Boca Raton Condo Buyers Seek Refunds Amid Foreclosure

Twenty buyers are moving to cancel contracts as the Mandarin Oriental Residences project faces a $418 million foreclosure suit.

Updated on Oct. 21, 2026 in Construction

Boca Raton Condo Buyers Seek Refunds Amid Foreclosure

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Should laws require developers to hold homebuyer deposits in protected escrow accounts until project completion?

Twenty buyers at the Mandarin Oriental Residences in Boca Raton are demanding deposit refunds and contract cancellations. This move follows a $418 million foreclosure lawsuit filed against the property, which is part of the larger Via Mizner development.

Why it matters

The legal turmoil stems from a conflict between Penn-Florida Companies and lender Madison Realty Capital over a $270 million loan. Both sides have traded lawsuits, with the developer blaming project delays on economic factors and the lender alleging a default.

The developer is being sued for $418 million in a foreclosure action, while simultaneously seeking $500 million in damages from the lender. Buyer Nilesh Undavia is among those seeking recovery after paying a $1.65 million deposit on a $5.5 million unit.

The players

Penn-Florida Companies

This real estate developer is the primary entity behind the Via Mizner luxury project in Boca Raton.

Madison Realty Capital

This investment firm is the lender seeking to foreclose on the Mandarin Oriental Residences.

Nilesh Undavia

He is a condo buyer who successfully won an arbitration ruling for the return of his $1.65 million deposit.

The details

Penn-Florida Companies cites pandemic-era challenges, including supply-chain disruptions, hurricanes, and rising interest rates, as primary causes for the project's stalled status. Florida law permits developers to utilize a portion of buyer deposits for construction, a factor currently at the center of the dispute as the lender reportedly withheld funding.

2015: Penn-Florida Companies announced the Via Mizner project.
2022: Nilesh Undavia signed a condo purchase contract.
Early 2025: The rental portion of the project filed for bankruptcy.
Late 2025: The hotel portion of the project entered bankruptcy.
2026: Twenty condo buyers initiated efforts to recover deposits.

Market Landscape

The struggle at the Via Mizner development reflects a wider industry trend where developers face liquidity crises due to the post-pandemic surge in construction costs and interest rate-related real estate defaults. This situation highlights the vulnerability of luxury projects to shifting macroeconomic environments and tightening credit markets.

Prospective buyers in large-scale luxury projects should be aware that state law allows developers to utilize deposit funds for construction, which can impact recovery efforts if a project fails. Those currently under contract in affected developments may face lengthy legal battles to retrieve their capital.

The takeaway

Real estate projects often face complex risks involving debt obligations and market volatility that can severely impact individual buyers. Before signing high-value contracts, investors should conduct thorough due diligence regarding the developer's financial standing and construction loan terms.