Liberty Harbor was an ambitious planned multi-use project
along the Inter-Coastal Waterway in Brunswick, Georgia. Its developers suggested that it would be a
$2 billion project when completed. Like
all real estate projects, recent financial conditions have had an adverse
effect and a January 12, 2009 article in the Jacksonville Times-Union quoted
its spokesman, Paul Levine, to say “We’re just basically waiting out the
Liberty Harbor was to include an hotel, townhouses, single
family houses and condominiums. To date,
only one structure has been built on the project, a waterfront home. Levine suggested to the Times-Union reporter
that construction would soon start on two condominiums, half of which he
suggested were already sold. That was
January, 2009. No condominiums have ever
Indeed Liberty Harbor had Agreements involving a number of
condominium units for which it took deposits.
The Agreements required the purchasers to place an earnest money deposit
equal to ten percent (10%) of the purchase price in escrow with the expectation
that an additional earnest money deposit of ten percent (10%) would be due
“within ten (10) days after Purchaser receives notice from Seller that
construction of the Condominium has commenced.”
In August and September, 2008 and again in January, 2009, the developer sent
notices to certain purchasers suggesting that “construction of the Condominium has
commenced” and that the additional deposit was due. When certain purchasers declined to send
deposits on the basis that there was, in fact, no construction activity, the
developer notified them that they were in breach of contract.
In addition, all contracts required closing of the units to
occur not later than December 31, 2010.
That date has now passed and not a single unit has been built. Now the developer suggests that he be allowed
an additional two years to complete the project as “force majeure” has
prevented it from obtaining “services and materials.”
For those of us with more than a passing memory of past real
estate crashes, it seems highly unlikely that financing for this project will ever
be found by this developer. Many of the
lots that the principals owned have been sold for back taxes. The lots on which the condominiums were to be
built were saved from tax sales by last minute tax payments. Nonetheless, the developer stands ready to “modify”
the existing contracts as it has plans to complete the project. If you believe that one, I have a bridge I’d
like to sell you.
The Sturgeon Law Firm represents several individuals who
made deposits for the purchase of Liberty Harbor condominium units. If you made a deposit for the purchase of one
of these units in this phantom construction project, and would like us to
review your options, please contact us.