Sureste Complaint
Sureste Complaint
YOU ARE HEREBY SUMMONED and required to answer the Complaint in this action,
a copy of which is hereby served upon you, and to serve a copy of your Answer to the said
Complaint upon the subscribers at 1320 Main Street, Post Office Box 11070, Columbia, South
Carolina 29211, within thirty (30) days after service hereof except as to the United States of
America, which shall have sixty (60) days, exclusive of the day of such service, and if you fail to
answer the Complaint within the time aforesaid, judgment by default will be rendered against
YOU WILL ALSO TAKE NOTICE that pursuant to Rule 53(b), of the South Carolina
Rules of Civil Procedure, as amended effective September 1, 2002, the Plaintiff will move for a
general Order of Reference to the Master in Equity for Lexington County, which Order shall,
ELECTRONICALLY FILED - 2024 Jul 02 1:58 PM - LEXINGTON - COMMON PLEAS - CASE#2024CP3202843
pursuant to Rule 53(b) of the SCRCP, specifically provide that the said Master in Equity is
show:
company formed under and pursuant to the laws of the State of Delaware and authorized to do
2. Upon information and belief, the Defendant Sureste Westwood, LLC ("Sureste
Westwood") is a limited liability company organized under and pursuant to the laws of the State
3. Upon information and belief, the Defendant Valley National Bank, N.A. is a
banking corporation organized and existing under and pursuant to the laws of the United States of
partnership organized and existed under and pursuant to the laws of the State of Delaware and
5. Upon information and belief, the Defendant Sureste Properties, LP, is a limited
partnership organized and existed under and pursuant to the laws of the State of Delaware and
6. Upon information and belief, the Defendant Steven Ross is a citizen and
7. Upon information and belief, the Defendant Noah Rosenfarb is a citizen and
8. Upon information and belief, the Defendant Henry Burkhalter is a citizen and
9. Upon information and belief, the Defendant Thomas Manglaviti, Jr. is a citizen
10. Upon information and belief, the Defendant Trinity Restoration and
Contracting Inc. is a corporation incorporated and existing under and pursuant to the laws of the
11. Upon information and belief, the Defendant Surface Works, Inc. d/b/a Surface
Connection is a corporation incorporated and existing under and pursuant to the laws of the State
12. Upon information and belief, the Defendant Haleigh Gonzales is a citizen and
2
ELECTRONICALLY FILED - 2024 Jul 02 1:58 PM - LEXINGTON - COMMON PLEAS - CASE#2024CP3202843
14. Venue is proper in this Court because the real property which is the subject of
the within mortgage foreclosure action is located in Lexington County, South Carolina.
15. The Court has personal jurisdiction over the Defendants under S.C. Code Ann.
§36-2-803 because, inter alia, they transacted business in Southy Carolina, have an interest in real
property in South Carolina, and/or entered into a contract to be performed in part in South Carolina.
16. Each and every allegation in the above-numbered paragraphs is repeated herein
17. On or about June 30, 2021, Sureste Westwood executed and delivered to
Plaintiff a Loan Agreement, the terms of which Loan Agreement are more fully explained by
reference thereto, with a true and correct copy of said Loan Agreement being attached hereto as
18. Thereafter, Sureste Westwood and Plaintiff, entered into a First Amendment to
Loan Agreement and Other Documents dated June 2, 2022 ("Loan Agreement Amendment") the
terms of which Loan Agreement Amendment are more fully explained by reference thereto, with
a true and correct copy of said Loan Agreement Amendment being attached hereto as Exhibit B
19. On or about June 30, 2021, Sureste Westwood, for value received, executed and
delivered to Plaintiff a Promissory Note ("Note") in the principal amount of Twenty-four million
two-hundred-and-forty thousand and 00/100 ($24,240,000.00) Dollars, with interest thereon, the
terms of which Note are more fully explained by reference thereto. A true and correct copy of the
3
ELECTRONICALLY FILED - 2024 Jul 02 1:58 PM - LEXINGTON - COMMON PLEAS - CASE#2024CP3202843
20. In order to secure payment of the Note, Sureste Westwood executed and
delivered to Plaintiff that certain Mortgage, Assignment of Leases and Rents, Security Agreement
and Fixture Filing dated June 30, 2021, and recorded in the Office of the Register Of Deeds for
Lexington County on June 30, 2021, in Mortgage Book 20950 at Page 3871 ("Mortgage"), wherein
and whereby Sureste Westwood mortgaged to Plaintiff the real property more fully described
herein as follows:
All that certain piece, parcel or tract of land, with all improvements thereon, situate, lying
and being near West Columbia, in the County of Lexington, South Carolina, containing
20.306 acres and being more particularly shown and delineated on an ALTA/ASCM Land
Title Survey of Riverbend Apartments by B.P. Barber & Associates, Inc., dated January
17, 1996, and recorded in the Office of the Register of Deeds for Lexington County in Plat
Book No. 162 Pages 4 and 5, and having such metes and bounds as shown thereon,
incorporated herein by reference.
