CondoVultures.com :: Peter Zalewski's Blog Feed

900 Biscayne's Construction Loan Sells To Caribbean Investor

Fri, 13 Nov 2009 14:41:47 -0500

Germany's Hypo Real Estate Capital has sold the remaining balance of a $261 million construction loan on the Terra Group's luxury 900 Biscayne Bay condominium tower in Downtown Miami to a entity based in the Caribbean, according to a new report from Condo Vultures� LLC.

Roost Investments Limited of Grand Cayman, Cayman Islands, purchased the note on the 63-story tower on Biscayne Boulevard with an outstanding balance of nearly $120.5 million and about $28 million of "capitalized interest" for an undisclosed price, according to the Condo Vultures� analysis of Miami-Dade County records.

Hypo Real Estate Capital's Jeffrey L. Phelps and Christopher Peters signed the mortgage assignment on Oct. 16, 2009 in New York and the transfer was recorded Oct. 30, 2009 in Miami-Dade County, according to government records.

In December 2004, Hypo Real Estate Capital provided the construction loan to 900 Biscayne LLC. Terra's founder Pedro Martin and the entity Terra-Archiplan 900 Management Inc with Pedro Martin, David Martin, Manuel Grosskopf, and Raimundo Onetto, are identified as "guarantors" on the note assignment, according to Miami-Dade County records.

"Condo construction loans on above-average properties in South Florida are trading in today's market at north of 50 cents on the original principal amount," said Peter Zalewski, a principal with the Bal Harbour, Fla.-based real estate consultancy Condo Vultures�. "If the buyer of the 900 Biscayne construction note was able to acquire the outstanding debt at that type of price, it would be hard to imagine how an industry watcher would not like the note buyer's chances to succeed.

"After all, 900 Biscayne is a class A property with flow-through units with floor-to-ceiling windows that overlook Biscayne Bay, South Beach, and what seems like all of South Florida."

Zalewski is one of three real estate professionals participating in the Dec. 1 Condo Vultures� panel discussion examining the latest condo bulk buying trends. All three experts have completed multimillion dollar deals for bulk product in Miami.

Goldman Sachs Sells Bulk Condos For $109 Per Foot In Miami

Thu, 12 Nov 2009 15:30:02 -0500

Investment banking giant Goldman Sachs has sold off the remaining 165,000 square feet of new, vacant condos in the troubled suburban Miami project Downtown Dadeland for an average of $109 per square foot, according to a new report from Condo Vultures� LLC.

The purchase price represents a 57 discount off of the average transaction price of $255 per square foot recorded on more than 50 units that were purchased by individual investors in 2008 and 2009, according to a Condo Vultures� analysis of Miami-Dade County records.

The newly created Miami entity, Dadeland Investors LLC with Gordon Laing and Robert MacPherson of Canada, paid a combined $17.9 million for 158 units scattered throughout a seven-building project in the Miami suburb of Kendall, according to the Condo Vultures� report.

"This is the second lowest price paid per square foot for a bulk deal involving newly constructed condos in South Florida," said Peter Zalewski, a principal with the Bal Harbour, Fla.-based real estate consultancy Condo Vultures�. "Using a benchmark of $250 per square foot for construction replacement costs, a purchase price of $109 per square foot provides the buyer plenty of freedom to be patient in renting and/or selling its newly acquired inventory."

The bulk buyer purchased the remaining 38 percent of the condo project from the seller in two transactions that were recorded on the same date of Nov. 9, 2009 at a blended price of $109 per square foot.

South Florida Residential Inventory Rises - Again

Wed, 11 Nov 2009 15:23:33 -0500

For the second time in three weeks, the number of South Florida single-family houses, townhouses, and condominium units on the resale market increased on a week-over-week basis, according to a new report from Condo Vultures� LLC.

As of Nov. 9, there are 69,674 residences for resale in Miami-Dade, Broward, and Palm Beach counties, up 0.5 percent, or 332 properties, from 69,342 on Nov. 2. Up until the week of Oct. 26 when the total South Florida inventory increased by 18 residences, the tricounty region had been experiencing continuous decreases in properties available for resale, according to the Condo Vultures� report produced using Florida Association of Realtors data.

"As South Florida prepares for the winter tourism season that symbolically begins with the Thanksgiving holiday in last full week of November, it is apparent that some sellers are deciding this could finally be the time to offload their properties at an acceptable price," said Peter Zalewski, a principal with the Bal Harbour, Fla.-based real estate consultancy Condo Vultures�. "Signs are emerging in many coastal submarkets that pricing is starting to stabilize as inventory has steadily declined. The weakness of the U.S. dollar is attracting a steady flow of foreign national investors with strong currencies."

16th Bulk Deal Trades At 44% Discount In South Florida

Tue, 10 Nov 2009 12:40:28 -0500

A newly created Miami corporation paid $223 per square foot - a 44 percent discount off of the average closed sales price in the project - for 34 units in the 3030 Aventura condominium in Northeast Miami-Dade County, according to a new report from Condo Vultures� LLC.

The units acquired in bulk represent 76 percent of the 45-unit project built in 2007 at 3030 NE 188th St. with seven stories and 89,000 square feet of saleable space fronting a canal in the city of Aventura.

The buyer paid nearly $15.4 million for nearly 69,000 square feet of saleable space, which works out to an average of $452,300 per unit. Prior to the bulk deal, individual buyers acquired 11 units at an average price of $733,400 per unit, or $400 per square foot, according to the Condo Vultures� report based on Miami-Dade County records.

"Aventura is a mature market with a strong demand from primary users, second-home buyers, and investors," said Peter Zalewski, a principal with the Bal Harbour, Fla.-based real estate consultancy Condo Vultures�. "That being said, individual buyers - many with strong foreign currencies - are acquiring units at a pace of 10 condos per day in Greater Downtown Miami on a retail basis for $200 per square foot.

"Given the size of the units at 3030 Aventura , we would expect the new owners to retrade rather than rent the units."

In Greater Downtown Miami, there have been nine bulk transactions for 483 units and more than 538,000 square feet that have closed for nearly $96 million. This price works out to an average of $178 per square foot, according to the Condo Vultures� Bulk Division.

