KVIG Informative

The Watermark was supposed to anchor downtown Henderson’s Water Street district. Instead, its original developer lost the building to foreclosure with more than $41.5 million in unpaid debt still on the books.

Southern California landlord Next Wave Investors acquired The Watermark, a mixed-use apartment and commercial building in downtown Henderson, this spring after a construction lender cleared the way for foreclosure, according to property records, business-entity filings and court records.

The building went into foreclosure in late April with more than $41.5 million in unpaid debt and other costs outstanding at the time, according to Clark County records. A notice of trustee’s sale had been recorded with the county in January, scheduling a foreclosure auction for the property.

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The Watermark’s original developer, Strada Development Group, operated the project through an entity called DTH 215 Venture LLC, which filed for bankruptcy in June. The roughly $50 million project was designed to include 151 apartments, more than 25,500 square feet of restaurant space and 12,500 square feet of office space in Henderson’s Water Street District.

Court records show the developer finished construction but was unable to lease the commercial space as quickly as anticipated, and ultimately couldn’t sell or refinance the property to pay off its lender. Tom Wucherer, founding partner of Strada Development Group, did not respond to requests for comment, and project lender Acres Capital also did not respond.

Contractor Gillett, named in related litigation, stated in a court filing that it was contractually obligated to follow approved drawings for the project and had “meticulously adhered” to them and the owner’s directives, arguing that any assertions of poor workmanship are “fundamentally misplaced” and that delays stemmed from issues with the drawings themselves, not its work.

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Next Wave co-founder David Sloan said in a phone interview that The Watermark’s apartments are now just over 70% leased under the new ownership.

The Watermark’s apartments are filling up. The $41.5 million in debt that sank its original developer isn’t the new owner’s problem to solve — it’s already been settled through foreclosure, leaving Next Wave with a building nearly three-quarters leased and none of the financial wreckage that got it there.