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Date of Issue: March 09, 2006

Villa not so rosy: Partner sues partners

GSR Villa Rosa Pic
A rose by any other name
The model home at the Villa Rosa subdivision in Anna Maria is just about ready and is included in the upcoming 2006 Parade of Homes on Anna Maria Island. Islander Photo: Rick Catlin

Those visions of million-dollar luxury homes at the Villa Rosa subdivision on South Bay Drive in Anna Maria - along with building permit fees and ad valorem taxes for the city treasury - may have to be put on hold for the near future, perhaps even longer, until a current legal challenge is resolved.

New Jersey resident Ed Furfey, claiming he is an equal partner with Robert Byrne and Steve Noriega in GSR Development LLC, the Villa Rosa developers, has sued his partners for an unspecified amount, alleging - among a number of accusations - that he was not given first right of refusal when Byrne and Noriega sold 2.56 acres of the Villa Rosa property last year.

Furfey filed suit in Manatee County Circuit Court Feb. 17, claiming that the $6.4 million sale of the Villa Rosa property last August to Bon Eau Enterprises LLC of Sarasota was "well below market value" for the 2.56 acres.

The lawsuit alleges Furfey was "unaware of the sale and transfer of the Villa Rosa property at the time they occurred," was not given the "right of first refusal," which would have allowed him to purchase the property for that amount, and was not given a copy of the sale agreement by Byrne and Noriega.

The lawsuit, filed on behalf of Furfey by attorney Charles Sniffen of the law firm of Harllee and Bald, alleged that Byrne and Noriega are guilty of breach of contract, breach of fiduciary trust, breach of duties of loyalty and care and a charge of equitable accounting.

In the last count, Furfey alleges that Byrne and Noriega made a $100,000 "members draw" on Sept. 30, 2005, that was attributed to Furfey, but Furfey claims he "made no such draw, nor otherwise received the $100,000." He also alleged that GSR records "reflect inappropriate cash distributions to members Byrne and Noriega" that he was "unaware of and/or did not approve."

Additionally, Furfey alleges that GSR Development has "borrowed extensively" to finance its operations, including the execution of numerous promissory notes and mortgages. He also claims that GSR Development’s Sept. 30, 2005, balance sheet contains "entries for tangible assets" that do not belong to GSR, including property at 502 S. Bay Blvd. in Anna Maria and 518 Key Royale Drive in Holmes Beach.

Byrne and Noriega have "consistently failed to adequately maintain the books and records" of GSR, alleged Furfey, and his demands for records on the sale of the property to Bon Eau "have failed to produce essential recordings relating to the Villa Rosa transaction," the lawsuit alleges.

Furfey demanded a trial by jury on all the issues, claiming he has been "damaged" by the actions of Byrne and Noriega. Furfey sought no specific amount in the initial lawsuit, but asks for "relief as this court may deem appropriate."

Efforts to reach Noriega for comment on the lawsuit were unsuccessful.

Bon Eau Enterprises LLC is registered with the Sarasota law firm of Nelson Hesse. The company is owned by Randall Bono, a retired lawyer from Illinois who now lives in Osprey, Fla.

 

Long-time, few roses for GSR

The Villa Rosa subdivision in Anna Maria was first proposed by Robert Byrne and Steve Noriega of GSR Development LLC in April 2002. GSR had paid the Lardas family about $2 million for 3.85 acres of undeveloped canalfront property on South Bay Boulevard.

At the time GSR made its site plan presentation to the city commission, the company said it planned to build 17 single-family homes in a gated community with a maximum lot size per house of just under 8,600 square feet.

Following several stormy meetings on the project, the Anna Maria City Commission approved the site plan on July 7, 2002, after several lawyers representing GSR threatened the city with legal action if the plan were denied.

GSR representatives said a final site plan allowing lot sales to begin would be delivered to the commission within six months, but the commission has been waiting nearly four years for the final plan.

The company was allowed to construct a model home on the property. The house has been under construction for about two years and is included in the 2006 Parade of Homes.

The GSR site plan submission did result in the city establishing procedures and guidelines for site plan submission of major and minor construction projects, although city officials at the time admitted that Villa Rosa was likely the last major parcel of undeveloped land in the city.

Real estate agents in 2002 estimated the value of each home in Villa Rosa would be about $1 million, but given the Island’s rising property values the past four years, that figure was recently revised by Noriega to a minimum of $2 million per house, if not higher. That would make the Villa Rosa project worth about $34 million on buildout.

One agent said vacant lots in the subdivision should be worth between $800,000 to $1 million. The 2.56 acres would amount to approximately 12 to 13 lots, the agent said.

GSR Development was also scheduled to develop the Rosa del Mar condominium project on Gulf Drive Bradenton Beach, but lost its building permit after the city determined that no activity had taken place on the property during the prescribed period. The lot has been vacant for nearly two years.