Overall, the 3030 Aventura project is the 16th bulk deal for a new condo construction product to close since July 2008. Bulk buyers have paid an average of $201 per square foot for 1.1 million square feet of saleable space located in 936 units. The average price per unit is $237,700, according to the Condo Vultures� Bulk Deals Database�.

$7.4 Million Paid For 3 Fisher Island Condos In Miami Beach

Mon, 09 Nov 2009 17:45:29 -0500

A trio of unrelated investors paid a combined $7.4 million, or an average of $717 per square foot, for three condos of varying ages and condition in the first week of November on wealthy Fisher Island in Miami Beach, according to a new report from CondoVultures.com.

The combined purchase prices represent a 24 percent discount off of the original amounts paid for the respective units located in the Seaside, Palazzo Del Mare, and the Oceanside condo projects.

In a sign of just how much capital is circling the South Florida market, only one buyer - Fana Fisher Island LLC of Auburn, Wash. - used financing to complete their transaction.

"There is a growing consensus among all-cash buyers that that the time to buy residential product in South Florida is approaching," said Peter Zalewski, a principal with the Bal Harbour, Fla.-based real estate consultancy Condo Vultures�. "Fisher Island is one of the most exclusive - and expensive - areas of South Florida. To see buyers closing on multimillion dollar units built more than a decade ago is a testament of just how desirable Fisher Island is for some investors even if there is renovations to perform.

"The only thing we wonder is, why aren't the buyers aren't picking off the Fisher Island units in foreclosure?"

Lenders File 272 Foreclosure Actions Per Day In October

Fri, 06 Nov 2009 05:20:55 -0500

Lenders filed an average of 272 foreclosure actions per day in October 2009 against properties in the tricounty South Florida region, representing an eight percent year-over-year increase compared to 2008 and an 86 percent increase from 2007, according to a new report from CondoVultures.com.

The October 2009 foreclosure filings puts the tricounty South Florida region of Miami-Dade, Broward, and Palm Beach counties on pace for nearly 98,000 actions this year. The region was on pace for 102,000 foreclosure filings on June 30 and 99,000 on Sept. 30, according to the Condo Vultures� Foreclosure Database�.

"Foreclosure filings are up from last year but beginning to slow in volume compared to a quarter or two ago," said Peter Zalewski, a principal with the Bal Harbour, Fla.-based real estate consultancy Condo Vultures� LLC. "At one time the region looked poised to eclipse the 100,000 threshold but that possibility is beginning to wane."

Expert Panel To Discuss Condo Bulk Deal Trends

Thu, 05 Nov 2009 05:50:06 -0500

A trio of real estate experts who have each completed multimillion dollar distressed condo deals in South Florida will discuss on Dec. 1 the latest trends in bulk buying at the upcoming Condo Vultures� seminar.

Robert Lechter, who acquired the troubled 63-unit Brickell Station Lofts residential tower in a note sale that closed in September 2009, will be joined on the panel by Robert Given, executive vice president of investment properties and the multi-housing group for CB Richard Ellis real estate brokerage, and Condo Vultures� consultant and licensed real estate broker Peter Zalewski.

Frank Thomas, the national bulk sales director for Condo Vultures� Realty, will moderate the panel discussion that includes a networking session and a questions-and-answers period. The event is scheduled to begin at 5.30 pm and end at 8 pm.

57-Unit South Beach Tower Trades For $10.5 Million

Wed, 04 Nov 2009 15:57:15 -0500

A newly created Fort Lauderdale investment fund has paid $10.5 million for an eight-story residential rental tower with 57 units in Miami Beach's famed South Beach neighborhood, according to a new report produced using the Condo Vultures� Bulk Deals Database�.

Saxo LLC, with registered agent Frederic Barthe, paid an average of $184,211 per door for the 1958 tower located at 1746 Meridian Ave., just north of the popular Lincoln Road pedestrian mall.

The tower has nearly 42,000 square feet of livable space, putting the purchase price at $251 per square foot, according to the CondoVultures.com report based on government records.

The seller, 1746 Meridian LLC with managing members David Philips, Douglas Walker, and David Prince, originally purchased the tower back in April 2005 for $7.3 million, or $174 per square foot.

The project, which features 121 bedrooms and 136 bathrooms, is located north of Lincoln Road, west of the Miami Beach Convention Center, and south of the Miami Beach Golf Course.

"The demand for multihousing product in Miami Beach is extremely strong right now hence the premium paid for this project," said Peter Zalewski, a principal with the Bal Harbour, Fla.-based real estate consultancy Condo Vultures� LLC. "The assessed value of this project from a tax perspective is $5 million, or $119 per square foot. The thing is, many private equity groups have raised capital for distressed buying but thus far have not been able to purchase at the discounts that they had originally envisioned.

"The weak U.S. dollar, however, is making Miami Beach extremely attractive for foreign buyers."

South Florida Inventory Tumbles 1.1% to 69,000 Homes

Tue, 03 Nov 2009 14:52:00 -0500

South Florida's residential resale inventory finally fell below the elusive 70,000 threshold, a number that has proven difficult to eclipse for the last month for the tricounty region of Miami-Dade, Broward, and Palm Beach counties, according to a new report from CondoVultures.com.

The number of single-family houses, townhouses, and condominium units on the resale market in South Florida tumbled 1.1 percent on Nov. 2 to 69,342 residences. For the month of October, there were between 70,067 to 70,342 residences for resale in South Florida, according to the report produced using Florida Association of Realtors data.

A week ago on Oct. 26, the number of residential properties for resale actually increased by 18 residences to 70,085, marking the first increase - albeit small - in the 11 months that CondoVultures.com has been tracking the available inventory.

"The slight gain in South Florida inventory recorded in the last week of October appears to have been an anomaly," said Peter Zalewski, a principal with the Bal Harbour, Fla.-based real estate consultancy Condo Vultures� LLC. "To see inventory fall by nearly 750 properties in the week following the increase indicates that the quickly approaching Nov. 30 deadline for the $8,000 first-time homebuyers tax credit may have been a factor."

Signs of Bottom - Real Or False - Emerge In South Florida

Mon, 02 Nov 2009 18:29:19 -0500

For the first time in more than a year, the number of residences for resale in South Florida increased on a week-over-week basis, following a 35 percent decrease in the previous 11 months, according to a new report from Condo Vultures� LLC.