This being the same property conveyed to Sureste Westwood, LLC by deed of Serenity
Equities LLC, Serenity K1 LLC, Serenity K2 LLC and Serenity Sienna Schorr LLC,
recorded in the Office of the Register of Deeds for Lexington County on June 30, 2021 in
Book 20950 at Page 3865.
Hereafter collectively referred to as the "Real Property." A copy of said Mortgage is attached
21. Subsequently, the Mortgage was assigned to Arbor JPM Funding, LLC by
Assignment of Mortgage, Assignment of Leases and Rents, Security Agreement and Fixture Filing
filed September 3, 2021 in Book 20963 at Page 4098, subsequently assigned back to Arbor Realty
Sr, Inc. by Assignment of Mortgage, Assignment of Leases and Rents, Security Agreement and
Fixture Filing filed October 29, 2021 in Book 20974 at Page 4023, subsequently assigned to Arbor
Realty Commercial Real Estate Notes 2021-FL3, Ltd by Assignment of Mortgage, Assignment of
Leases and Rents, Security Agreement and Fixture Filing filed November 23, 2021 in Book 20979
4
ELECTRONICALLY FILED - 2024 Jul 02 1:58 PM - LEXINGTON - COMMON PLEAS - CASE#2024CP3202843
at Page 2900, subsequently assigned back to Arbor Realty Sr, Inc. by Assignment of Mortgage,
Assignment of Leases and Rents, Security Agreement and Fixture Filing filed May 8, 2024 in
Book 21105 at Page 1762, and subsequently assigned to 100 Riverbend Property Owner LLC by
Assignment of Mortgage, Assignment of Leases and Rents, Security Agreement and Fixture Filing
filed June 7, 2024 in Book 21109 at Page 4713 and to 100 Riverbend Property Owner LLC by
Corrective Assignment of Mortgage, Assignment of Leases and Rents, Security Agreement and
Fixture Filing filed June 20, 2024 in Book 21111 at Page 3966 (collectively referred to the
22. In order to further secure the payment of the Note, Sureste Westwood executed
and delivered to the Plaintiff that certain Assignment of Leases and Rents, dated June 30, 2021
("ALR"), wherein and whereby Sureste Westwood assigned their interest in the rents from the Real
Property to the Plaintiff as set forth therein. The ALR was recorded in the Office of the Register
of Deeds for Lexington County on June 30, 2021 in Book 20950 at Page 3887. A true and correct
copy of said ALR as recorded in Lexington County is attached hereto as Exhibit F and is
23. Subsequently, the ALR was assigned to Arbor JPM Funding, LLC by
Assignment of Assignment of Leases and Rents filed July 28, 2021 in Book 20955 at Page 4781,
subsequently assigned back to Arbor Realty SR, Inc. by Assignment of Assignment of Leases and
Rents filed October 29, 2021 in Book 20974 at Page 4017, subsequently assigned to Arbor Realty
Commercial Real Estate Notes 2021-FL3, Ltd. by Assignment of Assignment of Leases and Rents
filed November 23, 2021 in Book 20979 at Page 2893, subsequently assigned back to Arbor Realty
SR, Inc. by Assignment of Assignment of Leases and Rents filed May 8, 2024 in Book 21105 at
5
ELECTRONICALLY FILED - 2024 Jul 02 1:58 PM - LEXINGTON - COMMON PLEAS - CASE#2024CP3202843
Page 1755, and subsequently assigned to 100 Riverbend Property Owner LLC by Assignment of
Assignment of Leases and Rents filed June 7, 2024 in Book 21109 at Page 4707 (collectively, the
"Assignments of ALR"). A copy of said Assignments of ALR are attached hereto as Exhibit G
24. As additional security and as set forth in the Mortgage, Sureste Westwood
granted a security interest in and to certain personal property ("Personal Property") which was
The UCC-1 Financing Statements and assignments are collectively referred to as the "UCC." The
Personal Property is described in the Mortgage and UCC. A copy of said UCC is attached hereto
25. The Real Property and the Personal Property are hereinafter collectively referred to
as the "Property."
