Category Archives: Miami Real Estate News

Former Versace Home Lists for $125M

June 08, 2012 03:00PM

Casa Casuarina The late designer Gianni Versace’s former Miami Beach home Casa Casuarina is on the market asking $125 million, according to the Wall Street Journal. The 10-bedroom, 11-bathroom, 19,000-square-foot estate was purchased by Versace in 1992 for close to $10 million. The designer had made $33 million in renovations to the property, adding a 6,100-square-foot south wing, a 54-foot-long mosaic-tiled pool lined with 24-karat gold and a courtyard before he was murdered outside the house in 1997. The mansion, which is located at 1116 Ocean Drive in South Beach, has since been converted to a hotel and restaurant by Peter Loftin, a telecom entrepreneur. It is now called the Villa by Barton G. Loftin purchased the house in 2000 for $20 million. Jill Eber and Jill Hertzberg of Coldwell Banker are marketing the property. [WSJ]

Bulk Condo Rule Extended for 3 Years…

TALLAHASSEE, Fla. – April 12, 2012 – In most cases, people who purchase condominium units from bulk buyers won’t be able to sue them if there are construction defects or other problems.
Florida Gov. Rick Scott last week signed a bill that extended the protections for investment groups that have bought multiple units in a building. That means the investors don’t have any more responsibility than other buyers in the building.

The measure went into effect July 1, 2010, and Scott extended it for three more years until July 2015.

The exemption for bulk buyers boosted sales of distressed condos, helping the housing market recover, proponents say. Critics insist the measure isn’t consumer-friendly and shouldn’t become law permanently.

Florida law used to consider a developer anyone who bought more than seven units in a building of 70 units or more. Those buyers were forced to assume the same legal and financial risks as developers who build condos.

The bill eliminated the title of developer for bulk buyers, giving investment groups more incentive to make deals for deeply discounted units.

While investors scooped up South Florida condos, “a lot of other areas in Florida are having problems in terms of absorbing unsold units,” said Marty Schwartz, a Miami lawyer and a co-sponsor of the bill.

Some investor groups have proposed making the bill’s protections permanent.

“I still think there’s a need for it, but only for a limited period of time,” said Donna DiMaggio Berger, a Broward County lawyer who represents condo associations statewide. “Why would we want to make it permanent when the (housing) market is no longer distressed?”

From late 2008 until September 2011, investor groups made more than 100 bulk deals for condos in Palm Beach, Broward and Miami-Dade counties, according to CondoVultures.com, a Bal Harbour-based consulting firm. The total dollar value was nearly $3 billion.

Copyright © 2012 the Sun Sentinel (Fort Lauderdale, Fla.), Paul Owers, Sun Sentinel, Fort Lauderdale, Fla. Distributed by MCT Information Services.

Commercial Investors Eye Single-Family Homes

Commercial Investors Eye Single-Family Homes

Published on: Wednesday, March 07, 2012

Written by: David Bodamer

 U.S. federal agencies are casting about for ways to pull the country’s housing market from the brink as reports from the Case-Schiller National Index indicate housing price falls for the eighth straight month. The Federal Housing and Finance Agency has announced a pilot program that will allow commercial investors to buy foreclosed single-family homes in bulk. The plan has several high-profile backers who are anxious for the opportunity to bid on these properties. Once purchased, the properties could be rented out or resold. For more on this continue reading the following article from National Real Estate Investor

With the latest data from the Case-Shiller National index showing that housing prices have fallen for the eighth straight month and are now back to January 2003 levels, the housing crisis appears no closer to its end.

But might there be an unlikely savior on the horizon for the single-family sector in the form of commercial real estate investors? On Monday, the Federal Housing Finance Agency (FHFA) announced a pilot program through which it would take bids from investors to buy foreclosed residential properties in bulk for the purpose of turning them into rentals.

The pilot program is the result of an effort launched last summer by the FHFA, along with the Treasury Department and the Department of Housing and Urban Development, to solicit outside input on how the government could deal with its millions of real estate owned (REO) residential assets and help turn the housing market around. The first pool of assets is a group of 2,490 properties, including 2,849 units in some of the hardest-hit residential markets: Atlanta, Chicago, Florida, Las Vegas, Los Angeles and Phoenix. There are 1,743 single-family homes, 527 condos, seven manufactured homes, one co-op, 118 duplexes, 36 three-unit buildings and 58 four-unit buildings.

To date, investors have purchased homes in foreclosure auctions and rented them out. But investors can only buy one or two assets at a time this way. The idea here is to enable investors to buy larger pools of foreclosed homes in order to get them on the market as rentals and deal with the glut of troubled assets more quickly.

