HRI founder Aaron Carr and Virginia Attorney General Mark Herring (Facebook, Getty)

The advocacy group that slapped bigwig brokerages and landlords in New York City and its suburbs with suits over source-of-income discrimination has taken its show on the road.

An investigation by New York-based Housing Rights Initiative found 29 landlords and brokers in Virginia illegally discriminated against low-income renters by refusing to accept their Section 8 vouchers.

The state’s attorney general filed 13 lawsuits against the offending parties. HRI, which is not a plaintiff in the suit, may be entitled to compensatory damages as an aggrieved party, a spokesperson for the group said, for “the frustration of its mission and the diversion of resources that occurred as a result of the defendants’ discriminatory conduct.”

HRI, a nonprofit with a national reach, has been on a tear in 2021. This is the third blockbuster suit filed this year following undercover real estate investigations. In March, HRI hit 88 landlords and residential brokerages, including Compass and Corcoran, with a suit over Section 8 discrimination. In June, 36 defendants in Westchester received the same treatment.

The Virginia suit is HRI’s biggest action outside the Empire State to date, a spokesperson for the group said, and the first of its kind in Virginia.

In 2020, Virginia updated its Fair Housing Law to add four protected classes — source of income, veteran status, gender identity and sexual orientation — under the law’s protection from housing discrimination.

Aaron Carr, HRI’s founder and executive director, credited the legislative amendment with allowing the nonprofit to “shine a light” on unlawful housing practices. HRI was tipped off to potential widespread discrimination by a fair housing ally, HRI’s spokesperson said.

“We hope our investigation, this lawsuit, Virginia’s anti-discrimination laws, and our partnership with the attorney general’s office serves as a housing enforcement model for the rest of the country,” Carr said.

New York added source-of-income discrimination to the states’ Human Rights Law in 2019 after a coalition of over 100 organizations lobbied for the change.

However, the Fair Housing Act does not include source of income as a class protected from discrimination on a federal level. The law forbids discrimination because of race, color, religion, sex, disability, familial status or national origin.

“The findings of our investigation demonstrate why Virginia’s ban on housing voucher discrimination is desperately needed on a federal level,” said HRI deputy director Joshua Murillo.

The post Housing Rights probe pins voucher discrimination on VA landlords, brokers appeared first on The Real Deal South Florida.

Don Peebles, Michael Swerdlow and a rendering of the development (Black 55)

Don Peebles dropped his three pending claims for $160 million, ending his litigation alleging that he was duped out of developing in Miami’s Overtown. His decision came after his entity, Overtown Gateway Partners, which had filed the lawsuit last year, lost two counts over the course of the case.

Following Overtown Gateway putting to rest all of its remaining claims, Miami-Dade Circuit Judge Michael Hanzman issued a final judgment last week, officially ending the litigation.

The case centered on two vacant properties, “Block 55” at 249 Northwest Sixth Street and “Block 45” at 152 Northwest Eighth Street. In 2013, Overtown Gateway won a solicitation by Miami’s Southeast Overtown/Park West Community Redevelopment Agency to develop both properties.

In the following years, Overtown Gateway — which is also tied to Peebles’ project joint venture partner and real estate investor Barron Channer — lost its development rights to the land, and the CRA gave developer Michael Swerdlow the blessing to build on one of the lots.

Swerdlow is building his Sawyer’s Landing project on “Block 55” with 578 senior affordable apartments, a Target and an Aldi. “Block 45” reverted back to Miami-Dade County under a separate city-county agreement, and it remains vacant.

Overtown Gateway took issue with how it missed out on the opportunity, alleging backdoor dealings between some CRA officials and Swerdlow as well as Swerdlow’s venture partner, Alben Duffie.

In March 2020, Overtown Gateway sued Swerdlow, his Downtown Retail Associates affiliate and Duffie. Overtown Gateway alleged in the suit that some in the CRA favored Swerdlow.

In September of that year, Hanzman issued an order striking Overtown Gateway’s $90 million breach of contract claim.

This August, Hanzman also struck another claim by the entity, for $15 million.

In that count, Overtown Gateway alleged that it felt strong-armed by the CRA to sell its rights to the land to Swerdlow’s Downtown Retail and entered a Membership Interest Purchase and Sale Agreement (MIPSA) in 2016. Downtown Retail was to pay $15 million for the rights to the land. Overtown Gateway agreed to the deal because it did not want to lose the money and work it had put so far toward planning its development, according to Overtown Gateway’s suit.

At the same time, the CRA was delaying vital project approvals for Overtown Gateway, as a way to pressure it to enter the agreement with Downtown Retail, Overtown Gateway alleged in its suit.

But the agreement had a confidentiality provision banning Swerdlow from discussing the lots with the CRA behind Overtown Gateway’s back. Because Swerdlow broke this confidentiality clause, the CRA ended Overtown Gateway’s rights to the land, according to the complaint.