6
ELECTRONICALLY FILED - 2024 Jul 02 1:58 PM - LEXINGTON - COMMON PLEAS - CASE#2024CP3202843
26. The Plaintiff is the owner and holder of the Note, Mortgage, and ALR it is seeking
to foreclose.
27. The Note matured on June 29, 2024. Sureste Westwood has defaulted in the
payment of the Note, inter alia, by failing to pay Plaintiff, on demand, the amounts due and fully
owing under the Note. Sureste Westwood has further defaulted under the Note for failure to
maintain the balance of the Interest Reserve as required by Section 11.05 of the Loan Agreement
and failure to achieve the Second DSCR Rebalance Date as required by Section 2.03 of the Loan
Agreement. The Note is therefore in default and Plaintiff has declared and does hereby declare
the entire balance of all amounts due thereunder to be immediately due and payable, but Sureste
29. The following named party may claim a lien on, or interest in the Real Property by
virtue of instruments filed of record in the Office of the Register of Deeds for Lexington County
or the Office of the Clerk of Court for the above-named County, but, if such lien exists, it is junior
a) Trinity Restoration and Construction, LLC, by virtue of the Notice and Certificate of
Mechanic’s Lien, in the amount of $87,350.00, on April 17, 2024 in Book 21102 at Page
1679.
b) Surface Works, Inc. d/b/a Surface Connection, by virtue of the Mechanic’s Lien Affidavit
in the amount of $4,555.00, filed on November 22, 2022 in Book 21035 at Page 3768.
c) Haleigh Gonzales, by virtue of the Default Judgment against Westwood Estates and Sureste
Property Services in the amount of $7,580.00, filed on February 5, 2024 under Civil Action
No. 2024-cP-32-00548.
30. Valley National Bank, may claim an interest in the Real Property by virtue of an
Assignment of Leases and Rents, given by Serenity Apartments at Columbia, LLC, recorded
7
ELECTRONICALLY FILED - 2024 Jul 02 1:58 PM - LEXINGTON - COMMON PLEAS - CASE#2024CP3202843
September 29, 2015 in Book 17930 at Page 280. Upon information and belief, the associated
mortgage has been satisfied of record, with such satisfaction being recorded in Book 18660 at Page
165 (a true and correct copy being attached hereto as Exhibit I and incorporated herein by
reference), and through oversight or inadvertence, the Assignment of Leases and Rents remains
open of record. Plaintiff alleges Valley National Bank has no interest in the Real Property that is
31. There is due and unpaid on the Note, as secured by the Mortgage, as of July 2, 2024,
the principal sum of Twenty-Four Million Two Hundred Forty Thousand and 00/100
($24,240,000.00) Dollars, plus interest in the amount of Two Million Nine Hundred Seventy Three
Thousand Four Hundred Forty and 00/100 ($2,973,440.00) Dollars, plus late fees in the amount
of Forty-Seven Thousand Seven Hundred Forty-Three and 35/100 ($47,743.35) Dollars, plus
insufficient funds fees in the amount of One Hundred Fifty and 00/100 ($150.00) Dollars. Demand
has been made upon Sureste Westwood to pay said amounts, but Sureste Westwood has refused
to pay the same, or any part thereof, and said refusal is continuing, all to Plaintiff’s injury and
damage in the sum of Twenty-Seven Million Two Hundred Sixty One Thousand Three Hundred
Thirty Three and 35/100 ($27,261,333.35) Dollars, plus interest thereon that continues to accrue
at the default rate, plus additional late fees, plus reasonable attorney’s fees and the costs and
32. Plaintiff hereby expressly seeks a judgment against Sureste Westwood pursuant to
S.C. Code Ann. § 29-3-650 for the full amount due under the Note in the amount of Twenty-Seven
Million Two Hundred Sixty One Thousand Three Hundred Thirty Three and 35/100
($27,261,333.35) Dollars, plus interest thereon that continues to accrue at the default rate, plus
8
ELECTRONICALLY FILED - 2024 Jul 02 1:58 PM - LEXINGTON - COMMON PLEAS - CASE#2024CP3202843
additional late fees, plus reasonable attorney’s fees and the costs and expenses of this action.