The surprise rise in resale inventory of single-family houses, townhouses, and condominium units in Miami-Dade, Broward, and Palm Beach counties comes at a time when the leading national housing price indicator - the S&P/Case-Shiller Home Price Index - posted an increase in Miami for the third consecutive month.

It is against this backdrop that CondoVultures.com's proprietary Vultures Database� of coastal South Florida residential properties that are reduced by at least 10 percent or $100,000 fell to a two-year low in quantity. As of September 2009, the Vultures Database� is tracking 3,321 properties reduced by an average discount of 38 percent. A year earlier in September 2008, there were 4,456 properties reduced by 33 percent in the Vultures Database�. Compare that to September 2007, when there were 3,713 properties beng monitored that had been reduced by an average of 20 percent.

"Signs are emerging in no organized manner that some South Florida submarkets - primarily new product near the water - are beginning to stabilize in terms of price and supply," said Peter Zalewski, a principal with the Bal Harbour, Fla.-based real estate consultancy Condo Vultures�. "These signs have some people questioning whether South Florida is near a bottom or a plateau before another drop. Persuasive arguments can be made by both camps especially as mortgage financing remains a serious challenge now and in the foreseeable future."

Scientist: Evidence Lacking Chinese Drywall A Health Hazard

Fri, 30 Oct 2009 12:38:49 -0400

A top U.S. scientist contends that the initial study results from the Chinese Drywall used in 1,900 households in 30 states does not contain any evidence of being a health hazard.

A $3.5 million study was launched earlier this year after receiving numerous complaints from homeowners that the Chinese Drywall used in their residences was causing coughing, skin irritation, and metal corrosion.

"I'm not saying there's not a health risk here," Michael McGeehin, director of health effects at the Centers for Disease Control and Prevention, told the South Florida Sun-Sentinel. "But right now we do not see the levels that are normally associated with a health risk."

The comments come just two weeks after three insurance companies began to cancel or refuse to renew policies on homes where Chinese Drywall is present. Industry watchers expect other insurers to follow suit, creating a dilemma for owners who decide not to live in the Chinese Drywall homes.

Chinese Drywall is pressed gypsum imported from mainland China by various U.S. and European suppliers between 2004 and 2007 in an attempt to satisfy the strong demand from residential builders constructed tens of thousands of new homes nationwide.

Florida was a top destinations for the Chinese Drywall as the state experienced a speculative building boom that added thousands of new residences at the same time that five hurricanes in three years damaged thousands of homes.

South Florida Residential Inventory Rises Slightly

Wed, 28 Oct 2009 16:15:55 -0400

For the first time in at least a year, the number of residences on the resale market in South Florida rose on a week-over-week basis, led by an increase in single-family houses being put on the market, according to a new report from Condo Vultures� LLC.

Owners added 18 additional single-family houses, townhouses, and condo units to the resale pool in the last week ending Oct. 26 compared to a week earlier. There are currently 70,085 single-family houses, townhouses, and condominium units on the market in Miami-Dade, Broward, and Palm Beach counties, compared to 70,067 residences for resale on Oct. 19, according to the report compiled using Florida Association of Realtors data.

"We are monitoring this closely to see if this increased resale inventory is an anomaly or the start of a new trend," said Peter Zalewski, a principal with the Bal Harbour, Fla.-based real estate consultancy Condo Vultures�. "If it is the start of a new trend, the next question becomes are the new resales be supplied by lenders who have foreclosed on residences or stable sellers who think it is finally an appropriate time to try to offload their properties.

"The fact that the winter tourism season, which is a strong buying time for South Florida, begins in a month will also undoubtedly play a role in the resale inventory and pricing."

Miami Beach Ocean Drive Hotel Trades For $421 Per Foot

Tue, 27 Oct 2009 15:51:41 -0400

A Miami Beach Art Deco hotel located on the famed Ocean Drive was purchased for $421 per square foot by a local hotelier in a deal that closed all cash on Oct. 23, according to a new report from Condo Vultures� LLC.

The newly created Ocean Hotels Investments Corp. with Juan Pablo D'Onofrio as president paid $8.05 million, or $187,209 per room, for the 43-room Leslie Hotel built in 1937.

The seller, Leslie Beach Associates LLC with Fredric H. Gould of Great Neck, N.Y., purchased the Leslie Hotel at 1244 Ocean Drive in September 2005 for $9.1 million, or $476 per square foot. The Leslie Hotel has an assessed value of $4.7 million, or $246 per square foot, in 2009, according to the Miami-Dade County Tax Assessor.

"Ocean Drive is the destination in Miami Beach and South Florida," said Peter Zalewski, a principal with the Bal Harbour, Fla.-based real estate consultancy Condo Vultures�. "To pick up an Art Deco hotel in a premier South Beach location is not easy nor cheap. The buyer, who operates two nearby hotels, should have a better understanding than most of the market's potential and pitfalls."

Condo Sales, Foreclosures Focus Of Tonight's Seminar

Tue, 27 Oct 2009 13:20:15 -0400

Developers sold more than 900 condo units at a price of over $250 million in the 60-block stretch of Greater Downtown Miami in the third quarter of 2009, representing a 278 percent increase in sales activity from the previous quarter, according to a new White Paper report from Condo Vultures�.

As the developer condo inventory falls, the number of foreclosure filings in Miami-Dade County increased 22 percent to 4,366 notices of default - the first step in the repossession process - actions in the third quarter of 2009 compared to 3,569 actions in 2008, according to the report produced using the Condo Vultures� Foreclosure Database�.

Condo Vultures� founder Peter Zalewski is scheduled to discuss the third quarter Miami condo results and future trends at the next Condo Vultures� Seminar Series on Oct. 27 at the Doubletree Grand Hotel in Downtown Miami.

3 Florida Banks Seized By Regulators

Mon, 26 Oct 2009 16:06:39 -0400

Regulators shuttered three Florida banks and seven community banks overall in five states on Friday with combined assets of $1.2 billion and deposits of $1 billion, according to an analysis by Condo Vultures� LLC.

The Federal Deposit Insurance Corp, which insures deposits up to $250,000 per account, estimates the latest round of bank failures will cost an estimated $357 million, pushing the total losses for the year up to $27 billion, according to the Condo Vultures report.

