After years of construction, it appears time has finally caught up with "The Corner," the posh condos on the corner of South Higgins Avenue and Brooks Street that were listed for sale just as the local high-end real estate market was tanking.
Two weeks ago, project developer and architect Eric Hefty filed for Chapter 11 bankruptcy protection, as did his company, The Corner Development, LLC.
Hefty declined to comment, deferring to his attorney, Harold Dye of the local firm Dye & Moe.
Dye says both The Corner and the adjacent University Apartments on Roosevelt Street, also owned by Hefty, are implicated in the filings. Hefty found himself in a "foreclosure situation" with primary creditor Mountain West Bank, Dye says, and was forced into an emergency bankruptcy filing to protect his assets from the bank's "imminent action."
"We're going to try to sell things in an orderly manner to hopefully pay everybody off," Dye says. "That's the general goal."
According to The Corner's website, two small residential condos and the entire 4,100-square-foot ground floor, designated as commercial space, remain for sale. Prices aren't disclosed.
A year and a half ago, the Missoulian quoted Hefty as expressing concern over the $3 million project's timing, saying it isn't "the best time to be a developer" and that the Missoula condo market is "probably on hold."
A condo glut remains, but 2010 data shows signs of increasing activity.
"Currently, at 178 listings, we have fewer condos on the market than we have had since October of 2008 when we started tracking," says Missoula Organization of Realtors CEO Ruth Link. "That tells us that some of the surplus has begun to be absorbed."
But the absorption has mostly happened at the lower end of the market. The median sales price for condos in 2010 was $164,410, significantly less than The Corner's prices.
Bankruptcy documents estimate The Corner Development's assets at less than $50,000, with liabilities exceeding $1 million. More thorough financial statements will soon be filed, Dye says.