Dive Brief:
- Gamma Lending has once again filed notices of foreclosure sale (here and here) for the unfinished $2 billion Wade Park mixed-use development in Frisco, Texas, in an effort to collect $130 million it claims developer Thomas Land & Development owes. The sale is set for Feb. 5.
- Gamma has threatened foreclosure multiple times since February 2018, but this is the first time the property has appeared in the Collin County, Texas, foreclosure listings since October 2018. Wade Park's developers got a reprieve in November and December when they announced they were close to making a deal with JPMorgan Chase for an $850 million loan.
- The 175-acre project has been stalled since 2017, and Thomas Land reportedly still must resolve $10 million in contractor liens for unpaid bills.
Dive Insight:
The Wade Park project seems to be an anomaly in Frisco, where city officials have rebranded the local surge in mixed-use development as the “North Platinum Corridor” in place of the “$5 Billion Mile.” One of the latest projects to receive local zoning approval in Frisco is the $850 million Spring Creek Frisco 45, a high-density, mixed-use development that will include four office towers, parks, a full-service hotel, retail and residential.
But this is likely little solace to Thomas Land, which could be forced to give up its vision for Wade Park, a project to include office, commercial and retail space, as well as for-sale and for-rent residences, a movie theater, a bowling alley and other entertainment venues.
Contractors that have gone unpaid for the labor and materials they provided to the project also may be feeling some financial pain. If there’s an upside, it’s that construction activity is robust in the North Texas market, which includes Dallas and Fort Worth, so there are additional opportunities for contractors and subcontractors that worked on the Wade Park project.
When a contractor is owed a significant amount of money by a client, the resulting financial squeeze can prevent the firm from paying subcontractors, vendors and workers and even force the contractor out of business. This is why, in this busy construction market when many companies have the luxury of turning down work, contractors might consider doing a discreet reference check on potential customers to make sure they have a reputation for paying bills in a timely manner.