In Florida, regulators stormed Flagship National Bank, Hillcrest Bank Florida, and Partners Bank which have combined assets of $339 million and deposits of $324 million. Banks were also closed in Georgia, Illinois, Minnesota, and Wisconsin.

"The FDIC opened a bank seizure and asset sale office in Jacksonville, Florida, in September that will eventually grow to 500 people," said Peter Zalewski, a principal with the Bal Harbour, Fla.-based real estate consultancy Condo Vultures�. "We think this is just the beginning of what will be many failed banks in the state of Florida and the Southeastern United States."

Starwood's Arrival Already Effecting Miami Condo Market

Fri, 23 Oct 2009 13:23:12 -0400

The Starwood Capital Group is already having an effect on the Greater Downtown Miami condo market less than two weeks after the investment fund was identified as the suitor of 21 percent of the unsold developer units from failed construction lender Corus Bank.

The Related Group, a development company that controls 36 percent of the 8,600 unsold developer condo units in Greater Downtown Miami, this week slashed prices at its signature ICON Brickell complex by 30 percent to buyers who have yet to close under original preconstruction contracts. There is no word on the discounts that will be offered to new buyers.

Simultaneously, the condo construction lender that financed a new tower just down the street from ICON Brickell that remains more than 50 percent unsold is finalizing a new pricing schedule to blow out the available units in the respective project in a matter of weeks.

"Starwood Capital's acquisition of the Corus Bank loan portfolio is forcing developers and lenders in Greater Downtown Miami's condo market to recalibrate," said Peter Zalewski, a principal with the Bal Harbour, Fla.-based real estate consultancy Condo Vultures� LLC. "It is no surprise that price cuts and financing options are already being introduced in nearby projects in an attempt to compete with the product acquired by Starwood.

"It is not an understatement to say that Starwood Capital has ascended from a spectator to market maker status in Greater Downtown Miami's condo market in the course of a month."

Residential Resale Inventory Stalls In South Florida

Thu, 22 Oct 2009 02:59:53 -0400

For the second consecutive week, the number of single-family houses, townhouses, and condo units for resale in South Florida was stuck at slightly more than 70,000 residences, according to a new report from Condo Vultures� LLC.

Resale inventory in the tricounty region of Miami-Dade, Broward, and Palm Beach counties totals 70,067 residences as of Oct. 19, down 0.2 percent from a week earlier on Oct. 12 when there were 70,239 residential properties available, according to the report produced using Florida Association of Realtors data.

"South Florida residential resale inventory had been decreasing by more than one percent on a week-over-week basis," said Peter Zalewski, a principal with the Bal Harbour, Fla.-based real estate consultancy Condo Vultures�. "We think the resale inventory stickiness is due in part to less selection due resulting from the depleted inventory and the scheduled end of the $8,000 first-time home buyers credit that expires in November.

"We are also hearing from some buyers who are concerned about a second wave of foreclosures hitting the South Florida market in the upcoming months."

Florida Condos In 'Downward Spiral' As Banks Ignore Losses

Wed, 21 Oct 2009 12:25:52 -0400

BY GRANT STERN
Guest Column

Our condominium housing stock in Florida is stuck in quicksand.

While the sinking feeling is lightening up, most of the market is stuck at the bottom of the bust cycle where units are difficult to sell or finance and associations are struggling to afford basic services and there's no end in sight.

The main reason why condos are stuck in downward spirals is lien-holder and bank resistance to realizing losses. The micro-workout policies promoted by banks will prolong the pain indefinitely at current rates of progress, which may have been acceptable 20 years ago, but now threaten to sink any recovery's long-term prospects.

The lack of mortgage money is intensifying the pain by wrecking valuations across the board. Furthermore, these types of events create recognized paradoxes. Ultimately, removing some of the current condominiums - the uninsured, poorly managed, or flat out falling-apart projects - must be effected to restore equilibrium to the greater market as a whole.

Banks are attempting to spread their losses over many years rather than realizing them immediately, which is only causing broader losses as the market flags and more loans in neighboring associations slide away as foreclosures slowly sap the value from entire communities.

Related Group Slashes Prices 30% At ICON Brickell

Tue, 20 Oct 2009 14:44:34 -0400

Prices at ICON Brickell, a signature three-tower condo complex in Greater Downtown Miami , have been slashed by 30 percent and in-house financing is now available, according to the Miami Herald.

With only 58 units closed at the 1,808-unit ICON Brickell, The Related Group with developer Jorge Perez has convinced its construction lenders to discount pricing for original contract holders who have yet to close, according to the Condo Vultures� Official Condo Buyers Guide To Miami�.

Bolstering the Related Group's effort is a new financing options being provided by the ICON Brickell's construction lenders, led by Bank of America, HSBC, and Wells Fargo. The in-house financing packages offer fixed interest rates for five-year terms.

"All of the closings at ICON Brickell to date have occurred in the project's north tower that has 713 units and more than 830,000 square feet of saleable space," said Peter Zalewski, a principal with the Bal Harbour, Fla.-based real estate consultancy Condo Vultures� LLC. "Even if this new program spurs a complete sellout of the north tower, the developer still has his hands full with two additional towers that feature nearly 1,100 units with 1.3 million square feet of saleable space.

"The ICON Brickell is going to take some time to get under control but at least the process of stabilizing this project has begun."

South Florida REOs Rise 16% In Q3 2009

Fri, 16 Oct 2009 14:05:13 -0400

Lenders repossessed 16 percent more South Florida properties in the third quarter of 2009 than a year earlier, spurred by a double-digit percentage increase in Broward County that offset decreases in Miami-Dade and Palm Beach counties, according to a new report from the Condo Vultures� Foreclosure Database�.

At this pace, South Florida is on track to realize nearly 29,000 repossessions, which would be a nine percent year-over-year increase compared to 2008 when lenders repossessed 26,240 properties. In 2007, lenders repossessed 10,087 properties in South Florida, according to the Condo Vultures� REO Report� compiled using court records.

"On one hand, the number of REOs will continue to rise in unison with the number of foreclosure actions - on pace for nearly 100,000 in 2009 - being filed in South Florida," said Peter Zalewski, a principal with the Bal Harbour, Fla.-based real estate consultancy Condo Vultures�. "On the other hand, the pool of buyers for REOs is extremely deep in South Florida despite the challenges of obtaining financing in today's market."

