The lenders on a stalled 242-unit condominium development in Revere are asking a bankruptcy judge to accelerate foreclosure of the oceanfront construction site, saying the project’s bankrupt developer is "hopelessly under water."

Attorneys for the Connecticut-based Patriot Group, which loaned the Ocean Club $13.6 million in pre-development financing, said in a recent court filing that the Ocean Club’s holding company "lacks any reorganization prospect" in bankruptcy court because "the debtor has no financing, income or employees."

The Patriot Group has asked a judge to lift a stay that is blocking foreclosure auction of the Ocean Club’s two acres of beachfront land. A last-minute bankruptcy filing by the Ocean Club’s holding company, Revere Beach Holdings LLC, halted an auction at the site last month. That auction has been rescheduled for March 26.

The Ocean Club’s developer, Steven Fustolo, has said his massive complex would bring Miami Beach to Revere. He spent roughly $5 million assembling the development site, but was unable to secure a $120 million construction loan to move the project forward.

The Patriot Group demanded repayment of its preconstruction loan last August, and initiated foreclosure proceedings in January. Fustolo took Revere Beach Holdings into bankruptcy in hopes of finding a friendly buyer for the Patriot Group’s debt.

A January 2007 appraisal on file with the court pegged the value of the Ocean Club’s land and permits at $20.5 million. However, an updated appraisal prepared by CB Richard Ellis for the Patriot Group puts the site’s value at just $3.25 million. In a court filing, the Patriot Group predicted the land wouldn’t even fetch that much at auction.

The Patriot Group wants to accelerate foreclosure at the site because unpaid real estate taxes are eroding the financiers’ position in the property. The Patriot Group estimated that Fustolo has a total of $21.8 million in encumbrances on the property, including $342,000 in back taxes.