Plaintiff reserves all rights to any deficiency remaining after the sale of the Property.
33. The Plaintiff also hereby expressly seeks the foreclosure and sale of the Property
pursuant to S.C. Code Ann. § 29-3-650. The judgment entered against the parties shall be credited
by the amount of the high bid entered at any subsequent foreclosure sale of the Property as
Properties, LP, Steven Ross, Noah Rosenfarb, Henry Burkhalter and Thomas Manglaviti, Jr.
(collectively, the "Guarantors") each executed an Interest Reserve and Operating Expense Reserve
Replenishment Guaranty (the "Interest Reserve Guaranty") whereby each of the Guarantors
individually, unconditionally, and jointly and severally guaranteed that the Interest Reserve will
be maintained as set forth in Section 11.05 of the Loan Agreement. A true and correct copy of the
Interest Reserve Guaranty is attached hereto as Exhibit J and is incorporated herein by reference.
36. As further consideration for the Note and as contained in the Interest Reserve
Guaranty, the Guarantors agreed to pay the amount necessary to replenish the Interest Reserve.
37. Plaintiff has demanded that payment be made to balance the Interest Reserve
and hereby demands payment of the same, but said Defendant Guarantors have refused to pay, and
9
ELECTRONICALLY FILED - 2024 Jul 02 1:58 PM - LEXINGTON - COMMON PLEAS - CASE#2024CP3202843
38. As a result of Defendant Guarantors’ failure to pay the Interest Reserve, their
Guaranteed Obligations (as defined in the Interest Reserve Guaranty and Rebalance Guaranty)
include the full amount due under the terms of the Note and Loan Agreement.
39. There is due and unpaid on the Note, Loan Agreement, and Interest Reserve
Guaranty, as of July 2, 2024, the principal sum of Twenty-Four Million Two Hundred Forty
Thousand and 00/100 ($24,240,000.00) Dollars, plus interest in the amount of Two Million Nine
Hundred Seventy Three Thousand Four Hundred Forty and 00/100 ($2,973,440.00) Dollars, plus
late fees in the amount of Forty-Seven Thousand Seven Hundred Forty-Three and 35/100
($47,743.35) Dollars, plus insufficient funds fees in the amount of One Hundred Fifty and 00/100
($150.00) Dollars. Demand has been made upon the Guarantors to pay said amounts, but the
Guarantors have refused to pay the same, or any part thereof, and said refusal is continuing, all to
Plaintiff’s injury and damage in the sum of Twenty-Seven Million Two Hundred Sixty One
Thousand Three Hundred Thirty Three and 35/100 ($27,261,333.35) Dollars, plus interest thereon
that continues to accrue at the default rate, plus additional late fees, plus reasonable attorney’s fees
40. Plaintiff hereby expressly seeks a judgment against the Guarantors for the
amount due pursuant to the Interest Reserve Guaranty in the amount of Twenty-Seven Million
Two Hundred Sixty One Thousand Three Hundred Thirty Three and 35/100 ($27,261,333.35)
Dollars, plus interest thereon that continues to accrue at the default rate, plus additional late fees,
plus reasonable attorney’s fees and the costs and expenses of this action.
10
ELECTRONICALLY FILED - 2024 Jul 02 1:58 PM - LEXINGTON - COMMON PLEAS - CASE#2024CP3202843
41. Each and every allegation in the above-numbered paragraphs is repeated
Recourse, Rebalance, Prepayment and Out of Balance Payment Guaranty (the "Rebalance
Guaranty") whereby each of the Guarantors individually, unconditionally, and jointly and
severally guaranteed the payment of the Note to Plaintiff. A true and correct copy of the Rebalance
43. As further consideration for the Note and as contained in the Rebalance
Guaranty, the Guarantors agreed to pay the amount necessary to achieve the Second DSCR
44. Plaintiff has demanded that payment be made to achieve the Second DSCR
Rebalance Date as required by Section 2.03 of the Loan Agreement and hereby demands payment
of the same, but said Defendant Guarantors have refused to pay, and therefore are in default.