The REO designation - a bank term for a repossessed or foreclosed real estate - is cast upon a property when the title is transferred by the court to the lender from the borrower for nonpayment of debt service upon completion of the foreclosure process.

Another South Beach Condo Project Being Foreclosed

Thu, 15 Oct 2009 15:50:07 -0400

BY JOHN FAKLER
Executive Editor
CondoVultures.com

The developers of South of Fifth Condominium and the Caribbean Miami Beach are the recipients of foreclosure actions this month, totaling more than $129 million.

The South of Fifth condo complaint was filed Oct. 1 for $78.9 million against BR Villa Luisa LLC and guarantors Michael Samuel, R. Ramin Kamfar, Ramano C. Tio and Marc Sznajderman, according to the South Florida Business Journal, citing Miami-Dade County Circuit Court records.

The developer of the Caribbean Miami Beach, an oceanfront condo in South Beach is being foreclosed upon by 3737 Caribbean Partners, the new owner of the construction loan that was originally funded by the failed Corus Bank, according to a report by CondoVultures.com. The 3737 Caribbean Partners entity was the winning bidder, purchasing the loan for a reported $50 to $55 million from Corus, according to the South Florida Business Journal. The project's developer, Caribbean Group Owners is named in the lis pendens filing that was processed Oct. 5 in Miami-Dade Circuit Court. A lis pendens is the first step in the foreclosure process.

International Seminar Series Launches Tonight In Colombia

Wed, 14 Oct 2009 14:06:31 -0400

More than 60 people are expected to turn out tonight in Bogota, Colombia, to learn from Condo Vultures� about the latest buying trends in South Florida�s real estate market.

Condo Vultures� founder Peter Zalewski will open the first-ever Condo Vultures� seminar overseas with a presentation examining South Florida�s real estate market with an emphasis on condominium trends. Zalewski�s presentation will be complemented by two experts with sister company, Condo Vultures� Realty LLC.

Jenny Huertas, the international sales director of Condo Vultures� Realty, is scheduled to follow Zalewski with a discussion on individual sales and financing trends, scenarios, and challenges in Greater Miami. Daniel Jaramillo, who specializes in multihousing at Condo Vultures� Realty, will round off the discussion with a look at bulk condo buying scenarios in South Florida.

�Investors from Latin America, and Colombia in particular, are historically interested and active in the South Florida real estate market,� said Zalewski, who is a principal with the Bal Harbour, Fla.-based real estate consultancy Condo Vultures� . �Given the strong interest coming from Colombia, we feel that Bogota is an ideal place for Condo Vultures to launch its international seminar series. We hope to host additionally international seminars around the Americas and Europe in the upcoming months.�

South Florida Contracts Jump 2% Led By Palm Beach County

Mon, 12 Oct 2009 22:12:47 -0400

BY JOHN FAKLER
Executive Editor
CondoVultures.com

Pending deals for residential resale product rose by two percent on a week-over-over week basis to 18,044 deals in the tricounty South Florida region, more than doubling the percentage increase in contracts since Oct. 5, according to a new report from Condo Vultures� LLC.

Palm Beach County, where Boca Raton, West Palm Beach, and Boynton Beach are located, led the pace by adding three percent in the last seven days to 2,676 contracts as of Oct. 12 compared to 2,599 contracts on Oct. 5, according to the report produced using Florida Association of Realtors data.

Contracts also increased in Broward County, where Fort Lauderdale, Hollywood, and Pompano Beach are located, by two percent to 7,319 pending deals. Pending sales in Miami-Dade County, where Miami Beach, Coral Gables, and Sunny Isles Beach are located, grew by 1.6 percent to 8,049 contracts, according to the report.

Lender Files To Foreclose Oceanfront Miami Beach Condo

Fri, 09 Oct 2009 16:48:52 -0400

The developer of the Caribbean Miami Beach oceanfront condominium in South Beach is being foreclosed upon by the new owner of the construction loan that was originally funded by the failed Corus Bank, according to the Condo Vultures� Foreclosure Database�.

The South Beach project's developer, Caribbean Group Owners, is named in a lis pendens filing - the first step in the foreclosure process - processed on Oct. 5 in Miami-Dade Circuit Court. The Caribbean Group Owners is a partnership between Christa Development and Bluerock Real Estate.

The foreclosure filing was initiated by the new owner of the construction loan - 3737 Caribbean Partners LLC - some six weeks after purchasing the remaining balance on the $128 million construction loan, according to a recent CondoVultures.com report. Leon and Alfonse Melohn of Melohn Properties in New York City and Michael Konig are members in the recently created Florida entity 3737 Caribbean Partners LLC.

"The lender is taking the necessary legal steps in hopes of repositioning this luxury South Beach project for a likely retail sellout," said Peter Zalewski, a principal with the Bal Harbour, Fla.-based real estate consultancy Condo Vultures�. "It is a stretch but ideally the lender would like to have the issue resolved to take advantage of the strong appetite for discounted, quality condo units in South Florida, and especially South Beach. Once this project is brought to market, watch for the units to retrade at a strong clip if the pricing is appropriate. "

Developers Sell 900 Condos In 90 Days In Downtown Miami

Thu, 08 Oct 2009 15:22:40 -0400

Developers sold more than 900 condo units at a price of over $250 million in Greater Downtown Miami in the third quarter of 2009, representing a 278 percent increase in sales activity from the previous quarter, according to a new White Paper report from Condo Vultures� LLC.

Buyers purchased 929 units for $253 million in the 60-block stretch of Greater Downtown Miami between July and September at an average price of more than $272,300 per unit, according to the Condo Vultures� Official Condo Buyers Guide To Miami�.

Greater Downtown Miami's unsold inventory as of Sept. 30, 2009 totals just under 8,500 units, a 20 percent decrease from a year earlier when there were nearly 10,600 developer units available.

"Investors and to a lesser extent primary users purchased an average of 10 units per day in Greater Downtown Miami during the last quarter," said Peter Zalewski, a principal with the Bal Harbour, Fla.-based real estate consultancy Condo Vultures�. "Bolstering the third quarter sales volume was the activity of the elusive bulk buyers who finally began to acquire, picking off 277 units in Greater Downtown Miami for $46 million."

