What’s After this in the 4,000-Acre Foreclosure?

September 23rd, 2009 | Tags: Foreclosure

foreclosure

A Vienna based developer; Greenvest LC bought a land in south-central Loudoun which was 4,154 acres. The land was however foreclosed after the developer defaulted on a payment of $130 million loan. The major lender of the developers later bought the property in an auction for $69 million.

Greenvest, who was to be the largest landowner in the county, had bought the land with the idea of bringing almost 15000 homes there. These plans were however subdued in 2006, when the Loudoun Board of Supervisors voted out the application for Greenvest’s development in Dulles South.

The rejection of application resulted in the financial problems for the company and delay in the development. Local land developers say that with the rejection of the potential development on the land. Very few options are now left.

Steve DeLong of Cavalier Land Development said “I think the lender has to do an analysis of the market,” “I think they certainly made the right decision [in buying the property back]. He further stressed that “It secured their investment, and now they have the opportunity to re-examine what’s best for their investment.”

Delong informed that it could take about six months for istar to come up with certain announcements regarding the property. While many say that it could actually take as much as 5 years.

“They obviously don’t want to develop [the land],” said Lansdowne developer Leonard “Hobie” Mitchel. “They’re not in the development business; they’re in the banking business.”

Local land developers are of the opinion that istar may not develop the land at all and may simply sell. They say that selling this land will not be easy at all.

Roy Barnett of Van Metre Cos said “It’s not something I would be interested in, It’s all large lots and it would have to be all large-lot developments,” he said, which is both costly and hard to do in today’s housing marketplace.

Greenvest was looking at a high density development on this land that was rejected by the county. The land developers thus see that this land will be given for big houses of approximately an acre only.

Barnett said that “Large-lot subdivisions require a higher-price home, which isn’t at the heart of the market right now,”

Mitchel seconded, saying, “The market is still slow.” Homes in the $600,000-and-up price range are not selling like those in the $400,000 range.

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