Condo owners are waging a fight against the powers that be.
Two ongoing legal fights underscore the precarious nature of fighting back against boards or authorities that act on behalf of condo buildings.
In one situation, a group of eight holdout owners at an aging, and now vacant, condo building in Miami’s Edgewater scored a win in their yearslong battle against Two Roads Development. An appeals court ruling earlier this month clarified voting rights within the condo association for the property, called Biscayne 21. The developer, Two Roads, paid $150 million for the majority of units in 2022, financed by Bank OZK, and launched sales of a new project planned for the site.
The story is more complicated than that, but Two Roads now plans to go to the Florida Supreme Court. The problem for Two Roads is that if the Supreme Court doesn’t hear the issue, or doesn’t rule in favor of the developer, then the unit owners will keep the leverage they just earned. And how much money can Two Roads afford to lose? Also, even if the unit owners end up victorious, will they move back into their building? That seems unlikely.
In another situation at 1060 Brickell, a two-tower, 592-unit condo complex, a group of owners are fed up with their board’s actions, including the passage of a $21 million special assessment. Owners I spoke with say they’ve spent more than half a million dollars on litigation tied to the board and its actions in recent months. They allege the work, which includes restoration and repairs, is unwarranted for a building that’s only 17 years old. The condo board president, meanwhile, says the work is necessary, and he won’t allow a Surfside collapse to happen there. Last week, state regulators ordered the existing board turn over control and records to a new board, but the current board could appeal.
Both fights highlight the issues of living in condo buildings. As a unit owner, you handed much of your power over to the people you elected to run your board. In an ideal situation, these are people who live in your building, or who have the building’s best interests in mind, and are following state law. But South Florida is filled with tens of thousands of condos, many owned by LLCs or absentee owners. Some owners and board members have ulterior motives. Others are just not qualified, and many still don’t understand or can’t keep up with the demands brought on by the condo safety legislation enacted after the deadly collapse in 2021.
Even if you buy a unit in a building with a great board, that can change in one election cycle. It’s kind of like finding insurance. You may have a great rate this year, and it doubles or triples the following year. But you have a 30-year mortgage. You’re stuck, unless you sell.
Regardless of who prevails in either situation, both “sides” believe they’re in the right, and both have spent too much money on legal fees. In the case of 1060 Brickell and a number of other condo communities across South Florida, owners are on the hook for double attorneys’ fees: for their lawyers and the lawyers their association boards pay for with the dues they collect.
The only way to really resolve these disputes is to go to court, which many people can’t afford, and that’s a problem.
What we’re thinking about: Will developer Michael Shvo be able to hang onto the Raleigh Miami Beach project? Send me a note at [email protected].
CLOSING TIME
Residential: Jerry Jordan, Jr., founder of Boston-based investment firm Hellman, Jordan Management Co., and his wife Darlene Jordan sold a single-family home at 203 South Lake Trail in Palm Beach for $86.5 million to a trust.
Commercial: Greystar purchased a 358-unit multifamily building at 6200 Northwest 173rd Street in north Miami-Dade County for $93.5 million. The seller was New York-based Nuveen Real Estate.
— Research by Mary Diduch
NEW TO THE MARKET
A unit at the planned Delmore Residences in Surfside hit the market for $40.2 million. Unit 702, a five-bedroom, five-and-a-half-bathroom condo, will be one of 37 units in the 12-story building at 8777 Collins Avenue. Damac Properties is the developer of the luxury condo project, planned for the site where Champlain Towers South collapsed in 2021. Damac acquired the property via a court-ordered auction in 2022. Tara West of Douglas Elliman is the listing agent for the unit.
Elsewhere in Florida
- Strategic Property Partners filed plans for the second phase of the Water Street mixed-use project in downtown Tampa, which is expected to include 38,000 square feet of retail, parking and a park, according to the Tampa Bay Times. Strategic previously planned to add an office building, entertainment component and a condo tower.
- Florida’s Supreme Court rejected a challenge over eliminating a majority-Black district in North Florida, keeping in place current congressional districts that give Republicans an advantage over Democrats, AP reports.
- Palmetto Bay approved an agreement with Goddard Investments Group to redevelop Burger King’s former headquarters into a mixed-use development with apartments, townhouses, retail, restaurants, office space and possibly a hotel, after the developer secured key wins in court, the Miami Herald reports.