Zalewski is scheduled to discuss the third quarter Miami condo results and future trends at the next Condo Vultures� Seminar Series on Oct. 27 at the Doubletree Grand Hotel in Downtown Miami.

The program, "Miami's Condo Trends In Q3 and Beyond," begins at 5.30 p.m. and features a networking session and question and answer period. For more information, contact executive editor John Fakler at 800-750-0517 or jfakler@condovultures.com.

Starwood Emerges As Downtown Miami's Condo Market Maker

Wed, 07 Oct 2009 15:17:46 -0400

Starwood Capital paid a reported 69 cents on the dollar for the $4 billion condo construction loan portfolio of the failed Corus Bank and in doing so emerged as Greater Downtown Miami's new condo market maker.

Starwood Capital's winning bid of $2.77 billion is reportedly 20 percent more than the next closest bid received by the Corus Bank's receiver, the Federal Deposit Insurance Corp.

Before its Sept. 11 failure, Corus Bank was the third largest condo construction lender in South Florida behind only Bank of America and the failed Wachovia Bank. Corus also financed an array of condo projects in other boom-and-bust markets such as Las Vegas, and San Diego.

In completing the deal, Starwood acquires existing construction loans on a dozen projects secured by more than 2,300 condo units in the tricounty South Florida region of Miami-Dade, Broward, and Palm Beach counties, according to a recent CondoVultures.com report.

"What this means for South Florida is, the condominium projects financed by the failed Corus Bank can now be reduced on average by more than 30 percent if Starwood Capital feels compelled to do so," said Peter Zalewski, a principal with the Bal Harbour, Fla.-based real estate consultancy Condo Vultures� LLC. "This acquisition gives Starwood Capital - which now controls 21 percent of the unsold condos in Greater Downtown Miami - the ability to influence or undercut every development in town."

South Florida Contracts Tumble 1%

Tue, 06 Oct 2009 16:30:19 -0400

Pending deals for residential resale product fell by 1 percent on a week-over-over week basis to 17,694 deals in the tricounty South Florida region, marking the first drop in contracts since July, according to a new report from Condo Vultures� LLC.

Palm Beach County, where Boca Raton, West Palm Beach, and Boynton Beach are located, fell by 4.4 percent in the last seven days to 2,599 contracts as of Oct. 5 compared to 2,718 contracts on Sept. 28, according to the report produced using Florida Association of Realtors data.

Contracts tumbled in Broward County, where Fort Lauderdale, Hollywood, and Pompano Beach are located, by 0.4 percent to 7,173 pending deals. Pending sales 922 in Miami-Dade County, where Miami Beach, Coral Gables, and Sunny Isles Beach are located, slipped by 0.3 percent to 7,922 contracts, according to the report.

"For the first time since July 7 the number of pending contracts fell on a week-over-week basis," said Peter Zalewski, a principal with the Bal Harbour, Fla.-based real estate consultancy Condo Vultures�. "In the last week, single-family houses slipped by 2 percent, dragging down the overall drop in pending sales. Contracts for condos - the region's Achilles heel due to overbuilding - and townhouses are surprisingly steady.

"If this continues, we may be seeing early signs that the buyers are growing disinterested in the available inventory."

Greenwich Fund Favorite To Buy Corus Portfolio

Mon, 05 Oct 2009 12:52:43 -0400

Starwood Capital is the favorite to purchase the $4 billion real estate portfolio, which includes more than 2,300 unsold condo units in South Florida alone, of the failed Corus Bank from the Federal Deposit Insurance Corp, according to the Wall Street Journal.

Starwood Capital, a private investment firm based in Greenwich, Conn., has completed more than 300 deals with an asset value of more than $20 billion since its inception in 1991. Starwood Capital raised $950 million this summer with an Initial Public Offering for a real estate opportunity fund called the Starwood Property Trust (NYSE: STWD).

If Starwood Capital turns out to be the suitor of the Corus portfolio, the firm headed by chairman Barry S. Sternlicht would have beaten out several qualified bidders, including a pair of firms with strong South Florida ties - The Related Group and Crescent Heights - that were vying for what may be the most attractive residential portfolio of this real estate market crash.

"Corus Bank's condo construction loan portfolio represents 17 percent of the unsold developer units in the overbuilt Greater Downtown Miami," said Peter Zalewski, a principal with the Bal Harbour, Fla.-based real estate consultancy Condo VulturesCondo Vultures� LLC. "We expect the purchaser of the Corus portfolio to implement several strategies to deal with the overwhelming number of condo units scattered across the country that will be acquired. One strategy that is expected to be adopted is a fire sale approach where units are discounted below current market to move product quickly.

"The discount being offered by the FDIC makes this approach viable."

New Michael Moore Movie Criticizes Condo Vultures�

Fri, 02 Oct 2009 13:19:37 -0400

Condo Vultures� founder Peter Zalewski is preparing to be criticized on the big screen with tonight's Miami premiere of award-winning director Michael Moore's new film "Capitalism: A Love Story."

Moore, who calls capitalism "evil", profiles Zalewski and his opportunistic brokerage firm that specializes in buying up and reselling distressed properties in the new documentary. Moore's film examines how Wall Street greed combined with the Bush administration's policies permitted the 2008 financial meltdown to occur, clearing the way for companies such as Condo Vultures� to benefit.

"Several scenes in the movie involving Zalewski have fueled the ire of West Coast movie reviewers and bloggers," said John Fakler, the executive editor of CondoVultures.com. "But the way Zalewski sees it, what has transpired in South Florida and the rest of the nation is 'Straight-Up Capitalism.'"

Condo Vultures� Realty, the sister company of Condo Vultures� LLC which operates CondoVultures.com, is featured in the first half of the new film that explores corporate greed in America.

Zalewski will be on hand for a question-and-answer session following the screening that begins at 7.30 pm Friday, Oct. 2, at the Sunrise Cinema Intracoastal Mall theater on 163rd Street in North Miami Beach immediately west of the Intracoastal Waterway and Sunny Isles Beach.

Discounted tickets and concessions will be offered to Condo Vultures� patrons at the door. An RSVP is required.

