MORTGAGE CONSOLIDATION AND SPREADER AGREEMENT

Exhibit 10.2

This instrument prepared by or under the supervision of (and after recording should be returned to):
Name:		David S. Hall, Esq.
Address:		Thacher Proffitt & Wood LLP
		Two World Financial Center
		New York, New York 10281		(Space reserved for Clerk of Court)

MORTGAGE CONSOLIDATION
AND SPREADER AGREEMENT

     THIS MORTGAGE CONSOLIDATION AND SPREADER AGREEMENT (this “ Agreement ”) is made as of October 10, 2006 by and between TARRAGON LUGANO LLC , a Delaware limited liability company, BALLANTRAE TARRAGON LLC , a Florida limited liability company, REFLECTION LAKES TARRAGON, LLC , a Florida limited liability company, OMNI MONTERRA LLC , a Florida limited liability company, YBOR CITY TARRAGON, LLC , a Delaware limited liability company, and MADISON AT PARK WEST TARRAGON, LLC , a South Carolina limited liability company (each a “ Borrower ” and collectively the “ Borrowers ”), having an address c/o 423 West 55th Street, 12th Fl., New York, New York 10019, and BARCLAYS CAPITAL REAL ESTATE INC. , a Delaware corporation (“ Lender ”), whose address is 200 Park Avenue, New York, New York 10166.

NOTICE TO RECORDER : This Agreement amends and renews five (5) previous Florida mortgages identified in attached Exhibit B as the “Original Florida Mortgages” and consolidates them into one singular mortgage instrument made by the Borrowers party hereto, encumbering the five Florida properties identified herein and therein and spreading the lien of the consolidated mortgage to encumber a sixth mortgaged property located in the State of South Carolina. All required Florida documentary stamp taxes and nonrecurring intangible personal property taxes were previously paid upon recordation of the five Original Florida Mortgages in the Public Records of the various Florida counties identified in Exhibit B, in each case based on the respective principal amounts of the original promissory notes respectively secured thereby. The aggregate outstanding principal balance of the five Florida loans secured by the Original Florida Mortgages prior to this amendment was $196,426,806, and in connection with this amendment the Borrowers are paying down the aggregate outstanding principal balance of the five Florida loans to $192,114,000.

As amended and consolidated by this Agreement, the Original Florida Mortgages together: (i) encumber Florida real property located in various counties, having an aggregate approximate value of $250,800,000, (ii) encumber real property located in the State of South Carolina having an approximate value of $35,600,000, and (iii) secure six separate loans in the aggregate principal amount of $215,000,000, with five such loans being renewals of the five Florida loans secured by the Original Florida Mortgages and the sixth loan being a renewal of an existing loan to the owner of the South Carolina property. Pursuant to Sections 201.08(5) and 199.133(2) of the Florida Statutes and regulations promulgated thereunder, the amended and consolidated mortgages are subject to additional Florida documentary stamp taxes and intangible taxes based on the increase, if any, in the Florida tax base resulting from the application of rules limiting the tax base when there is collateral in more than one state.

Pursuant to Rule 12B-4.053(31)(b) of the Florida Administrative Code, the tax base for documentary stamp tax on a multi-state mortgage recorded in Florida that pledges both property inside Florida and property outside Florida is the percentage of the secured indebtedness which the value of the Florida mortgaged property bears to the total value of all the security, wherever located. The $250,800,000 value of the Florida mortgaged property represents 86.7219 percent of the total value of all the collateral ($286,400,000), and said percentage of the $215,000,000 aggregate principal amount of the loans is $186,452,051, which when rounded up to the next $100 (i.e., to ($186,452,100) is the documentary stamp tax base for the amended and consolidated mortgages. Pursuant to Rule 12C-2.004(2)(b) of the Florida Administrative Code, the tax base for nonrecurring intangible personal property taxes on the amended and consolidated mortgages is also based on 86.7219 percent of the $215,000,000 aggregate principal amount of the loans, or $186,452,051. Because the tax base for the amended and consolidated mortgages is lower than the previous tax base on which stamp taxes and intangible taxes were paid (i.e., the outstanding $192,114,000 principal balance secured by the Original Florida Mortgages and renewed hereby), no additional stamp taxes or intangible taxes are payable with respect to this Agreement or the amended and consolidated mortgages.

W I T N E S S E T H:

     WHEREAS, Lender is the owner and holder of the five mortgages more particularly described in attached Exhibit B (the “ Original Florida Mortgages ”) and respectively recorded in the Public Records of Palm Beach County, Hillsborough County, Lee County, and Seminole County, Florida, respectively made by the following Borrowers: TARRAGON LUGANO LLC, a Delaware limited liability company, BALLANTRAE TARRAGON LLC, a Florida limited liability company, REFLECTION LAKES TARRAGON, LLC, a Florida limited liability company, OMNI MONTERRA LLC, a Florida limited liability company, and YBOR CITY TARRAGON, LLC, a Delaware limited liability company;

