Builder of largely empty Miami condo files for bankruptcy

The maker of Everglades on the Bay — a condo project whose darkened windows have become emblematic of the uninhabited, ghost structures of the building boom gone bust — has become the first of the downtown Miami condo developers to file for Chapter 11 bankruptcy protection.

Cabi Downtown Developers, builder of the 849-unit condominium on Biscayne Boulevard across from Bayfront Park, filed Tuesday in U.S. Bankruptcy Court on Flagler Street in a move that is likely to be followed by other developers as they try to shield themselves from lender foreclosures.

Cabi's largest creditors include Gryphon Construction in Fort Lauderdale, which is owed a disputed $912,272, followed by Miami law firm Siegfried, River, Lerner, De La Torre & Sobel ($395,456), and Holly Sime Realty of Miami ($193,750). The filing said the company has more than 200 creditors and between $100 million and $500 million in liabilities. Further details about the company's debts will be released in the next few days.

Cabi, the U.S. subsidiary of GICSA, one of the largest real estate developers in Mexico, had a $256 million loan with Bank of America, which had been extended. As of June 30, the developer had sold 75 units in the twin-tower complex at 244 Biscayne Blvd. for a total of $31 million, according to Condo Vultures.

Marc Kasowitz, an attorney with New York-based Kasowitz, Benson, Torres & Friedman, lead attorneys in Cabi's bankruptcy, said the company had no choice but to file because its lenders, which include Bank of America, HSBC, Comerica and Nord LB, would not allow the company to sufficiently reduce pricing.

"Cabi's view is that if the banks had acted reasonable in granting consents to drop the price of condo units to meet new market realities, then there could have been productive sales," Kasowitz said. "The banks' loans could have been continued to be serviced and the development would have proceeded well."