2 Partnerships Involving Santa Margarita Co. Sued
In a sign of worsening troubles for the beleaguered Santa Margarita Co., First Interstate Bank has filed a foreclosure suit on two partnerships developing homes on its South County land.
Filed in Orange County Superior Court, the suit claims a partnership with Fieldstone Homes in Newport Beach failed to make a payment on a loan, of which only $5.6 million remains, for a $94-million project. The lender wants to foreclose on 89 housing lots in Rancho Santa Margarita, the developer’s master-planned community.
Rancho Trabuco Partners III, a partnership with Fieldstone, failed to make a $1-million principal payment due Sept. 30. The partnership bought the land in 1989.
A second partnership, Rancho Santa Margarita Joint Venture, allegedly failed to file a timely financial report and is being sued for the $1.8-million balance of its loan. Finally, Santa Margarita Co. is being sued to pay at least $1 million of the debt under a loan guarantee.
The beleaguered Santa Margarita Co. recently completed a major refinancing in an attempt to recover from its money woes. The company renegotiated several of its credit lines and got cash infusions from investors.
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