An after party is scheduled immediately following the showing of the two-hour movie. The after party (and Q&A session) will be held at 10 pm at Racks Italian Bistro, located at the opposite end of the movie theater. The restaurant and bar features outdoor seating on the Intracoastal Waterway for all guests. There is no charge for the after party. There will be a cash bar, appetizers and a 25 percent discount for groups.

Bank Sells Position On Downtown Miami Tower

Thu, 01 Oct 2009 17:31:34 -0400

The remaining 96 percent of unsold residential units in the troubled Cynergi condominium tower in Greater Downtown Miami will soon have a new owner.

The newly created Miami corporation Wellmeaning Properties LLC has purchased the bid position of Cynergi's construction lender, Banco Popular North America, for the scheduled March 2010 foreclosure auction of the project located at 2700 N. Miami Ave. in the Biscayne Boulevard Corridor.

Banco Popular obtained a $30.6 million judgment from the Miami-Dade Circuit Court against the project's developer Cynergi 2700 LLC, with Davidson and Izhak Orgad of Hallandale Beach, according to Miami-Dade County records.

The Cynergi's remaining units will be auctioned in one transaction in an attempt to satisfy the judgment amount. The foreclosure process was initiated by Banco Popular against the developers of the Cynergi in June 2009, according to the Condo Vultures� Foreclosure Database�.

If the property does not receive a bid of at least the judgment amount, Wellmeaning Properties, with members Hugo Amaya and Icente Carrillo, would take ownership of the remaining 96 residential units in 100-unit residential tower located near the massive Midtown Miami residential and retail complex.

Palm Beach Tops South Florida For Available House Inventory

Wed, 30 Sep 2009 15:34:45 -0400

Palm Beach County, the smallest populated county in the South Florida region, now has more single-family houses for resale than the much larger neighbors to the south Miami-Dade and Broward counties, according to a new report from Condo Vultures� LLC.

Palm Beach County, a county with 1 million people that is home to Boca Raton, Delray Beach, and West Palm Beach, has 9,787 single-family houses for resale as of Sept. 28, representing 35 percent of the total South Florida inventory of 27,580, according to the report produced using Florida Association of Realtors data.

By comparison, Miami-Dade County, which has an estimated 2.5 million people and is home to Miami Beach, Aventura, and Coral Gables, has 9,390 houses for resale, representing 34 percent of the region's inventory.

Broward County, home to 2 million people and the cities of Fort Lauderdale, Hollywood, and Plantation, has 8,403 houses for resale, representing 30 percent of the available inventory, according to the report.

"Palm Beach County's real estate market has been behind the curve in terms of purchases and stabilization," said Peter Zalewski, a principal with the Bal Harbour, Fla.-based real estate consultancy Condo Vultures�. "The smaller population combined with the investor focus on Miami-Dade and Broward counties has contributed to the lesser demand for Palm Beach County residential resale inventory."

Michael Moore Movie Premiere In Miami To Feature Q&A Session

Tue, 29 Sep 2009 13:45:45 -0400

The Miami premiere of award-winning director Michael Moore's new film "Capitalism: A Love Story" will feature a questions and answers period after the showing with one of the co-stars of the movie, Condo Vultures� Founder Peter Zalewski.

The opening night schedule calls for a 6.30 pm preshowing party Friday, Oct. 2, (and a 7.30 pm showing) at the Sunrise Cinema Intracoastal Mall theater on 163rd Street in North Miami Beach immediately west of the Intracoastal Waterway and Sunny Isles Beach.

"Several scenes in the movie involving Zalewski have fueled the ire of West Coast movie reviewers and bloggers," said John Fakler, the executive editor of CondoVultures.com. "But the way Zalewski sees it, what has transpired in South Florida and the rest of the nation is 'Straight-Up Capitalism.'"

Condo Vultures� Realty, the sister company of Condo Vultures� LLC, is featured in the first half of the new film that explores corporate greed in America.

Bankrupt Condo Towers Latest Trend In Real Estate Meltdown

Mon, 28 Sep 2009 15:13:29 -0400

BY GRANT STERN
Guest Column

What happens when condominium towers go bankrupt? It's a looming question being asked by homeowners, investors and even many property management professionals.

The primary forms of resolution for failing condominiums are bankruptcy and receivership which can be used separately or in combination.

Thanks to recent court decisions, there is even a Blanket Receivership which is sweeping through condominium associations statewide to mitigate losses.

There are different ramifications for developer controlled homeowner associations as opposed to associations in control of the individual members.

Ultimately, the goal of the workout process is to return the association to its members, while ensuring that all of the creditors are paid, vital services are available and regular maintenance is performed or brought current.

Miami, Las Vegas, San Diego: A Tale of 3 Condo Markets

Fri, 25 Sep 2009 14:03:03 -0400

As the Miami real estate market shows signs of stabilizing in certain submarkets, the situation could not be more different in the two other U.S. condo markets that experienced a similar volume of vertical construction during the boom: Las Vegas and San Diego.

This is the assessment of Condo Vultures� founder Peter Zalewski after spending 10 days in Las Vegas and San Diego visiting more than 30 new condo projects that have failed to sell out. Zalewski visited the projects unsolicited and unannounced to gather market intelligence on pricing, product quality, and local professional insight.

"We see a lot of similarities in the Las Vegas condo market today that reminds us of market conditions in Miami in autumn 2008," said Zalewski, who is a principal with the Bal Harbour, Fla.-based real estate consultancy Condo Vultures� LLC. "Our impression of San Diego - where some of the new towers are just now opening - reminds us a lot of Miami in late 2007. Overall, we think the price declines that have already been realized in Miami will be experienced in the near future in Las Vegas and San Diego."

Condo Contracts Jump 2.9% In South Florida

Thu, 24 Sep 2009 13:56:22 -0400

Contracts on condominium units and townhouses in South Florida spiked 2.9 percent in the last week to more than 9,000 pending sales in the tricounty region of Miami-Dade, Broward, and Palm Beach counties, according to a new report from Condo Vultures� LLC.

Contracts on condo units and townhouses are up 103 percent in the last 10 months to 9,019 pending sales as of Sept. 21 compared to 4,434 potential deals on Nov. 24, according to the report produced using data from the Florida Association of Realtors.