“This is another important milestone in our initiative designed to reduce taxpayer losses, stabilize neighborhoods and home values, shift to more private management of properties and reduce the supply of REO properties in the marketplace,” FHFA Acting Director Edward J. DeMarco said in a statement.

Investors must fill out a qualifying form on the FHFA’s REO Asset Disposition page, post a security deposit and sign a confidentiality agreement to access detailed information about the properties. According to the FHFA, only investors who qualified through this process will be eligible to bid.

INITIATIVE’S BACKERS

The concept of involving the private sector to help solve the foreclosure problem has some high-profile backers.

REO Loan Count

Lew Ranieri, who helped pioneer mortgage-backed securities in the 1970s, and Kenneth Rosen, chairman of real estate market research firm Rosen Consulting Group, are the main authors on a policy paper issued this monthlaying out how the private sector’s involvement could help turn around the housing market and deliver attractive returns to investors.

“Without question, this is an opportunistic place to make investments,” Rosen says. “It’s similar to what opportunity funds have done with commercial real estate. There are more than one million units to be auctioned. Instead of having small players buy the assets, this would allow for bulk acquisitions.”

Overall, 453,266 residential units are currently classified as REO. Of those, the federal government holds nearly 50 percent of the inventory through Fannie Mae and Freddie Mac and another 9 percent with the Federal Housing Administration. In addition, private label securities hold 33.3 percent of the REO inventory and banks hold 17.5 percent.

But gaining control of those assets is a time-consuming process. In existing auctions, properties are sold one at a time. Private equity investors have gotten involved in converting vacant homes into rental properties, according to Rosen. But creating bulk programs could increase interest by making it easier for large investors to amass portfolios.

Investors then have several strategies for how to handle the assets. According to the policy paper, “Homes can be purchased for three potential outcomes, depending on a range of factors: the micro-conditions of the home, employment and income of potential tenant/owners and the macro-conditions of the neighborhood and market.” Specifically, investors could choose to offer the units in rent-to-own, rent-to-rent or resale arrangements.

In a rent-to-own scenario, an investor would enter a long-term relationship with a tenant who would offer the renter a right-of-refusal to buy the home. The lease could also be structured to give the tenant a share of any upside in a property’s sale. According to the policy paper, “This share can be structured to be payable regardless of whether or not the tenant purchases the home or be restricted to only if the tenant converts to ownership. This share can be pro-rated down or eliminated if a tenant leaves before the ?ve-year term.”

REO Investor Options

In a rent-to-rent scenario, the investor operates the asset as a straight rental property. And a resale would simply involve moving the asset to an owner-occupier.

“The private sector has a lot of solutions to the mortgage problem,” Rosen says. “They are engaged and want to be involved. I think this is something that has to be pushed as fast as it can.”

One caveat Rosen notes is that the government needs to ensure that the participants in the program are legitimate players. For example, the policy paper notes, “Programs that we deem to be unscrupulous are requiring tenants to pay a down-payment when signing a lease. We believe ?rst and last month’s rent and/or a security deposit in keeping with state law is acceptable, but do not believe additional advance payments are warranted.”

If all goes well, Rosen thinks the pilot program could be expanded “full scale” within a year with the government offering its inventory in bulk sales as well as banks and private-label securities conducting similar programs.

This article was republished with permission from National Real Estate Investor.

Most of Swire’s Brickell CitiCentre to finish by 2015

Most of Swire’s Brickell CitiCentre to finish by 2015

South Florida Business Journal by Oscar Pedro Musibay, Reporter

Date: Thursday, March 8, 2012, 7:04am EST

Most of the Brickell CitiCentre project is scheduled to be completed by 2015.
As work crews continue testing and prepping the site in Miami where Swire Properties is planning Brickell CitiCentre, the developer announced it has received a $140 million credit facility to fund operations and the initial development cost.

HSBC Bank USA is providing the credit facility, which Swire said would allow the developer to do more design, development and cover the initial construction costs, according to a statement released Tuesday.

The six-building project is planned for 9.1 acres between Brickell Avenue and South Miami Avenue, from Southeast Sixth Street to Southwest Eighth Street.

Located in the center of Miami’s financial district, Brickell CitiCentre will include 520,000 square feet of shopping and dining, three office buildings, two residential towers and a 243-room hotel with 93 apartments.

The project will be developed in two phases, with all elements of the first phase, except for one office tower, scheduled for completion in 2015.

