Luxury hotel and condo project in Hendersonville could be foreclosed
by Kimberly King
HENDERSONVILLE, N.C. (WLOS) — There are new developments on Fairmont Heritage Place The Cedars, the luxury hotel and condo complex project in downtown Hendersonville.
On Tuesday, Sept. 22, North Carolina Business Court Judge A. Graham Shirley, based in Raleigh, held a hearing involving the lender and defendant Cedars Lodge and Spa, LLC, and 719Nomain LLC, associated with the condo project called Fairmont Heritage Place The Cedars.
Judge Shirley will decide if the construction site, which has sat dormant since late 2025, should go into foreclosure or be sold. Attorneys for lender Fuse 10 said the developer defaulted on his loan of $36 million.
Shirley held Tuesday's hearing virtually. On top of the $36 million loan default, attorneys in the hearing said 66 condo buyers paid deposits of $18 million and haven't received any funds back. One buyer during the hearing told the judge that she thinks she may not get any of her money back.
The developer, Greg Covin, had ties to both Hendersonville and the Miami area. Attorneys said Fuse 10 would like to buy the site for $36 million, the amount of the loan default, and then try to resell it to another developer. A court-appointed receiver working to get the site sold is named Liberty Solutions. Attorney Anna Gorman spoke on behalf of the receiver.
"Clearly something went wrong during this construction process, and now we are very aware that there's kind of this mess that needs to be cleaned up," Gorman said. "Fuse is owed over 36 million dollars; it’s growing every day. Fuse hasn't been paid in months. I think the technical default dates to the end of 2025."
During the hearing, attorneys said there were eight parcels of land and that the plan was two 65-unit buildings. Gorman said the receivership was put in place to "deal with the property."
Buyers who put deposits down on future condos were not a direct party to Tuesday's hearing that involved only the developer and the loan company suing the defendant.
But attorney Paul Capua, who represents a number of buyers, was allowed to speak on behalf of his clients. Capua explained that buyers are not in favor of the $36 million sale proposal to Fuse, the lender, because it would bring no additional money to potentially get buyers some deposit money back.
Capua said financial deposit documents in the condo project show that deposits of some $18 million went directly into the project, which he said gives buyers the right to have a say under North Carolina law. Another option for the judge is to rule the project goes into foreclosure for defaulting on the loan.
Attorneys during the hearing said the loan balance of $36 million is accruing daily interest of $21,000, amounting to about $650,000 a month.
Judge Shirley said he wasn't making a decision Tuesday but was listening to the parties' arguments.
Another hearing is scheduled for Tuesday, Oct. 6. Mid-November is when the court has a deadline in the case for sale bids.
During the hearing Tuesday, attorneys told Judge Shirley that about 55% of the one condo building is complete, with an estimate of $40 million to finish the project.
The site has been a bone of contention for some residents who continue to question why leaders permitted zoning for the luxury project they feel doesn't fit in with Hendersonville.
But the property was privately owned, and those with knowledge of the project have previously told News 13 that approval of a privately funded development that meets city zoning and permit requirements typically can move forward.
During the hearing, attorneys said the developer has additional outstanding loans totaling over $18 million that include construction liens.
Gorman said Fuse does have the right to foreclose on the property but would prefer to purchase it.
An attorney for defendant Cedars Lodge and Spa LLC said his client has been cooperative throughout the court process and tried to get refinanced but failed.
Attorneys during the hearing said that in a situation like this, there are two options. One would be for a buyer to tear down the partially built condo building and start a new project on the site. The second option, attorneys argued, would be to find a builder who wants to complete the tower that’s sitting and sell the condos partially built.
The question remains, however, what the value of the property is with a partially built condo building and buyers who put deposits but have no units to show for it.
STORY COURTESY OF WLOS-TV13
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