Thursday, February 14, 2008

BankUnited's Blacklist

The South Florida Business Journal is reporting that BankUnited has blacklisted some condo projects:

Interested buyers looking for mortgages to buy units in Miami's Opera Tower, Everglades on the Bay or Four Ambassadors shouldn't bother approaching BankUnited. The Miami-based bank has included them on a list of 191 condo projects it won't write loans for.

The Business Journal obtained a list of "non-permissible" projects used internally at BankUnited (NASDAQ: BKUNA) and updated as of Jan. 14. Most of the forbidden properties were in Miami and were added at the last update. It wasn't clear who at the bank wrote the list, but the author stated a reason for almost every project declared off-limits.

If BankUnited won't lend on condos in these projects and other lenders follow suit, these projects will likely fail. Banks that lent to developers on these projects are about to own some condo towers. Its just another step toward the bottom of this market. This happened in the 80s as well and there were bargains for years. It'll probably take even longer this time.

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