The first phase will have about 4.3 million square feet, including 520,000 square feet of retail shops, 800 condominium units, 243 hotel rooms, 93 serviced apartments, two office towers of 110,000 square feet each and 3,100 parking spaces.

A Feb. 15 news release said the third office tower would be completed by 2018, but the Tuesday release said market conditions would determine when the 750,000-square-foot structure would be built.

“Miami’s economy is benefiting from investments by its neighbors from South America, and we see strong growth potential for the city,” Swire Properties CEO Martin Cubbon said in the Tuesday release. “The location of Brickell CitiCentre offers an excellent opportunity to draw market share from local businesses and residents as well as visitors.”

Swire Properties is the U.S. subsidiary of the Hong Kong-based Swire Properties Ltd.

In September, the Business Journal reported that the developer planned to dedicate 95,000 square feet of the project to medical offices and a wellness center.

Oceana Key Biscayne Breaks Ground at the Former Site of the Sonesta Hotel

From: World Property Channel
By: Michael Gerrity
February 15, 2012

(MIAMI, FL) — Despite a national U.S. housing crisis still in play, the Miami condo boom is back with a vengeance On February 14, 2012,  another groundbreaking ceremony was held for the newly announced Oceana, the first U.S. real estate development of Argentina-based developer Consultatio.

Marcos Corti-Maderna of Consultatio Key Biscayne, LLC, Key Biscayne Mayor Frank Caplan and Eduardo Constantini of Consultatio Key Biscayne, LLC at the groundbreaking ceremony for Oceana Key Biscayne.

Oceana will be an exclusive 142 condominium development with 12 luxury Villas adjacent, located on the last oceanfront site available on Key Biscayne. This will be a state of the art project; Units will range from 1800 SF to 7500 SF, with a very low density (154 units on a 10.3 acres site).

Oceana Key Biscayne as seen from the Ocean

The new twin-tower Key Biscayne condo project is being touted by some local real estate brokers as the most exclusive new residential project in Miami since the condo boom five years prior.

Oceana is going to be built on the site of the former Sonesta Hotel, which was one of the first hotels in Key Biscayne. The 10.3 acre oceanfront site was acquired by Consultatio in September 2009 for $80 million, and the estimated total project cost will be over $250 million USD.

Due to the lack of land availability on Key Biscayne, there has not been any new real state development in the past 12 years.

Consultatio has hired Coastal Construction as their contractor, and continues working with their architectural firm Arquitectonica on finalizing project construction drawings. The developer plans to start selling the 154 condo units in the months ahead and is currently working on setting up their in-house sales team.

Key Biscayne is considered one of the most exclusive areas in Miami and has one of the highest incomes per capita in the United States.

Key Biscayne is also home to many internationally prominent residents, including A-list actor Andy Garcia, Miami Dolphin football great Nick Buoniconti and Latin American television celebrity El Gordo of El Gordo y La Flaca.

Eduardo Costantini, President of Consultatio said, “We are very excited with the excellent reception that Oceana has within the Key Biscayne community. The fact that we have government and community support is a very important reinforcement and also a commitment for the project to have the highest quality standards, respecting Consultatio’s philosophy.”

Consultatio is an experienced real estate developer from Argentina, with 30 years of experience developing large-scale master planned communities, commercial properties, and residential towers in high end international markets like Nordelta, Puertos del Lago, Las Garzas (Uruguay). The company is under the direction of its’ major share holder, president and CEO Eduardo F. Costantini, a prominent Argentinean businessman.

Swire Properties Plans $1Billion Development in Miami

Swire Properties plans $1 bln development in Miami

Dark clouds pass over the downtown of Miami, July 8, 2005. REUTERS/Carlos Barria

By Alex Frew McMillan

HONG KONG | Thu Feb 16, 2012 5:53am EST

(Reuters) – Newly listed developer Swire Properties Ltd said on Thursday that it plans to build a 2.9 million square foot project in Miami’s financial district.

The Hong Kong-based company had previously said in a filing that the development, Brickell CitiCentre, would cost about $1.05 billion.

It said the project would include three office towers, two residential blocks, 500,000 square feet of shopping and dining space, and a hotel, with construction expected to start in the second quarter.

Swire (1972.HK) bought four plots of land for project in 2008 and 2011, and through to September 2011 had spent $72.8 million on advance preparation of the site, including $69.4 million for the land.

Although Swire focuses on the core markets of China and Hong Kong, it has a 30-year track record in Miami, where it has been developing on an island called Brickell Key. It has hired Miami-based architects Arquitectonica to design the project.

