Miami foreclosure listings continue to get filled with distressed condos. As rents fall to their lowest levels and vacancy rates soar, more condo owners and developers are being forced to foreclosure.
Among the recent condo foreclosures is the oceanfront South of Fifth Condominium in the South Beach area, which was foreclosed by iStar FM Loans, one of the subsidiaries of iStar Financial. The developer, BR Villa Luisa LLC, and investors Michael Samuel, Marc Sznajderman, Romano Tio and R. Ramin Kamfar, failed to pay their outstanding loan balance of $78.9 million.
Based on foreclosure records in the Miami-Dade County Circuit Court, iStar targeted 25 unsold condo units in the 7-story complex. Of the 28 units completed, only three units were sold. One was sold for $400,000; the other was sold for $6.8 million; and the third was sold for $1.3 million.
Adam Greenburg, head of Miami firm Baybridge Real Estate Group, said the condo project is a strong project because of its prime location, but the price level is too high during these difficult times. He added that if the developer lowered the price per square foot to $800, the condo units could have been sold quickly.
The developer however stuck on the per square foot price of $1,300, hindering sales and adding the project to Miami foreclosure listings.
Based on public data, the iStar legal action was the second foreclosure suit that hit BR Villa Luisa in connection with the project. In 2006, BR Villa Luisa got hit by a foreclosure lawsuit from Capmark Financial over an unpaid $77.6 million loan. Negotiations were made and Freemont Savings and Loan acquired the mortgage. Later, Freemont sold the mortgage to iStar.
Another recent foreclosure action in the Miami area involved the Venetian Parc housing project in the southern part of Miami-Dade County. Developer Quantum Ventures and investors Oscar Barbara and Augustin Herran failed to pay their outstanding loan balance of $39.4 million.
The developers planned to build 58 townhomes and 154 single-family houses on the 116-acre site, which was formerly used for agriculture, but they failed to pursue their plans.
Foreclosure actions against investment firm Power One Group also added to foreclosure statistics in the Miami area. Among the several foreclosure lawsuits filed against the firm involved condo units in Miami Lakes, a 12-acre vacant land in the northwest part of Miami and an apartment complex in North Miami Beach.
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