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Palm Beach home prices soar on estate sales

Palm Beach County from the sky

The average price of single-family homes in Palm Beach County skyrocketed over the past year led by a rush of luxury sellers looking to unload properties ahead of changes to the federal tax code, Brown Harris Stevens said in a market report released today.

Prices averaged $5.03 million in the six months ending in March, a 78 percent gain over the $2.83 million average in the same period a year ago, with private estates doubling from $5.52 million to $11.2 million.

Average prices jumped because of estate sales during the period, which climbed 375 percent, from four to 19, as luxury homeowners looked to sell before the end of 2012, anticipating a new capital-gains tax regime — and a rise in taxes — in 2013, the report said.

Conversely, the price of condos in Palm Beach cooled down, according to the report, with the median price declining by 7 percent, from $400,000 to $372,000. Condo sales climbed 21 percent.

Swedish investor Par Sanda shells out to save hotels from foreclosure

From left: the Martindale and the Seaside Motel

Swedish investor Par Sanda, an active Fort Lauderdale developer, paid $4.9 million for three hotels there, the South Florida Business Journal reported.

A Sanda-affiliated LLC named Kathy is Great acquired the properties after the lender Iberiabank won a judgment in March against the former owner Sable Resorts and managing member Lawrence A. Duprey, slating four properties for auction.

The LLC acquired the Martindale, an 11,453-square-foot Art Deco resort; the Seaside Motel, a 8,852-square-foot resort; and the Sandy Shores, a 6,064-square-foot motel. Sable Resorts retained ownership of the Front Hotel and Apartments, a 7,329-square-foot complex.

Sanda wants to convert the run-down properties into a European-style village of condos and hotels, project manager Karen Johnson told the Journal.

Sanda started buying up properties – including boarded-up buildings – in 2010 with plans to convert them into trendy apartments and hotels. [South Florida Business Journal]Emily Schmall

Bal Harbour Shops developer plans expansion, invests in Brickell project

Brickell CityCentre

The family of Stanley Whitman, the developer of the Bal Harbour Shops, plans to expand the high-end mall outside of Miami and, separately, in January purchased an unspecified stake in the proposed 500,000-square-foot retail Brickell CityCentre project, the Wall Street Journal reported.

Americaribe and John Moriarty & Associates of Florida were awarded oversight in March of vertical construction at the Brickell CityCentre project, an appointment worth approximately $500 million, as previously reported.

The contractors Americaribe and Moriarty will operate as a joint venture and be responsible for completing the first phase of the $1.05 billion, 5.4 million-square-foot Brickell project, which is being developed by Swire Properties. Phase one will include a luxury shopping center, two residential towers, a hotel, a wellness center and Class A office space, all scheduled for completion by the fourth quarter of 2015.

A separate $100 million investment would expand Bal Harbour Shops to 650,000 square feet from 450,000, Matthew Whitman Lazenby, Whitman’s grandson and operating partner of Bal Harbour Shops, told the Journal. The iconic luxury shopping center, opened in 1965, boasts Fendi, Dolce & Gabbana and Ermenegildo Zegna, retailers that the Whitmans will also approach to consider opening locations in the proposed Brickell CityCentre project, the Journal said.

“We recognized this evolving demand from luxury tenants who now see the whole Miami area as worthy of more than one store,” the Journal quoted Lazenby as saying. [WSJ]Emily Schmall

Florida Gaming to sell Miami jai-alai facilities

Jai-alai

Casino operator Florida Gaming could go out of business before it closes a deal to sell its money-losing jai-alai frontons, the courts where the fast-paced ball game is played, the South Florida Business Journal reported.

Florida Gaming, which reported a 2012 operating loss of $23.2 million, intends to sell its Miami and Fort Pierce jai-alai frontons to Silvermark, an affiliate of New York-based Silver Entertainment, for $115 million, plus the assumption of $15 million in mortgage payments owed to Miami-Dade County.

Shareholders approved the deal, but Florida Gaming may still need court approval in Miami-Dade County, where ABC Funding filed an $87 million foreclosure lawsuit against the frontons because of alleged unpaid construction costs.

The deal was expected to close April 30, but Florida Gaming’s accountant expressed in a recent annual report “substantial doubt” over the company’s ability to continue as a “going concern.” Despite rising income from slot machines and poker tables, the company has been unable to revive interest in jai-alai, a game that was once one of the region’s primary draws. [South Florida Business Journal]Emily Schmall

Law firm Becker & Poliakoff move HQ to downtown Fort Lauderdale

1 East Broward

Law firm Becker & Poliakoff will take the top three floors of downtown Fort Lauderdale’s 1 East Broward for its new headquarters, landlord Ivy Realty said in a press release today.

