Business

Visions of Crabtree tower end with foreclosure sale

Posted May 11, 2011 3:38 p.m. EDT
Updated May 11, 2011 7:14 p.m. EDT

— Five years after a Sheraton Hotel came crashing down to make way for what developers said would be Raleigh's tallest building, visions of a mixed-use tower near Crabtree Valley Mall have likewise crumbled.

The 5-acre property on Glenwood Avenue that was to be occupied by the Soleil Center went on the auction block Wednesday, a month after a judge cleared the way for a foreclosure sale.

RL Regi Financial LLC, the group that bought the note on the property from Regions Bank, submitted the only bid at the auction. Other bidders have 10 days to top the $4.2 million offer, and their bids must be at least 5 percent higher to gain control of the property.

"I think it's very disappointing to everybody around there," said Mac Jones, a real estate broker who represents a family that owns an adjacent property. "(The Soleil Center) would have been difficult in a good time, but it's not going to work in a bad time, and this is a bad time."

Raleigh officials approved plans in 2005 for the 43-story building, which developers said would combine upscale condominiums, a spa and a Westin hotel.

After a concrete slab was poured for the building's foundation, all work stopped as the economy stalled and prospects for loans to pay for commercial building projects evaporated.

Developers Dicky Walia and Sanjay Mundra, who bought the property in 2003 for $5.7 million wound up owing Regions Bank and contractors $6.9 million on the project, according to court records.

"This one was going to be a key building in one of our emerging growth centers – Crabtree Valley," Raleigh Planning Director Mitchell Silver said.

Silver and others said they hope a more modest version of the project will eventually grace the Glenwood Avenue spot.

"We would still like to see a major building at that location, probably in the neighborhood of 20 stories. They can go higher if they go to City Council," Silver said.