UPDATED 7/3/24 4:25pm
The building that was poised to be Kenny Wolfe’s first office-to-resi success is facing foreclosure.
New York-based Maltz Auctions is auctioning a stake at The Bell, at 45 Erieview Plaza in downtown Cleveland. The auction will take place on July 12 at 11 a.m.
Dallas-based syndicator Wolfe, who previously focused on multifamily deals, made the ambitious jump to office-to-residential projects in 2020, taking on seven projects in three cities over four years, including The Bell.
Wolfe teamed up with fellow Dallas-based developer Bluelofts to buy the 16-story building for $21 million in 2022, Cleveland.com reported. It was supposed to open this summer.
A source familiar with the project said construction is complete, but the building doesn’t have signage.
The stake is being auctioned after Wolfe allegedly defaulted on a $7.5 million bridge loan from New York-based lender TBG Funding. Specifically, the asset for sale is the 100 percent interest in 45 Erieview LLC, the entity that owns the ground under the building.
Wolfe has already lost two office-to-resi conversion projects to foreclosure. Earlier this year, he returned the keys to a building in downtown Dallas and another in downtown Fort Worth.
The former, at 211 North Ervay, fetched $8 million — a mere $42 per square foot — at a foreclosure auction in February. Wolfe had planned to turn the building apartments before he defaulted on a $13.2 million loan from Thistle Creek Capital.
The deed to the Oil & Gas Building, at 307-309 West Seventh Street in downtown Fort Worth, also went back to Wolfe’s lenders earlier this year. Both properties were purchased in partnership with Bluelofts and slated for resi conversions.
Wolfe and Bluelofts bought the 135,000-square-foot Oil & Gas building in 2021 with plans to convert the 48-year-old building into apartments.
He also faces foreclosure on 41 Marietta Street, an Atlanta office building slated for residential redevelopment after he and frequent collaborator Bluelofts defaulted on a $20 million mortgage, the Atlanta Journal-Constitution reportedWolfe isn’t the only Texas-based syndicator facing foreclosures after scooping up properties in the boom between 2019 and 2022. GVA, Elevate and A&R Multifamily have also lost properties acquired at that time.
This story was updated to reflect that a stake in The Bell is being auctioned, not the building.
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