Tides Equities’ weatherworn principals face another two suits over breached recourse guarantees at what couldn’t be a worse time for the partners.
The filings come mere weeks after Starwood won a collective $27 million judgment against Sean Kia and Ryan Andrade over broken loan covenants they personally guaranteed.
The new suits, seeking $40 million and lodged by debt fund Electra Capital, add to a mountain of similar cases: creditors and investors racing to pull what they can from the so-called Tides guys while there is still cash to grab.
The pair could now be personally liable for over $120 million, excluding attorneys’ fees, court records show.
Electra is one of a handful of lenders that had already sued the principals, alleging they breached guarantees on defaulted loans tied to failing multifamily deals. In January, it filed a suit over $8 million in mezzanine debt.
Now, the Tampa-based firm is litigating as a preferred equity investor.
Electra claims it plugged $11 million into two Las Vegas deals — Tides at Whitney Ranch and Tides on Valley View — on the “promise of at least a 12 percent return.” Instead, it got a cluster headache and financial pains.
Neither Kia or Andrade responded to a request for comment.
As in the other suits, Electra claims Kia and Andrade broke myriad guarantees. They failed to complete renovations or keep properties in good shape, let hundreds of thousands in accounts payable pile up and liens mount and ultimately defaulted on $95 million in debt.
“These facts establish that defendants have indisputably defaulted under the terms of the transaction documents governing Electra’s investment,” the complaint reads.
Electra has since tried its best to right the ships. In 2023, it removed Tides as manager of the deals and appointed itself before ultimately buying the firm out of the deals late last year, the new complaints detail.
It has since worked to pay Tides’ lingering invoices, clear liens, repair crumbling buildings, finish renovations and bring delinquent loans up to date.
It’s possible that elbow grease could put Electra out on top. As Sun Belt deliveries dwindle, investors in the area are eyeing a snapback in property values, which plummeted amid the Federal Reserve’s rate-hiking cycle.
It’s unclear what Tides’ old Vegas assets are now worth. But Kia and Andrade bought them at the top of the market, property records show, which may complicate the profit potential of a sale.
The partners paid $50 million for Valley View in May 2022, for example. The previous owner, private equity firm Next Wave Investors, had paid $28.5 million for the asset 15 months before.
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