Hanzman in his August order disagreed, saying the confidentiality provision said that Overtown Gateway would have a claim if Swerdlow’s alleged secret talks were the only reason the CRA ended Overtown Gateway’s rights to the lots. Because there were other reasons at play, including Overtown Gateway “voluntarily” signing a termination agreement for “Block 45” with the CRA, Overtown Gateway did not have a claim, Hanzman ruled.

In September, Overtown Gateway dropped its three remaining counts. In turn, Swerdlow and Downtown Retail dropped their counterclaims over how the agreement is interpreted.

Overtown Gateway’s attorney and Channer did not respond to a request for comment on why they opted to drop the remaining claims.

Alan Kluger – the attorney for Swerdlow, Duffie and Downtown Retail – hailed the outcome, saying the suit had “no merit from the very beginning.”

The case “was brought solely to paralyze the development of Sawyer’s Landing,” Kluger said in an emailed statement. “With all of Mr. Peebles’ claims now dismissed, Swerdlow Group can forge ahead in delivering a direct, positive impact in Overtown in the form of new jobs, new tax revenues, and much-needed affordable housing.”

Sawyer’s Landing is expected to be completed in 2023.

The post Don Peebles drops remaining $160M claims tied to Overtown development lawsuit appeared first on The Real Deal South Florida.

From left: Dan Gelber, Mayor of Miami Beach and Philip Levine, Former Mayor of Miami Beach (Getty Images, iStock)

Miami Beach Mayor Dan Gelber and his predecessor, Philip Levine, courted unidentified developers to raise money for city commission candidates who favor Gelber’s agenda for Ocean Drive, and offered them carte blanche access to city staff for redevelopment proposals in the Art Deco Entertainment District. He also promised to push through unpopular ballot referendums that would increase height and density in South Beach’s most famous street.

It was all recorded in a Zoom call from last month.

The Real Deal obtained a nearly 10-minute spliced recording of the 60-minute Sept. 13 Zoom call. Gelber and Levine are heard addressing a group that includes Miami Beach developers.

“I know the projects you have done,” Gelber said. “You have always thought of our city as a canvas…What I would really love you to do is tell us what you need to reimagine the areas we need to be reimagined….If you want something on the ballot, I will put it on the ballot. I will support the idea, even if it is not particularly popular.”

Gelber and a Miami Beach spokesperson did not immediately respond to a request for comment.

Fabian Basabe, a Miami Beach resident who was recently disqualified from a Miami Beach city commission race, was on the call and recorded it, according to the Miami New Times, which also obtained a copy of the audio and was first to report on it.

In addition to Gelber, Levine and Basabe, the hour-long virtual meeting included Miami Beach City Manager Alina Hudak and a group of developers, according to Miami New Times. Basabe edited down the call to roughly 9 minutes and 23 seconds when Gelber and Levine were speaking.

Gelber is the main proponent of a Nov. 2 ballot measure that would roll back last call for alcohol in nightclubs and bars in the Art Deco Entertainment District, to 2 a.m. from 5 a.m. Longtime Ocean Drive businesses such as Mango’s Cafe and the Clevelander South Beach accuse Gelber and city leaders of using crime and mayhem in the entertainment district as an excuse to shut them down.

During the Zoom call, Gelber said he encouraged developers to present redevelopment proposals for Ocean Drive, promising them cooperation from Miami Beach Planning and Zoning Director Thomas Mooney. “If we can add 25 feet or 50 feet to Collins Avenue spaces to give you a little more room, you have to let us know,” Gelber said. “There is a lot of capital that wants to come to the city. We are of great interest to the world right now. That is what I would love for all of you to exploit.”

Gelber suggested the developers could even put referendums for increasing height and density of buildings “on the ballot forcibly, without city commission approval.” The city charter allows residents to place items in the ballot via petition and sidestep the city commission.

Levine, who was Miami Beach’s previous mayor and ran unsuccessfully for Florida governor in 2018, said the group would put together a political action committee that would raise money to elect candidates that agree with Gelber’s vision.

“We would utilize that money to elect folks that would move the city in a positive, safe direction,” Levine said. “We need to utilize whatever influences we have to push those six commissioners to follow the vision of the mayor and the manager to make the city safer.”

Miami Beach law bans developers and real estate professionals who contribute to city commission candidates from doing business with the city. State law also prohibits municipal and government employees from participating in political activities, which Gelber was mindful of during the Zoom call.

“We cannot talk about a PAC, Gelber said. “I really shouldn’t be here talking about it with city personnel.”

The post Dan Gelber uncut: Miami Beach mayor caught on tape courting developers for Ocean Drive takeover appeared first on The Real Deal South Florida.

