ROCKY ROAD: Lamar Crossing, the 120-unit multifamily property at Lamar and Dunn avenues near Interstate 240, has had a tumultuous existence. -- PHOTO BY ERIC SMITH

Lamar Crossing’s long and winding road might finally be coming to an end, parties close to the beleaguered property said last week. But some legal wranglings still need to be worked out before the unfinished multifamily complex sees its first resident.

The vacant property began with such promise but sputtered when the developer, Horizon Financial Group, operating as Lamar Crossing Apartments LP, defaulted on an $8.1 million construction loan and faced a host of liens from the general contractor and subcontractors.

Now owned by Arvest Bank of Oklahoma, which foreclosed on the property during the summer, Lamar Crossing has some interested buyers, said Donald Bourland, the attorney at Bourland, Heflin, Alvarez, Minor & Matthews PLC who has served as substitute trustee for Lamar Crossing since June 16.

Bourland, speaking on behalf of Arvest, said the bank had no specific listing price, but it is actively seeking a buyer who can complete the property, on the southeast side of Lamar and Dunn avenues, and begin leasing it quickly.

“They’re talking to some people,” Bourland said. “We’ve got some interest shown. We’re not in a position to divulge who that is. But we do have some interest in it and they’re going to be moving ahead on it.”

Close to complete

Moving ahead on finding a suitable buyer for Lamar Crossing would bring 120 apartment units to an area of Memphis that could use some new multifamily housing. The complex sits on 7.13 acres along Lamar just north of Interstate 240. Its address is listed by the Shelby County Register of Deeds as 2881 Lamar Ave., but by the Shelby County Assessor of Property as 2010 Meadowlark Run Drive.

Bourland said whatever buyer emerges will be charged with finishing the complex, estimated to be about 85 percent complete after construction stalled last year. Horizon principal Preston Byrd blamed the woes on construction overruns from soil problems as well as a complex equity issue with another lender.

But those problems are being contended by Patton & Taylor Enterprises LLC, the general contractor that is suing Horizon, Arvest and Bank of New York for about $3 million for work that has been performed and materials that have been supplied but never paid for. There also are charges of misallocating funds

Patton & Taylor principal Cameron Taylor declined to comment on the pending litigation, but he did provide an update of the building’s construction progress. Taylor said Patton and Taylor hasn’t worked on the property since May 2008 and agreed that Lamar Crossing is about 85 percent finished, with units in various stages of completion. Some of the buildings need appliances and some need drywall.

Taylor said it would be hard to estimate the cost of finishing the building because it has been sitting idle for a year and he didn’t know the current condition of the property, but he offered a ballpark figure of a “couple of million dollars.”

Needed for the area

As Bourland noted, because the property has been sitting vacant for almost a year with no activity and no progress, the completion percentage might have changed. In other words, there might be work that has to be redone because the property hasn’t received any maintenance during that period.

The bank will not schedule any work on the building until it finds a suitable buyer. If no buyer emerges, then the bank would consider completing the work needed to open the property to a tenant base.

“If there wasn’t anyone out there to sell it to, then they would decide how to proceed forward,” Bourland said. “But right now the process is to determining if there are some buyers for the property, and there are. We may have something to announce relatively soon, within the next couple of weeks, we’d like to think.”

Bourland said the bank is looking to sell Lamar Crossing “not only from a financial standpoint,” but also to complete the project “for the city of Memphis as well, which is badly needed.”

Lamar Crossing’s saga began when Horizon broke ground on the development in May 2007 – before the economy tanked and devastated numerous real estate developments. The property’s developer even secured multifamily housing revenue bonds under the Shelby County Health, Educational and Housing Facility Board, but they were withdrawn when Horizon became mired in legal and financial woes.

The 120,000-square-foot complex, which now has a chain-link fence around its perimeter, was going to be the anchor of a massive rejuvenation along that stretch of Lamar. Aldi Inc. opened a store on 2.5 acres that serves as an outparcel of the apartment complex. And across the street, a Chattanooga, Tenn.-based company called KRT Development redeveloped the vacant land at 2930 Lamar – formerly Cherokee Lanes bowling alley – into a retail strip center that has performed well considering the bleak financial climate.