A lender for the unfinished Mandarin Oriental condominium in Boca Raton will not be able to seize and sell collateral for the project's $418 million loan, a New York state court ruled on Oct. 1.
The decision puts on hold, for now, any potential that the Mandarin Oriental's developer, Penn Florida Cos., could lose control of the planned luxury condo in the heart of downtown Boca Raton. The 88-unit tower is at 105 E. Camino Real, part of the $1.5 billion Via Mizner complex.
However, the New York lawsuit, which was filed by Penn Florida against its lender, does raise fresh questions on another issue: Will the project remain a branded Mandarin Oriental project?
On Aug. 13, 2025, a Mandarin Oriental lawyer told Penn Florida that the company was ending
its branding of the condo and hotel, according to a letter attached as an exhibit in the New York case. The letter cited Penn-Florida's failure to open the hotel by Nov. 30, 2024, and pay the Mandarin Oriental fees for the condo and hotel.
In an Oct. 1 interview, Penn-Florida lawyer Stephen Meister said the arrangement with Mandarin Oriental "has not been effectively terminated yet. It’s still intact, despite that letter."
"Our agreement with the Mandarin Oriental remains in place today. We cannot comment any further," said Elizabeth Cross, vice president of marketing for Penn-Florida.
A Mandarin Oriental spokesperson did not respond to an email seeking comment.
Developer, lender in legal battles spanning two states
A decade ago, when the Via Mizner project featuring the luxury Mandarin Oriental was first announced, it was said the 2.3 million-square-foot complex would create an "urban oasis" in Boca Raton. The hotel group is known for posh services and designs.
The three-building complex would feature an apartment building, a hotel and a condo at the northeast corner of Federal Highway and Camino Real.
The apartment tower was built, but the hotel and condo towers have been beset by construction stops and financial issues during seven years of construction.
In December 2025, a Penn Florida affiliate that owns the unfinished hotel tower filed for Chapter 11 bankruptcy reorganization.
Then came a July 17 foreclosure lawsuit in Palm Beach County Circuit Court by Penn Florida's lender on the condo tower. The lender, an affiliate of Madison Realty Capital, sued over the $418 million construction loan.
But in its New York state lawsuit, Via Mizner Owner III LLC, the Penn Florida affiliate that owns the condo, fought back against the foreclosure.
The Boca Raton-based developer said Madison Capital refused to fund a loan fully, then demanded control of the Mandarin Oriental condo's construction.
The result was disastrous, Penn Florida alleged in its complaint.
"Gross mismanagement" of the condo's construction ensued, resulting in unpaid contractors filing $44 million worth of liens, according to the lawsuit.
A consulting firm official overseeing the condo's construction even was instructed by a Madison representative to "crush the project," the lawsuit alleged.
As part of its efforts to seize the Penn Florida project, court records show that Madison Capital had wanted to take control of the loan's collateral, which consists of shares in the company that owns the project.
But in an Oct. 1 hearing, Penn Florida successfully thwarted that effort for now, Meister said.
Will Mandarin Oriental buyers stay if the brand goes away?
A lot of money is at stake with this project, and not just for the lender.
More than 90 would-be buyers have signed pre-construction contracts for units in the Mandarin Oriental Residences, with total sales volume exceeding $325 million. Condo prices range from $2 million to about $23 million per unit.
The Boca Raton condo and hotel development is not affiliated with a Mandarin Oriental condominium planned in West Palm Beach by Great Gulf, a Canada-based developer.
On Aug. 19, Penn Florida's Cross said the Boca Raton Mandarin Oriental condo is nearly completed with about eight months needed to finish "once construction resumes full speed."
Given the project's financial troubles, legal experts said it's not clear when that will happen. And not everyone wants to wait around to see if it happens, either.
For the past two years, some buyers have sued to recoup deposits ranging from hundreds of thousands of dollars to millions of dollars. Their lawsuits allege the condo was not finished by promised deadlines.
Several buyers are being represented by James Ferrara, the attorney who filed the first buyer lawsuit against Penn Florida in 2024. Some buyers have recouped their deposits. Others have cases that remain in litigation, court records show.
In a Sept. 30 interview, Ferrara said most buyers have remained loyal to the Mandarin Oriental project because its luxury brand is so valuable. However, if the Mandarin Oriental exited the project, as the purchase contracts allow, Ferrara predicted more buyers could seek to recoup their deposits.
Mold, water damage at unfinished condo, developer says
It's also not clear what the condition of the condo tower will be like if it is eventually finished.
In its lawsuit, Penn Florida lawsuit painted a grim picture of its own project. Work on the Mandarin Oriental condo tower has stopped, the developer said its complaint, and Madison Capital has allowed water and mold damage to injure the property.
Since there's no money coming in, the property isn't being guarded by security, "leaving the project exposed to trespass, vandalism, liability, and theft," Penn Florida's lawsuit said.
An attorney representing Madison Capital has said he could not comment on the case.
Alexandra Clough is a business writer at The Palm Beach Post. You can reach her at aclough@pbpost.com. X: @acloughpbp. Help support our journalism. Subscribe today.
This article originally appeared on Palm Beach Post: Will Mandarin Oriental hotel brand remain at Boca condo? | Exclusive
