The Rhythm Sues Cash Strapped Buyers

This article entitled “Rhythm developer latest to sue would-be buyers” appeared in the Nashville Business Journal on June 30th, 2009. The writer is Turner Hutchens:

The Rhythm at Music Row has become the latest new Middle Tennessee condo development to sue buyers who try to back out of their purchases.

Rhythm Partners LLC, the Brentwood-based developer of the 14-story, 105-unit condo building that came online this spring, filed suit Friday against four buyers who would not or could not close on their units.

The suits, filed in Davidson County Chancery Court, accuse the buyers of violating the terms of their contracts and ask for the developer to be awarded the full purchase price of the units, plus legal costs. The units range in price from $317,000 to $539,000.

The sour economy, tight lending conditions for buyers and a glut of new condos coming onto the market in the past year have combined to slow sales and create financial headaches for condo developers.

There are legal conflicts with reluctant buyers at several Nashville-area high-rise residential developments.

Bristol Development has filed suit against buyers who pulled out of purchasing units at the Bristol West End in Midtown Nashville. Jamison Station in Franklin has successfully forced buyers to the closing table with suits against them.

Icon in the Gulch, a joint venture of Bristol Development and Marketstreet Enterprises, is also the defendant in several suits by buyers who signed contracts on units there, but claim the developers were deceptive in their promises and their dealings regarding the development.

Terrazzo in the Gulchhas also been sued by buyers claiming they were misled and that information was not disclosed properly. Terrazzo’s developer is Crosland Tennessee.

Several local condo developments have been put into receivership by lenders. They include the Braxton in Ashland City, 5th & Main in East Nashville and Rolling Mill Hill in downtown Nashville.”

I have not had an opportunity to wrap my mind around this news, but it should be noted that I represent 2 of the 4 buyers being sued in the Rhythm and that I am also a contracted purchaser of a $500,000 condo in the building.