles come amid elevated interest rates, skyrocketing insurance and higher construction and labor costs. Many developers are stepping back from planned projects and listing their sites for sale amid struggles to pay debt obligations on floating rate loans, or they are unable to refinance. Banks have generally retrenched from providing new loans.
In Boca Raton, Blackstone Mortgage Trust filed a $145 million Uniform Commercial Code foreclosure against a Penn-Florida affiliate on its 366-unit 101 Via Mizner apartment building at 101 East Camino Real last year. Penn-Florida’s affiliate filed for bankruptcy in January, warding off the scheduled foreclosure auction. In July, federal bankruptcy court Judge Erik Kimball approved a $235 million sale of the property to a joint venture between Penn-Florida and crowdfunding multifamily syndicator Grant Cardone.
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