Citizens Bank foreclosing on Hidden Ridge loan: Lender files suit to force partners to pay
TRAVERSE CITY – Citizens Bank has filed suit to foreclose on a $1.5 million loan to Hidden Ridge Development LLC, the developer of a roughly 30-lot residential project along East Shore Drive in the southeast corner of Peninsula Township.
The bank wants to be repaid its original loan principal, plus interest, costs and attorney's fees, bringing the total owed to more than $1.6 million, the lawsuit said.
The corporation hasn't paid quarterly interest since June 6, 2006, the bank's attorney, Dennis Haley of Grand Blanc, wrote in his complaint.
He charged that Hidden Ridge failed to make its principal payments of nearly $270,000 in December 2005 and June 2006. The bank loaned the money to the corporation on Jan. 3, 2005.
Joseph Zimmers, a Hidden Ridge principal, formed the corporation in 2001. The 26-acre project won approval from township trustees that same year, overcoming opposition from the planning commission and some residents. They cited possible erosion and drainage problems.
Several years ago, the company and its then broker, Jim Noller Properties, were promoting it with fanfare, describing its "beautiful bay view" and "private, pristine lots." Coldwell Banker Schmidt is currently listing the properties, advertising their municipal water and sewer and deeded access to East Bay as selling points.
But about half the lots are still on the market six years after the project was approved, selling for $99,900 to $139,900 per parcel. That puts them among the most expensive small lots in the Coldwell Banker listings for the Peninsula Township and East Bay areas. They range from about half an acre to a full acre, according to Hidden Ridge marketing materials.
To sweeten the deals, Coldwell Banker had been offering free excavating services worth about $20,000 for the first four lots sold through mid-February.
In the lawsuit, the bank now contends that Zimmers and three other partners in the project owe the $1.6 million.
"Each has an absolute, unconditional and unlimited guarantee of indebtedness," Haley wrote.
Neither Zimmers nor Hidden Ridge's attorney, Fred Bimber, could be reached for comment. BN