Chairman Christopher Pratt said when Swire Properties listed in mid-January that the company had no immediate plans to raise capital, with the sale of its Festival Walk asset in Hong Kong providing adequate capital for its immediate plans .

One fund manager, who runs a $5 billion portfolio of actively managed property stocks in Asia, told Reuters this week that he expected Swire Properties to go to the equity or debt markets soon to fund expansion.

“Probably one year from now, they’ll raise money,” he said, declining to be identified as he was not authorised to talk to the media.

Swire Properties shares pared earlier losses on Thursday afternoon to trade down 0.8 percent compared with a 0.6 percent decline on the benchmark Hang Seng Index .HSI.

Tibor Hollo evicting Venezuelan Consulate

South Florida Business Journal

by Brian Bandell, Senior Reporter

Date: Friday, February 17, 2012, 1:47pm EST
Venezuelan President Hugo Chavez

Venezuelan President Hugo Chavez has directed his government to stop paying the rent on its Miami office.

It’s not often a landlord gets to evict a nation, but Tibor Hollo is doing just that to Venezuela and its consulate in Miami.

TWJ 1101 LLC, which owns the office building at 1101 Brickell Ave., filed an eviction lawsuit against the government of Venezuela, its economic development bank and its consulate office on Feb. 7. The building is owned by Florida East Coast Realty ,  led by Hollo, its president.

Venezuelan President Hugo Chavezannounced in January that he would close its consulate in Miami after Livia Acosta Noguera, its Miami consul general, was expelled from the U.S. She was subject to an FBI investigation over allegations that she was involved in a potential cyber-attack on the U.S. government – news unveiled by Univision.

Hollo said the Venezuelan officials have cleared out of his building and he hasn’t been able to contact them.

“Since January they haven’t paid rent, so I want to evict them,” he said. “The office is there. Nobody is in the office. All the furniture is there, but they aren’t there. I want my money or my space back.”

Hollo noted that Banco Industrial de Venezuela, a state-owned bank, is current on its lease payments for another suite in that building.

Having a bank office in Miami helps Venezuelans in South Florida with some financial transactions, but the loss of its consulate makes it harder for them to get documentation such as passports.

Given the eviction lawsuit, it looks like a Venezuelan Consulate in Miami won’t be reopened anytime soon.

Setai and Other Luxury South Beach Condos Headed to Foreclosure Auction

South Beach condo units set for auction

January 26, 2012 12:00PM

The Setai

A total of 48 condominium units in South Beach will be heading to auction in the next 30 days, with a number from high-profile projects like the Setai, Portofino and the Murano Grande, according to a report from Condo Vultures. The units hold a total of $14.5 million in final foreclosure judgements. A unit at the Setai is the highest-priced foreclosure judgment set for auction, at $2.5 million. The next-highest foreclosure judgment is on a unit at the Bentley Bay condo complex in South Beach. In December, a unit at the Setai sold for $21.5 million, one of the largest sales of 2011.  — Alexander Britell

South Florida’s Crisis in One Chart

The Miami Herald

South Florida’s real estate crisis in one chart

By DOUGLAS HANKS
dhanks@MiamiHerald.com

South Florida’s housing crash may be old news, but recent data offer some valuable perspective.The Federal Housing Finance Agency maintains appreciation indices for metropolitan areas, which are similar to the famous Case-Shiller index but more local. By stacking up Broward and Miami-Dade’s indices to the nation’s, the warning signs are hard to miss.

The chart anchors all three indices to the first quarter of 2000, so the numbers show appreciation since then. Real estate got out of hand across the country, with appreciation peaking nationally at 166 percent in 2007. But in Broward, values soared 272 percent. Miami-Dade did even better, up 283 percent.

It’s easy to see how quickly values collapsed, but the chart also points out something that tends to be overlooked amid the wreckage of real estate. Home values are still ahead of where they were in 2003.

But perhaps more surprising, local property has actually held its value better than the average home in the United States. According to the FHFA, the average U.S. home is worth about 40 percent more than it was at the start of 2000. In Broward, the average home is worth 49 percent more. In Miami-Dade, it’s 56 percent more valuable.

A sign of resiliency, or a hint that South Florida still has some dropping to do? We’ll probably find out this year.

The Miami Herald’s Economic Time Machine charts South Florida’s recovery from the Great Recession by comparing current conditions to levels set before the downturn.

The ETM crunches 60 local indicators to measure the economic activity, then finds when each indicator was at that level before the 2007-2009 recession. At the moment, the current economy most resembles where it was in June 2002. Visit miamiherald.com/economic-time-machine for updates and analysis of the latest economic data.