Fort Partners will proceed with its buyout of a West Palm Beach condominium following a legal skirmish with Related Ross that ended in a settlement last week, The Real Deal has learned.
The legal battle that started with a Related Ross affiliate filing a request for an injunction in April came to a close on Friday, Oct. 17, when Steve Ross’ Related and Nadim Ashi’s Fort Partners settled out of court, Ashi’s attorney Glen Waldman confirmed. The terms of the deal were not disclosed, but Waldman confirmed Fort Partners plans to move forward with a condo termination for Harbor Towers, the 2-acre, two-building, 61-unit complex at 3901 South Flagler Drive.
Representatives for Related did not respond to immediate requests for comment.
While it was the fight for control of Harbor Towers that precipitated the legal battle, the true scope of the developers’ entanglement spans three waterfront sites totaling nearly 4.3 waterfront acres. It’s a sizable swath of waterfront land across the Intracoastal Waterway from Donald Trump’s Mar-a-Lago Club, at a time when few waterfront sites in West Palm Beach remain.
The sites they targeted include Harbor Towers, as well as the 60-unit condominium Southbridge at 3915 South Flagler Drive and a multifamily complex at 3907 South Flagler Drive and 3906 Washington Road.
Related and Fort Partners made competing offers to owners at Southbridge last year, with Related’s $42 million bid winning out. The price works out to $700,000 per unit, in a building where the property appraiser estimates market value for most units at about $200,000. Records show Related affiliate Southbridge Acquisitions LLC has closed on 17 units since December. It is unclear if or when Related plans to close on the remaining units.
Ashi’s affiliate WPB S Flagler Owner LLC bought the adjacent apartment complex at 3906 Washington Road and 3907 South Flagler Drive for $20 million in November, records show.
Related’s affiliate Harbor Towers Acquisitions LLC and Ashi’s affiliate WPB Harbor Towers Acquisition LLC started inking competing deals with Harbor Towers in the spring. Waldman said Fort had deals in place with the majority of units and had secured control of the condo board when the Related affiliate filed its suit in Palm Beach County Circuit Court in April, requesting an injunction to block Fort’s changes to the condominium declaration. The legal fight escalated in September, when Related filed motions for protective orders to block the deposition of Steve Ross and Related executive vice president Jordan Bargas. Fort’s attorneys responded, accusing Related of stalling under the guise of settlement talks. Two weeks later, a deal was signed.
Fort’s attorney, Waldman, who represents the holdout owners in the Biscayne 21 case against Two Roads Development, said he was comfortable representing a developer in this case because of the prices Fort Partners offered in its buyout. Recorded sales to Fort’s Harbor Towers affiliate range in price from $1 million to $3.3 million, more than double the market values assessed by the property appraiser.
“The amount of money being offered was significantly in excess of what [the units] were worth,” he said. “These owners were making so much money, there are no losers here.”