Palazzo Della Luna and 6800 Fisher Island Dr

A nearly $24 million closing on exclusive Fisher Island marked the priciest condo sale last week in Miami-Dade County.

Condo sales dollar volume for the week reached $124 million, compared to $96.9 million the week before. Sales totaled 176, compared to 183 the previous week.

Condos sold for an average price of about $705,000, versus $529,000 the prior week.

On Fisher Island, unit 6893 at Palazzo Della Luna, the newest building to be completed on the Miami Beach island, sold for $23.8 million. It was on the market 650 days, or a year and nine months. Dora Puig represented the developer, which sold the unit. Tatyana Ionin represented the buyer. The luxury condo traded for close to $2,500 per square foot.

The second most expensive sale was the $9.2 million sale of Regalia unit 10 in Sunny Isles Beach. The full-floor unit traded for more than $1,800 per square foot after 120 days on the market. Nayla Pradines represented the seller, and Rosa Poler represented the buyer.

Here’s a breakdown of the top 10 sales from Oct. 10 to Oct. 16.

Most expensive

Palazzo Della Luna unit 6893 | 650 days on market | $23.8M | $2,477 psf | Listing agent: Dora Puig | Buyer’s agent: Tatyana Ionin

Least expensive

W South Beach unit 1015 | 171 days on market | $1.8M | $1,793 psf | Listing agent: Diana Garchitorena | Buyer’s agent: Haydar Alchalaby

Most days on market

Palazzo Della Luna unit 6893 | 650 days on market | $23.8M | $2,47 psf | Listing agent: Dora Puig | Buyer’s agent: Tatyana Ionin

Fewest days on market

Continuum South unit 501 | 14 days on market | $2.8M | $1,760 psf | Listing agent: Sheila Rojas | Buyer’s agent: Domingo Gandara

The post $24M closing on Fisher Island tops Miami-Dade weekly condo sales appeared first on The Real Deal South Florida.

VTS CEO Nick Romito and Lane Technologies CEO Clinton Robinson

Proptech unicorn VTS remains committed to the revival of office life, set to make another big acquisition in the office app space.

The New York-based software and data firm is set to acquire Toronto-based Lane Technologies for $200 million, according to the Wall Street Journal. With the deal, the company is set to combine Lane and VTS Rise into the world’s largest office-app firm.

The deal marks one of the largest in the history of the proptech sector.

After the acquisition, apps from the newly formed firm will allow employees to book conference rooms and get through building security. The platforms would also allow workers to order food and communicate with local restaurants and vendors, the Journal reports, likely easing the experience of returning to the office.

Upon the deal’s closing, VTS’ office-app business will be present in more than 1,400 buildings for more than 2 million users across the United States and Canada, according to the Journal, and count major office landlords including Brookfield, Oxford Properties Group, Starwood Capital Group and RXR Realty as customers.

VTS made headlines in March, when the company agreed to acquire Rise Buildings for around $100 million. The Chicago-based startup powers a mobile app that was used in about 350 buildings totaling more than 130 million square feet at the time the acquisition was reported.

Lane, which is used in more than 300 buildings in eight countries, raised $10 million in its first funding round in May.

Companies and landlords have in recent months sought to improve the office experience and entice employees to return after more than a year away. Some companies are adding perks, such as gym memberships and free snacks, to lure workers back.

Workers do appear to be coming back, albeit slowly. In ten major cities, an average of 36 percent of the workforce was back in the office the week of Oct. 4, according to data from Kastle Systems. The figure marked the second straight week of more than a third of the workforce back in the office.

[WSJ] — Holden Walter-Warner

The post VTS to buy office-app developer for $200M appeared first on The Real Deal South Florida.

Jack Sylvan, senior vice president of development at Brookfield Properties, and the Stonestown Development Project (Brookfield Properties/SITELAB urban studio, Wikipedia, LinkedIn)

Brookfield Properties filed plans for a $2 billion project to turn San Francisco’s Stonestown Galleria mall and its sea of parking lots into a new west side neighborhood, setting in motion a development that may consume the better part of two decades.

The New York firm, which owns the 41-acre site at 3251 20th Avenue, aims to build about 2,900 homes as well as stores, offices and open space, according to a preliminary project assessment that it filed late last month with the city’s planning department.

The move marked the start of a planning and environmental review process that’s expected to last about two years. Then, if the proposal gets the city’s blessing, Brookfield would build a new neighborhood around Stonestown during the next 15 years, according to its application.

The application process resembles “the start of a marathon,” said Jack Sylvan, senior vice president of development at Brookfield Properties, in an emailed statement. “We’re excited about filing this master plan concept because it represents more than two years of work and prodigious feedback from the community.”

The 775,000-square-foot shopping center takes up 11 acres of the entire site, anchored by Target, Regal Cinemas, Sports Basement and, by the end of this year, Whole Foods. It includes more than 100 other shops and restaurants.