By comparison, pending sales for single-family houses in that time period are also up, rising 77 percent in the last 10 months to 8,593 contracts as of Sept. 21 compared to 4,868 deals on Nov. 24, according to CondoVultures.com.

"As the single-family house inventory is depleted, more first-time home buyers and investors are looking to condominium units and townhouses as a viable alternative especially as the condo prices have come down," said Peter Zalewski, a principal with the Bal Harbour, Fla.-based real estate consultancy Condo Vultures�. "Condos and townhouses now represent 61 percent of the overall South Florida inventory compared to about 57 percent back in November 2008."

South Florida now has 71,712 residences for sale in South Florida with condos and townhouses accounting for 43,910 available resales and single-family houses the remaining 17,612 inventory.

Downtown Miami Land Trades For $39 Million

Wed, 23 Sep 2009 15:28:27 -0400

A Boca Raton company has paid $39 million for nearly 300,000 square feet of vacant land situated on nine parcels in Downtown Miami, according to a new report from the Condo Vultures� Bulk Deals Database.

The newly created PWV Group 1 Holdings LLC, with Gary N. Gerson as registered agent, paid $130 per square foot on Sept. 21 for 27 lots located a block west of four new highrise condo towers on Downtown Miami's Biscayne Boulevard, according to CondoVultures.com research.

The seller, six corporations controlled by AI Holdings (USA) Corp with Tamir Kazaz as chief financial officer, paid a combined $32.3 million, or $108 per square foot,� for the land, which was acquired between August 1999 and March 2006, according to Miami-Dade County records.

The powerful Africa Israel fund controls AI Holdings (USA) Corp, according to a notarized document recorded with the deed.��

"The purchase price works out to a gross premium of 21 percent for the seller minus expenses, and there have been many of them," said Peter Zalewski, a principal with the Bal Harbour, Fla.-based real estate consultancy Condo Vultures� LLC. "For the buyer, the purchase price is 8 percent less than today's assessed value of $41.6 million, or $139 per square foot, for property tax purposes."

Chinese Drywall Expert Panel Discussion Set for Today

Tue, 22 Sep 2009 12:05:15 -0400

A trio of experts in defective Chinese Drywall have confirmed their participation as panelists for Condo Vultures� upcoming "Chinese Drywall Trends In South Florida Real Estate" seminar on Sept. 22 from 5:30 pm to 8 pm at the Doubletree Grand Hotel just north of Downtown Miami.

Attorney Allison Grant of the law firm of Shapiro, Blasi, Wasserman & Gora, PA , environmental engineer Jay Sall of Environmental Engineering & Consulting Services (EE&G); and Chinese Drywall remediator Howard Ehrsam of Chinese Drywall Screening LLC will discuss issues and concerns regarding the construction material.

Chinese Drywall is a concoction of gypsum mixed with other ingredients that can put off an unpleasant sulfur smell, triggers nosebleeds and headaches, and causes metal to corrode.

The program will focus on the growing problem from an investor�s perspective.

South Beach Complex Trades For $98,000 Per Unit

Mon, 21 Sep 2009 10:36:08 -0400

A new Miami Beach corporation has purchased a 24-unit apartment complex in the trendy South Beach neighborhood for $98,000 per door, according to a new report from Condo Vultures� LLC.

The newly created 1941 Park Ave LLC, with Ishai Ben Zour as managing member, purchased the Barclay Plaza apartment complex with 13,072 square feet of livable space for $2.35 million, or $180 per square foot.

"The new owner can rent the units out for about $2 per square foot per month in the short term," said Peter Zalewski, a principal with the Bal Harbour, Fla.-based real estate consultancy Condo Vultures�. "Located between the Miami Beach Convention Center and the new W South Beach and Setai resorts, the owner may want to renovate the project and convert the apartments into condominium units sometime in the future."

Failed Bank's Miami Portfolio Stands At 2,300 Unsold Units

Fri, 18 Sep 2009 03:16:35 -0400

Nearly 2,300 condominium units built in South Florida by developers using construction loans provided by the recently closed Corus Bank remain unsold, according to a new white paper report from Condo Vultures� LLC.

Developers of nine projects with a combined loan amount of $1.2 billion have not yet closed 2,299 units, or 76 percent, out of the 3,035 total units constructed in South Florida using Corus financing, according to the report produced using public and private records.

"The Corus Bank failure has many opportunity funds salivating in South Florida," said Peter Zalewski, a principal with the Bal Harbour, Fla.-based real estate consultancy Condo Vultures�. "When regulators announced they would be absorbing a $1.7 billion loss related to the Corus failure, many funds immediately realized that the gap between the ask price and the bid price could be bridged."

Corus Bank, the third largest condo construction lender in South Florida during the latest boom, was shut on Sept. 11 by regulators who stormed the 96-year-old institution's headquarters on Chicago's north side.

The Federal Deposit Insurance Corp, which insures accounts up to $250,000, was appointed the receiver to oversee the liquidation of Corus' $7 billion in assets and $7 billion in liabilities.

The FDIC has already sold off Corus' deposits and $3 billion of its assets to MB Financial in Chicago, leaving $4 billion in primarily commercial loans - including condominium construction loans in South Florida, Las Vegas, San Diego, and elsewhere.

Note Sale Occurs For Downtown Miami Condo Tower

Wed, 16 Sep 2009 14:44:08 -0400

A Miami development and management company has purchased at a deep discount the outstanding debt of a construction loan for the troubled 28-story Onyx on the Bay condominium tower in Greater Downtown Miami from the recently closed Corus Bank.

In purchasing the note secured by 40 unsold units, the buyer, Hyperion Onyx Partners LLC with Scott Bloom as a member, steps in the place of the lender that initiated foreclose proceedings against the project in May 2009.

Hyperion Onyx Partners, a newly formed Florida corporation with ties to the Miami-based Hyperion Development Group that developed more than 1,000 condo units in Greater Downtown Miami, paid an undisclosed price - rumored at $155 per square foot - for the outstanding balance on the original $46.1 million construction loan - or an average of $303 per square foot - provided in October 2004.

The assignment of the Corus Bank construction loan has not yet been recorded in Miami-Dade County, according to research by Condo Vultures� LLC.