Bank seeks $9.5M from Tucson condo project

TUCSON — A group of California investors intent on converting apartments into condominiums walked out on a $12.6 million loan and is keeping the rent from the units in the meantime, according to a recent complaint.

Texas-based Comerica Bank filed suit against Pantano Coastal LLC and its main principal, Ralph Giannella of La Jolla, Calif., who had received the loan to upgrade and convert 136 apartments near the corner of Broadway and Pantano roads.

It’s the latest sign of the Arizona real estate debacle, which has led to a record number of mechanic liens, loan defaults and foreclosures.

According to the 32-page complaint, Comerica agreed to loan Pantano Coastal money in March 2006. To secure repayment of the loan, Pantano pledged the entire property and its rents as colateral.

But as the real estate scene soured, so did the financial outlook for the condo-conversion project. The maturity date of the loan was extended 90 days until December 2007, and other parts of the deal were tweaked, according to the complaint.

But after the maturity date came and went, Pantano Coastal had yet to make a single payment on the loan, the complaint claims. Any missed payments were subject to a 5 percent charge.

Comerica claims the company also withheld rent monies at the time and did not pay almost $60,000 in property taxes that were due for the site. It is upset because this impairs the bank’s security for the loan.

By the Comerica’s math, Pantano Coastal now owes $9.5 million on the project. It is asking a federal judge in Tucson to rule against the company and foreclose on the property to bring it under bank control.

Phoenix lawyers Mark Nadeau and Allison Harvey are representing Comerica Bank.

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