Several Lauren Condominiums Sold at Foreclosure Auction
Bethesda building’s developers facing lawsuits alleging ‘defective construction’ and failure to pay marketers
Bethesda Beat Staff Photo
Several units at the high-end The Lauren Residences condominiums have been sold in a foreclosure auction and the developers of the Bethesda property are facing a pair of separate lawsuits claiming they misrepresented the quality of the units and failed to pay for marketing services.
After three years of attempting to break through a Bethesda residential real estate market that the Lauren’s developers said has “underperformed,” 11 units at The Lauren were sold at a foreclosure auction earlier this year.
The final ratification of the sale was Tuesday, according to online court records, although it was not immediately clear who bought the properties or the sale prices.
Representatives for EagleBank, The Lauren’s lender, declined comment.
Court filings in a separate legal case say ownership of The Lauren went to EagleBank and the Bethesda-based bank then made a sale to an unidentified “third party buyer.”
The Lauren, promoted as some of the most luxurious – and expensive – condominiums in the Washington region, opened in 2016 with 29 units ranging from 1,444- to -3,500-square-feet, priced between $1 million and $5 million. The seven-story building on Hampden Lane also includes a 7,300-square-foot, $10.5 million penthouse.
Some units include maid suites, private elevators, salons and private terraces. The target buyers were “well-traveled 50+ year old couples” according to a post on one of the developers’ websites.
The Lauren’s website now says it is “private” and is inaccessible to the public.
In a statement, a publicist for the building’s developers said they are proud of the project and more than 70 percent of the units are sold, but a sluggish economy has dampened demand for luxury condominiums in the Bethesda area.
Bethesda-based 1788 Holdings and Washington D.C.-based Persimmon Capital Partners were developers for the project.
“The business plan for the development of the Lauren was predicated upon a significant recovery of the Potomac and Bethesda upper end housing market with strong buyer demand for urban, close-in luxury condominium residences which hasn’t occurred in the time frame expected,” a publicist for Lauren developers said in a statement issued Thursday. “The Potomac and Bethesda residential markets have underperformed over the past several years and maintain extremely depressed pricing relative to where housing prices were prior to the last recession resulting in limited absorption for all new condominium projects in these markets.”
Lauren representatives declined further comment.
In a separate case, the consulting firm McWilliams Ballard Inc. filed a lawsuit in federal district court last month alleging The Lauren owes the Virginia-based company more than $150,000 for its services marketing and selling individual condominium units.
“Lauren’s refusal to pay MB results from its gross mismanagement of the project and of funds that were supposed to be used to pay MB and other creditors of Lauren,” the lawsuit says. “As a direct result of this mismanagement, Lauren’s lender (Eagle Bank) foreclosed on The Lauren property and sold it to a third party on or about January 25, 2019.”
In an email to McWilliams Ballard included in court documents, Lauren representative Larry Goodwin said the foreclosure is “without a doubt no reflection on your efforts on our behalf,” and commended the work of Roger Cornell, who was known as the lead marketer and broker for The Lauren.
In a separate lawsuit filed in late March in Montgomery County Circuit Court, owners of units allege previous owners of The Lauren intentionally misrepresented the building’s condition, claiming it has “defective construction … including defects that present a substantial risk of personal injury.”
The five plaintiffs who filed 15 charges, including negligence, defective products, misrepresentation of facts and breach of contract, are seeking nearly $1 million in damages and a jury trial.
Condominium owners who filed the lawsuit allege the building does not meet building code standards, including inadequate fire prevention measures, improperly installed hand railings for the disabled and that placement of balcony supports over pedestrian walkways could accumulate ice that could fall on pedestrians.
They also claim they have been forced to conduct non-routine maintenance that property owners and developers assured would not be an issue in the 3-year-old building.
“The conduct, statements and representations … constitute unfair or deceptive trade practices,” the lawsuit asserts. “The omission of these facts is material since a significant number of unsophisticated consumers would attach importance to the information withheld in the determination of whether to purchase at the condominium.”
Caitlynn Peetz can be reached at firstname.lastname@example.org