     WHEREAS, the Original Florida Mortgages respectively encumber the lands more particularly described in Exhibit A-1 (Palm Beach County, Florida), Exhibit A-2 (Seminole County, Florida), Exhibit A-3 (Lee County, Florida), Exhibit A-4 (Lee County, Florida) and Exhibit A-5 (Hillsborough County, Florida), and all improvements thereon, leases and rents thereof, and other collateral pertaining thereto described in the Original Florida Mortgages (collectively, the “ Florida Property ”), each to secure a loan from Lender to the respective Borrower in the original principal amount set forth in attached Exhibit B (the “ Original Florida Loans ”), each evidenced by one or more promissory notes of even date with the respective Original Florida Mortgage in said aggregate original principal amount made by the respective Borrower in favor of Lender (the “ Original Florida Notes ”), and each governed by a Loan Agreement of even date with the respective Original Florida Mortgage made by Lender and the respective Borrower (the “ Original Florida Loan Agreements ,” and together with the Original Florida Mortgages and the Original Florida Notes, the “ Original Florida Documents ”);

     WHEREAS, Borrower MADISON AT PARK WEST TARRAGON, LLC, a South Carolina limited liability company (“ Madison ”), is the owner of the lands more particularly described in attached Exhibit A-6 (Charleston County, South Carolina), and all improvements thereon, leases and rents thereof, and other collateral pertaining thereto (the “ South Carolina Property ”), and Madison is the Borrower of an existing loan from Lender in the original principal amount of $23,400,000.00 (the “ Original Madison Loan ”) evidenced by a promissory note dated November 8, 2005 in said original principal amount made by Madison in favor of Lender (the “ Original Madison Note ”) and governed by a Loan Agreement of even date therewith made by Lender and Madison (the “ Original Madison Loan Agreement ”);

     WHEREAS, the Original Florida Loans and the Original Madison Loan are referred to herein collectively as the “ Original Loans ,” the Original Florida Notes and the Original Madison Note are referred to herein collectively as the “ Original Notes ,” the Original Florida Loan Agreement and the Original Madison Loan Agreement are referred to herein collectively as the “ Original Loan Agreements ,” and the Original Florida Documents and the Original Madison Note and the Original Madison Loan Agreement are referred to herein collectively as the “ Original Documents ”; and

     WHEREAS, Lender is willing to extend the maturity date of the Original Loans and to amend other terms of the Original Loans and the Original Documents as requested by the Borrowers, provided that each Borrower (i) agrees to consolidate the Original Florida Mortgages into one mortgage instrument encumbering all of the Florida Property as security for all of said extended and amended indebtedness, (ii) spreads the lien of said consolidated mortgage to

encumber the South Carolina Property as security for all of said extended and amended indebtedness, (iii) amends and restates the Original Florida Mortgages as so consolidated and spread to contain terms and conditions acceptable to Lender as provided hereinafter, including without limitation provisions cross-defaulting said extended and amended indebtedness and cross-collateralizing the same by all of the Florida Property and the South Carolina Property, (iv) repays a portion of the principal balance outstanding under its respective Original Loan so that the reduced aggregate principal balance outstanding under all the Original Loans shall be $215,000,000, (v) executes and delivers to Lender one or more renewal promissory notes evidencing its respective Original Loan as so reduced, extended and amended, and (vi) enters into an amendment of its respective Original Loan Agreement;

     NOW, THEREFORE, in consideration of the foregoing recitals and the sum of TEN DOLLARS and other good and valuable consideration, Borrowers and Lender agree that the foregoing recitals are true and correct and further agree as follows:

     In addition to the capitalized terms defined in the foregoing recitals and set forth below, the capitalized terms used but not defined herein shall have the respective meanings set forth in the Loan Agreement. The following capitalized terms shall have the following respective meanings:

     (a) “ Loans ” means the Original Florida Loans and the Original Madison Loan, each as extended and amended in connection with this Agreement, in the aggregate principal amount of $215,000,000 and in the respective principal amounts set forth in Section 2(a) below.

     (b) “ Mortgage ” means the Amended and Restated Mortgage, Assignment of Leases and Rents, Security Agreement and Fixture Filing of even date herewith made by the Borrowers and Lender to amend further and to restate and supersede in their entirety the Original Florida Mortgages as consolidated and amended hereby.

     (c) “ Notes ” means the Amended and Restated Promissory Notes of even date herewith executed in favor of Lender by each of the respective Borrowers (together with all notes issued in full or partial replacements thereof, or in substitution or exchange therefor, and all amendments thereto) to evidence the renewal of the reduced principal balance outstanding under the respective Original Notes previously made in favor of Lender by each of the Borrowers.

     (d) “ Loan Agreements ” means the Original Loan Agreements, each as amended by an Amendment to Loan Agreement of even date herewith executed by Lender and the respective Borrower to govern the separate Loan made by Lender to such Borrower.

     (e) “ Property ” means the Florida Property and the South Carolina Property.

     (a) By the execution and delivery of its respective Note or Notes to Lender by each of the Borrowers, the outstanding principal balance of the Original Loan owing under the Original Note or Original Notes made by such Borrower has been renewed and the maturity thereof has

been extended to the new maturity date set forth in the respective Loan Agreement. The following Loans are and shall be evidenced by the respective Notes made by the respective Borrowers of even date herewith, as set forth below:

		Principal Amount of Notes and
Borrower		Loans
Tarragon Lugano LLC		$	53,303,000
Ballantrae Tarragon LLC		$	40,393,000
Reflection Lakes Tarragon, LLC		$	50,076,000
Omni Monterra LLC		$	41,200,000
Ybor City Tarragon, LLC		$	7,142,000
Madison at Park West Tarragon, LLC		$	22,886,000
Aggregate Principal Amount:		$	215,000,000

     (b) Each Loan shall bear interest as provided in the respecti