TAMPA - In a move that could mean instant financing for the troubled 52-story Trump Tower Tampa, a New York hedge fund is negotiating to become a financial partner in the riverfront project.

Donald Trump's organization confirmed Friday that the celebrity developer helped put together the hedge fund and is hoping to finalize the deal next week.

Officials with the original partners, Tampa-based SimDag LLC, wouldn't elaborate but confirmed the negotiations and said work could resume in 60 to 90 days.

"We're in the process of trying to close the deal," said John Reich, president of the company's construction division, SimDag Towers LLC. "We're very hopeful."

Hedge funds can be a last-ditch effort to get financing when traditional funding fails, and partners in the project say it could mean the difference between the tower being built or not. The fund would be the third group to step into the stalled project.

Trump Tower was announced two years ago but remains without financing. The tower has gained notoriety nationwide but is entangled in $3.3 million in construction liens and lawsuits filed recently by buyers who say they don't think the tower will be built by the December 2008 deadline mandated in their contracts.

Trump licensed his name to SimDag for an undisclosed amount and made one appearance in Tampa in early 2005 to promote the project. In recent months, however, he has expressed frustration with the lack of progress.

Trump tried to buy out SimDag last fall, but the developer instead sold to Orlando private equity firm Mirabilis Ventures Inc. SimDag remained as a partner. Earlier this week, The Related Group, a Miami-based developer working on three other Trump projects, said it had signed a letter of intent to become the general managing partner for the Tampa tower.

'Tight-Lipped' About Involvement

Eric Fordin, a project executive with Related, said his company will stay involved, no matter what.

"Everything is still transpiring, and we have to keep it tight-lipped at this point," he said. "We're still involved and working hand-in-hand with the partners."

The hedge also could take control of at least two other SimDag projects, Antigua Bay in Clearwater and the former Plaza At Channelside, said Henry Lewis, whose Tampa company, City Blue Print, printed construction plans for the tower. "It's my understanding that this is not just specific to Trump."

Mirabilis already has purchased the right to build both of those towers along with the Trump tower. Representatives with Mirabilis could not be reached for comment.

It is unclear how much of a role SimDag and Mirabilis would play in the development.

A Trend In The Making?

Hedge funds taking over real estate developments is not unusual but could become a growing trend since so many developers are having a difficult time getting large-scale projects off the ground, said Jim Hedges, with LJH Global Investments, a Naples-based hedge fund advisory firm.

It's a "last resort" for developers wanting to finish what they started, Hedges said.

"It puts the success of the project in further doubt because in order to pay off the high interest and the principal of the debt and have remaining equity worth anything, you'd have to sell condos at a lot higher prices."

That's not a likely scenario for SimDag and Mirabilis. SimDag already passed along at least $40 million in construction increases to buyers with reservations to purchase units. Condos originally sold for $700,000 to more than $6 million. It has since converted purchase agreements to hard contracts, meaning the prices can't be changed.

Reporter Shannon Behnken can be reached at (813) 259-7804 or sbehnken@tampatrib.com.