A newly constructed luxury condominium building in downtown Birmingham is sitting mostly empty and in trouble with its bank lenders after failing to sell enough $1.7 million-plus condos.

The Forefront, 400 S. Old Woodward Ave., opened nearly two years ago but has sold only two of its 10 residential condos.

The three-story building fell into receivership in December after the project's developer, Joseph "Joey" Jonna of Jonna Luxury Homes, defaulted on a $7.3 million construction loan.

The outstanding balance on the loan was $2.4 million, not including $80,000 in unpaid property taxes, according to a lawsuit filed in December in Oakland County Circuit Court by the holder of the loan, which is now Develop Michigan Real Estate. The building is on the site of a former art supply store.

More:Michigan House Envy: Grosse Pointe mansion is a Mediterranean masterpiece

More:Patti Smith 1918 castle on the canal House Envy

More:House Envy in Ann Arbor

The Forefront's troubles raise questions about the depth of the market in downtown Birmingham for new $1 million-plus condos, which several developers are building in anticipation of more affluent empty-nesters downsizing from big houses.

Two other high-end condo projects are under construction in downtown that could appeal to this same demographic: the 28-condo Brookside Residences, 369 N. Old Woodward, and the five-condo The Bristol at 420 E. Frank St.

Market insiders say that finished units in both future buildings have been selling for $2.5-$3 million, with some Brookside buyers combining two units into one. At The Bristol, four of the five condos are already sold.

Representatives for Brookside and The Bristol either declined comment or did not return messages.

Residential broker John Apap said demand indeed exists for luxury condos in downtown Birmingham. That is why he says he was so surprised by The Forefront's difficulties in selling units.

The Forefront's website — now offline — said the condos' prices started at $1.7 million and ranged in size from 2,500 square feet to 5,100 square feet.

"I was a little shocked by that," Apap said Thursday. “I thought they were doing well in the beginning."

Jonna did not respond to Free Press inquiries about The Forefront.

Court documents filed by his attorney describe how Jonna "worked arduously to complete what is now one of the most luxurious residential developments in the city."

"Through his own personal investment, financial planning, sweat and tears, beginning in 2013, Jonna began the process of replacing a worn art supply store in the heart of Birmingham with a 10-unit residential condominium high rise."

The filings do not offer reasons why The Forefront's units didn't sell.

Aside from the condos, the building contains ground-floor commercial space that did sell, the court documents say. That space is occupied by M.A. Engineering.

The Forefront defaulted on its construction loan in May 2018. In September, Jonna had a tentative $7.4 million deal to sell the condo building to Sterling Heights-based developer P. Eugene D'Agostini, court documents say, but D'Agostini later canceled the deal.

In December, Detroit-based M. Shapiro Management Co. came in as the court-appointed receiver for the condo building. Soon afterward, another potential buyer stepped forward: a limited liability company affiliated with Fadi Nassar of Birmingham-based Amson Nassar Development.

The $7.9 million Nassar deal was at first scheduled to close in February. After various delays, the closing deadline was extended until Monday.

A source close to the situation told the Free Press that the deal once again failed to close, potentially imperiling the prospective buyer's $250,000 nonrefundable deposit.

Nassar told the Free Press, “I’m not at liberty to comment.”

Apap, the Birmingham broker, said that notwithstanding The Forefront's travails, he sees no shortage of buyers for luxury condos priced at $2 million and above.

“A lot of affluent people live in that market, and a lot of them are paying cash," he said.

ContactJC Reindl: 313-222-6631 or jcreindl@freepress.com. Follow him on Twitter @jcreindl. Read more on business and sign up for our business newsletter.