Houston-based real estate developer Medistar Corp. is facing a lawsuit and potential foreclosure involving its developments and properties in or near the Texas Medical Center.
Medistar defaulted on $135.8M worth of construction financing for a student housing tower and parking garage at the Texas A&M Innovation Plaza at Texas Medical Center. Meanwhile, it has drawn the ire of an investment partner for trying to sell a 20-acre development site about 2 miles away, public documents show.
:quality(75))
BCEGI, a subsidiary of Beijing Construction Engineering Group, sued Medistar, alleging that it tried to sell the 20.4-acre site at 7171 Grand Blvd. in Houston without its consent, The Real Deal reported. The groups purchased the land together in 2017 but fell out of sync after a deal with a homebuilder fell through this month.
The joint venture planned to sell the land to Houston homebuilder City Choice for $22.5M, but City Choice terminated the deal on July 1 after citing issues with the land and asking for an extended deadline, the lawsuit states.
BCEGI later discovered that Medistar and City Choice were attempting to move forward with the deal anyway, according to the lawsuit. A state court temporarily blocked the sale, TRD reported, and the case is now in federal court.
Adding to the company's troubles, CIM Real Estate Credit LLC filed notices indicating it intends to foreclose on property tied to $135.8M of financing issued in 2021. The loans funded Medistar Corp.’s construction of a 714-bed student housing complex called Life Tower and a parking garage at Texas A&M Innovation Plaza, according to a report from Multi-Housing News.
Medistar TMC Garage LLC defaulted on the two loans, one for $59.3M and the other for $76.5M, the filings state. CIM plans to sell the property at the Harris County foreclosure auction Aug. 6, though a foreclosure filing does not ensure a property will be auctioned on that date.
The 19-story Life Tower is part of the 5-acre Texas A&M Innovation Plaza, a mixed-use campus with three towers including EnMed Tower, an 18-story, 28K SF academic building anchored by the university’s engineering-medicine program, and the 30-story Horizon Tower, which includes 17 floors of life sciences, restaurants, retail and parking. The development is along Holcombe Boulevard between Main and Fannin streets.
Life Tower opened in 2022. The Rice Thresher reported that students almost immediately began venting frustrations about the state of their units upon move-in.
Medistar and CIM did not return requests for comment for this article.
)
)
)
)
)
)
)
)
)
)
)
)