Buyer gives troubled Tempe towers new name, new life - East Valley Tribune: Ahwatukee Foothills

Buyer gives troubled Tempe towers new name, new life

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Posted: Tuesday, February 22, 2011 4:16 pm | Updated: 1:37 pm, Wed Oct 10, 2012.

The Centerpoint Condominiums towers will come to life this summer, three years after the East Valley's tallest buildings were supposed to welcome their first residents.

And after being a symbol of Arizona's real estate crash, the downtown Tempe towers have been renamed West Sixth.

The Ohio-based Zaremba Group expects to open the 22-story tower this summer as luxury rentals that attract university students and young professionals. The 30-floor tower should debut in December.

Zaremba closed the $30 million deal Friday after a false start last year that raised fears a legal and financial cloud could hang over the property for years. But the development's potential lured more than 500 prospective buyers into contacting owner ML Manager about a sale.

"Some would say it's a monument of what happened in the real estate market, but there were no shortage of people who were interested in buying it," ML Manager CEO Mark Winkleman said. "It's not a project that didn't have a place. With the right pricing, it will be very attractive."

Original owner Tempe Land Company started work in 2005 but work stopped in 2008 when its main lender, Mortgages Ltd., filed for bankruptcy. The shorter tower was nearly complete, with only common areas yet to be finished. The other tower is half done. It will likely cost $40 million to complete the work, Winkleman said.

He dismissed news reports that summertime heat had ruined the interiors.

"I think everybody we toured through was surprised at the lack of apparent damage," Winkleman said. "There appeared to be very little damage from the heat."

Zaremba said the first tower will open in August along with shops and restaurants on the ground floor. The company has not set prices yet but said they should be similar to other area rentals. Zaremba chose the West Sixth name to reflect the address, 111 W. 6th St.

Zaremba's first attempt unraveled two days before the sale was to close in October. The title company initially said a buyer wouldn't assume $20 million in contractor liens, only to reverse its position. ML Manager decided to buy the liens for "several million," Winkleman said, and pursue them to recover its expenses.

In addition to contractors, more than 1,000 investors lost money they had invested in Mortgages Ltd. The company had loaned $125 million to Centerpoint's developer.

The Centerpoint sale is one of about 50 Mortgages Ltd. projects to be auctioned by ML Manager. It stands out as more than the most costly and high-profile development swept up in the lender's collapse, Winkleman said.

"I've seen a lot of deals but this one was the most complicated, prolonged and contentious of any deal I was ever involved with that ever got consummated," Winkleman said.

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