As of last month, the loans on both the Vestavia Hills City Center and Patton Creek center in Hoover had matured, and the banks holding the loans assigned them to other companies, according to the Birmingham Business Journal.
Both retail properties were owned by Alex Baker, CEO of AIG Baker Vestavia, LLC, a subsidiary of the troubled AIG Baker who was the recipient of a large government bail-out last year.
Presently, the loan on Vestavia Hills City Center is owned by Huntsville firm Propst Properites, which is headed up by John Hughey. Patton’s Creek’s loan is held by Tate Capital Real Estate Solutions, LLC of Miami.
Hughey, of Propst Properties, felt the property was a good investment and intended to hold a foreclosure sale on April 27 of last month. Days before the sale, Baker put the property into bankruptcy to stave off the sale, according to al.com.
Baker wants a chance to repay his debt on the property and maintain the development. He is also ending his 17-year relationship with the larger AIG entity. Lawsuits continue, as Baker challenges the legality of a bank selling a loan to an entity other than another bank or financial establishment.
However, according to al.com, Hughey remains “unfazed” by these recent developments and potential legal snares. In an online article, he is quoted as saying “’We’ve got legal rights, too … Our legal counsel says we’re in a pretty good position.’”
Again according to the Birmingham Business Journal, Tate Capital intended to put Patton Creek in foreclosure sale on May 11 of last week.
AIG’s other Birmingham properties include the Village at Lee Branch and Wildwood Centre. The Journal also says that the company already defaulted “on a $10.4 million construction loan” that would have established Hayes Marketplace, a proposed Pelham shopping center.
Business amongst the individual retailers should remain relatively unchanged in coming months, but it remains to be seen who will own what properties once the dust settles.