Becker & Poliakoff will move into the 46,000-square-foot space in January 2014. The firm will relocate from an office on Stirling Road in Hollywood, the statement said. The 40-year-old firm has 12 Florida offices in addition to offices in New York and New Jersey. “We are excited to move to 1 East Broward,” managing shareholder Gary Rosen said in the statement. “Ivy Realty has done a wonderful job reviving the building, and it will provide the amenities, layout and design that will serve the firm well as we look to the future.”

Ivy Realty purchased the then-distressed asset in 2011. Since the trade, Ivy has renovated the 19-story, 340,0000-square-foot building previously known as the Wells Fargo tower and re-branded it as 1 East Broward. Improvements include the installation of an “art wall,” a state-of-the-art fitness center and a restaurant serving farm-to-table locally grown produce.

“We’re bringing a sophisticated mid-town Manhattan feel to downtown Fort Lauderdale office space,” Anthony DiTommaso, co-CEO of Ivy Realty, said in the statement. –Evan Bleier

Florida still suffering from effects of foreclosure crisis, says Trulia’s Kolko: VIDEO

Trulia’s chief economist Jed Kolko said that although the housing recovery was “for real,” the price rises in many major markets were simply a rebound from the dark days of the housing bust. Speaking in an interview on Bloomberg News, Kolko said that strong job growth was increasing household demand, leading to an appreciation in house prices.

“What we’ve seen is a big shift of sales away from distressed properties to conventional properties,” Kolko said. “That’s a healthy thing for the market.”

Addressing the question of shadow inventory, Kolko said that it was localized in markets such as New York and Florida, places which have a lengthy foreclosure process. “In the rest of the country, most of the foreclosure crisis is behind us.” Nationally, he said, it is roughly 44 percent cheaper to buy than to rent.

Foreign investors will continue to be players in the market, he said, noting that Trulia had seen significant online search activity from abroad, particularly in Florida, New York and Southern California. [Bloomberg News, via YouTube]Hiten Samtani

Elliman nabs sister duo from NYC firm Citi Habitats

From left: Elizabeth and Tracie Hamersley

From the New York site: Sister duo Tracie and Elizabeth Hamersley, the perennially top-ranked sales team at New York City brokerage Citi Habitats, have decamped for Douglas Elliman, The Real Deal has learned.

The Hamersleys — along with team members Robert Falcone, Jason Lopez and Thuy Truong — began working yesterday out of Elliman’s office at 774 Broadway in Manhattan’s Greenwich Village.

In almost a decade at Citi Habitats, the sisters have won many of the awards that the firm hands out. In 2012, the Hamersleys ranked first in overall production and sales, both for the second consecutive year. In 2011, they were also the top rental team, and in 2010, the sisters together nabbed the top sales agent prize.

A spokesperson for Citi Habitats did not immediately respond to requests for comment.

While Tracie was careful to note that the move had nothing to do with Citi Habitats, she said Elliman would offer the team additional capabilities.

“We just think there are greater sales opportunities at Elliman — not that Citi Habitats couldn’t offer them,” Tracie said.

Additionally, she is licensed in New York and her native Florida, where Elliman has eight offices. And the sisters were attracted by the fact the Broadway office is a retail storefront; previously, they had worked out of Citi Habitats’ corporate headquarters at 250 Park Avenue South in Manhattan.

The Hamersleys will continue to handle both sales and rentals, Tracie said, estimating that about 85 percent to 90 percent of their business at Citi Habitats was focused on sales, though the firm is better known for its rental offerings.

“We really did have a great run at Citi Habitats,” she said, “and we love everyone there very much.”

Tracie, the older sister, joined Citi Habitats as a newcomer to the industry in 2003. About a year later, Elizabeth came on board, and the pair have been working together ever since. They added their first team member in 2008, as The Real Deal has reported.

“Tracie and her team are a tour-de-force in the industry,” Dottie Herman, Elliman’s president and CEO, said in a statement. “They are truly among the most talented agents in the business and will be a tremendous asset to our company.”

The Hamersleys’ exit is the latest departure for Citi Habitats.

Gordon Golub, the firm’s director of rentals and an 18-year veteran, left for a tech start-up called Urban Compass in January. In October, the brokerage’s head of new development marketing, Clifford Finn, joined Elliman. And Rado Varchola, a top-ranked sales broker at the firm, joined Nest Seekers International in September.

