Forman Capital has initiated foreclosure proceedings on a development site in Miami’s Art & Entertainment District, citing an alleged $8.3 million loan default. The site, located at 1317-1352 North Miami Avenue, was intended for a 30-story condo-hotel project.
The lawsuit was filed on September 5 by an affiliate of Delray Beach-based Forman Capital, led by Brett Forman and Ben Jacobson. The complaint targets two entities that own the half-acre assemblage and alleges default on a bridge loan that matured August 16. In addition to the principal, Forman Capital is seeking about $220,000 in default interest and fees.
A spokesperson for Forman Capital declined to comment on the ongoing litigation. Joseph Pardo, attorney for the borrowers, said his clients are working toward a resolution with the lender. “This project is transitioning from a land loan to a construction loan, and this is a timing issue,” Pardo said. “We are in active negotiations with the lender to resolve this, and we fully expect that it will be resolved promptly.”
Developer Dan Kodsi was previously managing the project but is no longer involved, according to statements from both Kodsi and Pardo.
Records show that last year Forman Capital provided the loan to refinance an earlier mortgage on the property. The entities paid $10.7 million for the assemblage in 2022 and are currently collaborating with city officials to finalize design plans and permitted density.
Earlier plans by Kodsi and former partner Rafael Pecchio called for a 200-unit apartment building before shifting last year to new plans for a condo-hotel featuring 360 units with some designated as short-term rentals after Pecchio left the partnership.
Kodsi is also engaged in separate legal action over his Legacy Hotel & Residences project at Miami Worldcenter, which remains under construction. In July, Monarch Alternative Capital filed foreclosure proceedings related to more than $35 million owed on that partially built tower at 942 Northeast First Avenue in downtown Miami; Kodsi’s entity has countersued Monarch over those claims.
This story has been updated to reflect statements from Dan Kodsi and his attorney confirming he is no longer involved with the Art & Entertainment District project.
