US partners behind the redevelopment of Coral Beach Club and Horizons and Cottages have defaulted on a mortgage it had for a Hawaii hotel property.

Brickman Associates is a New York-based private equity real estate firm which partnered with Horizons Ltd. to redevelop both Coral Beach Club and Horizons to redevelop the facility into a 150-room five star hotel.

Last month, another Brickman Associates property, the 521-room Sheraton Keauhou Bay Resort and Spa in Hawaii, was sold for just $8 million.

Reports stated Brickman bought the hotel in 2001.

The company took out an $82 million mortgage in 2005 from Lehman Brothers Holdings Inc., which filed for bankruptcy last year. After mergers, the foreclosure was handled by Bank of America.

With $60 million of the loan still unpaid the property was put up for auction and Bank of America bought it for $8 million. They were the only bidders.

Management at Coral Beach said they were not aware of any problems with financing for the Bermuda property and Rod O'Connor, the financial advisor at Brickman's for the property, did not return a request for comment on the financing of the Bermuda property.

Previously George Wardman, CEO of Horizons Ltd., operators of Coral Beach, Horizons and Waterloo House, said the partnership with Brickman would enable the company to get the investment it needed to redevelop the award-winning properties.