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| SOUTHEAST TEXAS MORTGAGE, LP |
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| LAKE HOUSTON ESTATES INC. (update 12/29/05) |
UPDATE |
| Partnership Formed: |
Southeast Texas Mortgage, LP M&S Appt 1pm - Sign Order for DS (7327201) EIN 68-0505909 |
| Loan Status: |
Foreclosed 3/04; Litigation Settled 1/31/05; Property Sold 12/29/05 |
| Borrower / Developer: |
Crescent Cove, L.P. - J. Hollis Dealy |
| Develop / Project Stage: |
Claude Wynn inspected the Houston area property 1/17/02. The property is in basically the same condition it was in October 2001 when the last $350,000.00 draw request was made. The property is very large-941 lots with 309 lots in Phase I and 632 lots in later phases. The entire 941 lot tract was cleared and developed for underground and utilities at one time so the site clearing was very aggressively pursued. The front phase could be ready for marketing and the installation of a sales office within 90 days if construction financing is provided. |
| Project Name: |
Garrett Road Estates |
| Property Address: |
Unknown |
| Guarantor: |
Mel Powers |
| Loan Funding Term: |
24 months |
| Original Loan Amount: |
$5,000,000 15% |
| Principal Balance: |
$1,563,750.00 |
| Stage Funding Due: |
$3,100,000.00 |
| Title of Property: |
Lake Houston Estates, Inc. |
| Lien: |
First |
| Advances by Premiere: |
None |
| Exit Strategy: |
Refinance |
| General Partner: |
Jefferson Advisors GP, LLC |
| Loan Maintenance by: |
Jefferson Advisors GP, LLC |
| Opinion: |
Wilson, Cribbs, Goren, and Flaum July 20, 2001 |
| Description of Prop: |
941 manufactured home lot rental community including health club, meeting facilities, swimming pool, and recreation areas; a feasibility study provided to Money Mortgage from Financial Foundations, Inc. is attached. 58 acres.
11/3 The partnership is currently in negotiations to substitute lenders for the remaining balance of the loan.
2/9 The partnership has received notice that the 100 acres in the rear of the property that the partnership had a second lien on was foreclosed in November '02. The new owner of this property is demanding right-of-way through the property that makes up our lien. The borrower, Mel Powers, has been ill for many months and has not been able to work on the project, or to obtain alternate financing. The partnership has engaged Mitch Buchman, attorney, to perform the legal work.
9/22/03 Foreclosure Posted for 11/4/03
4/30/04 The partnership foreclosed on the property. The borrower has filed suit against the partnership for usury and disparagement of the reputation of the borrower. The partnership has responded and has counterclaimed for damages.
9/5/04 The partnership has been sued by the borrower and company for usury and for alledgely not funding the loan. The partership has counter sued and seeks all the funds from the borrower to be returned.
1/15/05 The borrower approximately $1.3MM from the partnership. The construction project was halted by Powers, and the construction site remains the same as it did on October 2001, which is some underground dirt work was performed on the 58 acre tract. The partnership foreclosed on the property, and the property located on Garrett Road in northeast Harris County, is titled in the partnership's name. Powers sued the partnership for usury, fraud and disparagement of reputation. Our attorneys have an interlocutory judgment in our favor as to the usury, and all usury allegations are dismissed. This basically stripped most of Power's case against the partnership. On January 31st, the partnership will mediate with Mr. Powers. If the mediation is not successful, and the partnership does not otherwise settle with Mr. Powers shortly thereafter, the case will go to trial. The trial date is set for May 2, 2005.
1/31/05 The partnership mediated and resolved the matter, pending limited partner approval. The partnership will take a loss of approximately one million dollars.
12/29/05 The property has been sold. The sales price was $469,000.
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Photo of Property, if available:
Notice: The information contained in this summary has been acquired by several sources; there are no warranties expressed or implied as to its accuracy and completeness. All information should be independently verified. Nothing contained on this site should be construed as legal advice. If you have legal issues, you should consult an attorney.
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