News About Properties

Dolphin Tower’s troubles stack up [South Florida]

Amid the discovery of still more concrete problems at Dolphin Tower, it appears that more money and more time will be needed to repair the damaged 15-story condo building.

Just as vexing to displaced residents, though, are signals that Great American Insurance Co., of Ohio, intends to deny a claim made by Dolphin Tower’s homeowners’ association that would pay for repairs.

Great American, which holds a policy on the 117-unit tower in downtown Sarasota, indicated in a letter to the association earlier this month that a policy claim would not be valid unless the building were to actually fall down.

“One of the defenses, ironically, is that coverage exists only where a building or component actually collapses, rather than being merely at risk of collapse,” said Alan Tannenbaum, a Sarasota attorney representing the association, referring to the letter.

Bulk buyer’s condo coup busts small-time investors

In early 2008, with the real estate market well into meltdown, a deal to sell more than 100 condominium units in Royal Palm Beach was struck.

Considered one of South Florida’s first bulk condo buys, it was called “savvy” by market analysts and heralded as a sweetheart deal for Miami-based purchaser Kensington Trust LLC.

The high-priced flips that the trust subsequently made to individuals, sometimes for 75 percent more than it paid, was optimistically thought to be a sign of a real estate upturn.

Two years later, 70 percent of the units at the Kensington at Royal Palm Beach are in foreclosure or were recently repossessed by lenders.

New state law might help reclaim fees [South Florida]

Many community associations throughout Broward have been struggling during the recession after foreclosed homes were left vacant and some financially strapped property owners quit paying their maintenance fees.

Now the state has stepped in to try to help; a new law allows both homeowner’s and condominium associations to deny nonpayers access to clubhouses, pools, fitness rooms and other shared community property. It also stipulates that foreclosing banks now will have to pay a year’s worth of unpaid maintenance bills or 1 percent of the original mortgage debt.

Even more controversial, the state allows associations to demand renters pay the community fees that their landlords aren’t paying, an attorney told a packed Pembroke Pines town hall meeting on Aug. 11.

Homeowner’s and condo associations now can directly bill renters for maintenance fees, with the property owner getting any rent money left over, said Lisa Magill, a partner in the law firm Becker & Poliakoff, which represents many community associations throughout South Florida.

Professional investors move into flipping foreclosed homes

Hoping there are big profits to be made in the aftermath of California’s housing collapse, professional investors are flocking to the business of buying foreclosed homes at distressed prices.

The investors, primarily private equity funds and groups of wealthy individuals, purchase the homes at public auctions, which are held daily on the steps of local courthouses. They refurbish the properties and try to sell them for quick profits.

Not long ago, the typical home flipper was an amateur tapping a home equity line or savings for an investment property. But professionals have rushed in, partly because of sparse investment opportunities elsewhere.

Pinnacle’s real estate fallout

When Pinnacle Financial Partners got started 10 years ago, the bank’s executives, who had survived many a past real estate collapse, pledged to focus lending on business and industry — not real estate development.

Now, the bank is beset by loan problems linked to real estate and homebuilding plans gone awry across Middle Tennessee, quite the opposite of its original goals.

This much seems clear: A series of acquisitions of suburban banks in the past few years shifted a larger concentration of the bank’s loans into real estate development in fast-growing areas around Nashville, leading to questions about how smart its bank purchases truly were.

The fallout has been severe.

Developer’s Money Woes Evident in Bartow Foreclosure Sale [Central Florida]

An anchor building in downtown Bartow is going on the auction block Tuesday in a foreclosure sale, reflecting the financial nightmare plaguing Lakeland developer Jose Reynoso.

He paid $380,000 for the Berkowitz building at 415 E. Main St. in 2006, and spent thousands of dollars renovating it for offices and retail shops.

He bought four more downtown buildings soon after that and funneled more money into those renovations.

As recently as December, he bought two acres of vacant land along U.S. 17 south of Hooker Street in East Bartow for $195,000, and he signed leases with options to purchase two more downtown buildings.