Once a low-income housing complex built in the 1960s, it became the subject of a decade long court battle for ownership of the property.
In 2005, 206 mainly elderly investors pitched in $25,000, $50,000 or $100,000 worth of life savings to a real estate syndicator who loaned $16 million to a condo developer to build Sail Club Clear Lake in place of the low-income apartment complex. The Sail Club was to include 590 residences comprised of high-rise condominiums, townhouses, and lofts.
Just a few months later, the economy collapsed in the Great Recession. Though they had pre-sold 110 condos, it wasn’t enough to qualify for a construction loan so deposits were returned to the buyers. The demolition of the original low-income apartments was put on hold.
The syndicator to whom the developer owed roughly $16 million, USA Commercial Mortgage Co., filed for Chapter 11 bankruptcy in 2006, following a Securities and Exchange Commission investigation of how the lender and its affiliates financed construction projects. The bankruptcy filing left the investors with no West Palm Beach project and a protracted court battle to gain control of the property.
During this time, the buildings were heavily neglected. Mostly just empty shells, the buildings were covered in graffiti, piles of trash littered the property, and homeless people could be found squatting inside the buildings. This lead the City of West Palm Beach to declare it a chronic nuisance.
Finally in 2015, the investors regained control of the property after a 10-year battle in bankruptcy court.
In December 2015, the city’s most prolific land-buyer and developer Jeff Greene, bought the 11-acre site for $12.5 million with plans to building condominiums on the property. Demolition of the old low-income housing buildings began in February 2016.