In the last year, Citi Habitats also has shuttered two offices — at 27 East 22nd Street and 32 East 22nd Street — and consolidated its new development marketing operations with Corcoran Sunshine Marketing Group, the new development arm of the Corcoran Group. Both brokerages are subsidiaries of NRT, a unit of the real estate conglomerate Realogy.

Gary Malin, the president of Citi Habitats, and Pam Liebman, the CEO of Corcoran, have dismissed concerns that the brokerage is faltering.

The office closures were part of a strategy to consolidate multiple small offices into new, larger locations, Liebman has said. Additionally, the brokerage has not cut back expenditures since 2009 and had a “banner” sales year in 2012, according to Malin and Liebman.

Florida foreclosure settlement checks have bounced, borrowers say

South Florida borrowers recently began receiving payouts from a $3.6 billion fund created by the federal government and 13 private mortgage servicers as part of a settlement ending litigation over widespread foreclosure malpractices. But some recipients are now saying the checks have bounced, the Palm Beach Post reported.

The Independent Foreclosure Review mailed more than 1 million checks April 12 as part of the January agreement; some borrowers said they couldn’t cash the checks because of insufficient funds.

A fund official has assured them that it does have money in the bank, the Post said.

Florida has the second-highest foreclosure rate in the U.S., at one out of every 317 homes, just behind Nevada, where the foreclosure process has initiated on one out of every 306 homes, according to RealtyTrac.

The contracted paying agent, Rust Consulting, explained Tuesday the fund is capable of making good on the checks, which range from several hundred dollars to $125,000, the Post reported.

“We want to assure the public that checks we have mailed under the Independent Foreclosure Review Payment Agreement process are valid,” Rust Senior Vice President James Parks said in a release. [Sun-Sentinel] – Emily Schmall

Industrial construction in Miami-Dade on the rise

A warehouse in Miami

After several years of almost no new industrial construction in Miami-Dade County, more than 1.2 million square feet of industrial space is now in development, World Property Channel reported. Although that number is still well below the approximately 3 million square feet of industrial space added annually in the county before the crash, the market appears to be recovering.

Miami-Dade will need several million square feet of new industrial space within the next three years to accommodate growing businesses, projections from commercial brokerage CBRE show.

“Most of the activity you see now was driven by the economic recovery and the fact that Miami is an outstanding distribution market driven by Latin America,” Mike Ruen, managing director of developer DCT Industrial, told World Property Channel. “Any benefit from the Panama Canal would be a bonus.” The canal is being expanded and should double capacity by 2015, which will undoubtedly bolster shipping and related businesses in the Miami area, according to published reports.

The Airport West and Medley submarkets, near Miami International Airport are the most active spots for industrial development in the county. Ground was broken on the 125-acre Miami International Tradeport in Medley earlier this year. The building is scheduled to be completed next fall.

The market’s resurgence has also caused prices to surge. Near the market’s peak, land in Airport West was selling for $20 to $23 per square foot; prices have rebounded to about $15 to $18 per square foot, per numbers from CBRE.

“As the absorption of space continues, rental rates are expected to go above $10 per square foot, which is where they were at the peak of the market in 2007,” said Michael Silver, vice president at CBRE. [World Property Channel]  –Evan Bleier

U.S. hedge funds eye Florida, as they buy up distressed single-family homes

Warren Buffett

Hedge funds are snapping up discounted single-family homes in South Florida to feed a growing appetite for rental properties, the Palm Beach Post reported.

A comment by Berkshire Hathaway Chairman Warren Buffett last year appears to have inspired heavyweight private equity funds like Blackstone Group and the Connecticut-based Starwood Property Group to sink money into the distressed residential real estate market, and, perhaps due to the number of distressed properties available, South Florida has been a favorite spot for such investments, the Post said.

Buffett told CNBC’s Squawk Box that if he could find a way to manage them, he would buy “a couple hundred thousand single-family homes.”

Blackstone Group created housing firm Invitation Homes to invest more than $3 billion in single-family homes nationwide, according to the Post. The private equity giant has purchased about 150 homes in Palm Beach County and another 500 in Broward and Miami-Dade counties, the newspaper said, citing property appraiser records.

“This is a growing market where people, more and more, are becoming renters either by choice or because of economic circumstances,” said Invitation Homes chief operating officer Marcus Ridgway. [Palm Beach Post]-Emily Schmall