Obligations (as defined in the Interest Reserve Guaranty and Rebalance Guaranty) include the full
amount due under the terms of the Note and Loan Agreement.
46. There is due and unpaid under the terms of the Note, Loan Agreement, and
Rebalance Guaranty, as of July 2, 2024, the principal sum of Twenty-Four Million Two Hundred
Forty Thousand and 00/100 ($24,240,000.00) Dollars, plus interest in the amount of Two Million
Nine Hundred Seventy Three Thousand Four Hundred Forty and 00/100 ($2,973,440.00) Dollars,
plus late fees in the amount of Forty-Seven Thousand Seven Hundred Forty-Three and 35/100
($47,743.35) Dollars, plus insufficient funds fees in the amount of One Hundred Fifty and 00/100
($150.00) Dollars. Demand has been made upon the Guarantors to pay said amounts, but the
11
ELECTRONICALLY FILED - 2024 Jul 02 1:58 PM - LEXINGTON - COMMON PLEAS - CASE#2024CP3202843
Guarantors have refused to pay the same, or any part thereof, and said refusal is continuing, all to
Plaintiff’s injury and damage in the sum of Twenty-Seven Million Two Hundred Sixty One
Thousand Three Hundred Thirty Three and 35/100 ($27,261,333.35) Dollars, plus interest thereon
that continues to accrue at the default rate, plus additional late fees, plus reasonable attorney’s fees
47. Plaintiff hereby expressly seeks a judgment against the Guarantors for the
amount due pursuant to the Rebalance Guaranty in the amount of Twenty-Seven Million Two
Hundred Sixty One Thousand Three Hundred Thirty Three and 35/100 ($27,261,333.35) Dollars,
plus interest thereon that continues to accrue at the default rate, plus additional late fees, plus
reasonable attorney’s fees and the costs and expenses of this action.
49. By virtue of the defaults referenced herein, Plaintiff seeks the appointment
of a receiver to protect and preserve the Property and to do all acts necessary or required in
connection with the administration and management of the Property, including but not limited to
50. Under the terms of the Loan Agreement, the Defendant Sureste Westwood,
51. In addition, S.C. Code Ann. § 15-65-10 provides for the appointment of a
receiver in this action because, inter alia, the Plaintiff has a right to the Property and its rents and
12
ELECTRONICALLY FILED - 2024 Jul 02 1:58 PM - LEXINGTON - COMMON PLEAS - CASE#2024CP3202843
profits which are in the possession of the Defendant Sureste Westwood, LLC and are in danger of
2. That the amount due Plaintiff on the Note, as secured by the Mortgage, be
ascertained and determined under the direction of this Court, together with attorney’s fees and the
LLC in the amount found to be due, together with attorney’s fees and the costs of this action.
4. That the Court ascertain which lien or liens, if any, as to the Property are
with the appropriate priority, and that the Plaintiff have judgment of foreclosure against the
Defendant Sureste Westwood, LLC subject to the liens of any mortgages found to be prior to
Mortgage held by Plaintiff, for the amount found to be due, together with attorney’s fees and costs
of this action.
6. That Plaintiff’s Mortgage upon the Property be foreclosed, subject to the lien
of any mortgages found to be superior to that of Plaintiff, the equity of redemption barred, and the
13
ELECTRONICALLY FILED - 2024 Jul 02 1:58 PM - LEXINGTON - COMMON PLEAS - CASE#2024CP3202843
c. the surplus, if any, be held subject to the further order of this Court.
Westwood, LLC for the full amount due under the Note at the hearing on the matter, with
subsequent credit to be entered against said judgment after the foreclosure sale of the Real Property
9. That the Plaintiff be granted judgment against Sureste Partners, LP, Sureste
Properties, LP, Steven Ross, Noah Rosenfarb, Henry Burkhalter and Thomas Manglaviti, Jr. for
the amounts due under the Interest Guaranty, Rebalance Guaranty, Note, and Loan Agreement.
10. For such other and further relief as the Court may deem just and proper.
14