Most of the mall would be incorporated into the project. Its largest component would be 2,930 housing units in buildings ranging from three to 18 stories high. Brookfield intends to offer rental, for-sale, market-rate, and affordable homes, although the number accessible to tenants with low or moderate incomes hasn’t yet been specified.

About 90 percent of 400,000 square feet of additional new space will be offices and stores. Retail will mostly be on the eastern side of the site on 20th Avenue, which Brookfield intends to transform Into a pedestrian-friendly main street from a roadway that’s now better suited for vehicles.

The west side would be a relatively quieter place where residents and shoppers can gather at a town square and park. The project contains six acres of publicly accessible parks, plazas, and open space.

Brookfield plans to build up to 3,700 parking spaces, about 300 more than what’s there today.

SITELAB urban studio is leading the master planning effort. It’s also overseeing master planning efforts for some of the Bay Area’s largest mixed-use developments, including Google’s 80-acre transit village in San Jose and the 5M project in downtown San Francisco, a joint venture between Brookfield and the Hearst Corporation.

Other members of the Stonestown redevelopment team include Einwiller Kuehl Landscape Architecture, David Baker Architects, transportation consulting firm Fehr & Peers, and Carlson, Barbee & Gibson Inc., a civil engineering firm.

The post Brookfield Properties kicks off review process for $2B Stonestown Galleria mall redevelopment appeared first on The Real Deal South Florida.

Co-CEO of Delaware North Louis Jacobs and Google Street View of equestrian estate at 4827 South 125th Avenue in Wellington (Google Maps)

A member of the billionaire Jacobs family, well-established in the Northeast as owners of NHL’s Boston Bruins as well as the team’s arena TD Garden, bought a Wellington equestrian estate for $11 million.

Louis Jacobs and his wife, Joan Jacobs, bought the property at 4827 South 125th Avenue, according to records. The selling entity is managed by Jeannie Harrison, widow of the late railway executive E. Hunter Harrison, who was CEO of the Illinois Central Railroad and CSX, among other rail companies.

The Jacobses took out an $8.3 million loan from JPMorgan Chase.

The 2,996-square-foot, three-bedroom house was constructed in 2001, records show. The 11.4-acre property includes an 18-stall stable, a gazebo overlooking the arena and grass jump field, a 140- by 330-foot jumping arena and an adjacent large grass jump field, according to Realtor.com.

The Harrison family’s affiliate bought this and a nearby 22-acre equestrian estate for $14.1 million in 2017.

Louis Jacobs is co-CEO of Delaware North, a conglomerate providing food and beverage concessions, high-end dining, hospitality and entertainment services at sports arenas, national and state parks, airports and casinos, according to its website. Based in Buffalo, New York, Delaware North services venues worldwide, including MetLife Stadium near New York City, Wembley Stadium in London, Busch Stadium in St. Louis, and Melbourne and Olympic Parks, home of the Australian Open tennis championships.

Delaware North also owns and runs TD Garden, the home stadium for the Boston Bruins and Boston Celtics.

Louis Jacobs’ father, billionaire Jeremy Jacobs, took over Delaware North from his father and uncles. Jeremy Jacobs also owns the Boston Bruins. He relinquished the CEO position at Delaware North to his sons and now serves as chair. He and his wife, Margaret Jacobs, also own Deeridge Farms in Wellington.

Louis Jacobs is listed as alternate governor of the Boston Bruins.

Wellington is considered the winter equestrian capital of the world. It has been the seasonal playground for families of such billionaires as Bill Gates, Michael Bloomberg and the late Steve Jobs, as well as celebrities Billy Joel and Bruce Springsteen.

This month, Fred Drasner, former co-owner of the New York Daily News and the Washington Football Team, along with his wife, Lora Jean Drasner, bought a mansion in the gated Palm Beach Polo and Country Club for $5.2 million.

Embattled developer Glenn Straub, who in 2020 was charged with filing a fraudulent lien on his ex-girlfriend’s property, bought a Wellington mansion for $9 million in June.

The post Boston Bruins co-owner buys Wellington equestrian estate for $11M appeared first on The Real Deal South Florida.

Kushner CEO Laurent Morali (center) with Nicole Kushner Meyer and Jared Kushner (Kushner, Getty, Morali via Sasha Maslov)

Kushner Companies is moving away from its namesake for its next CEO, promoting Laurent Morali to the post.

Morali is being elevated from president to CEO effective immediately, the Wall Street Journal first reported. Nicole Kushner Meyer, a member of the company since 2015 and Jared’s younger sister, is filling the president role.

Morali — the first leader of the real estate firm to come from outside the Kushner clan — is filling a post Jared Kushner left vacant in 2016 to work for his father-in-law Donald Trump’s White House run and, later, administration.

Morali was named president of the company in 2016 after serving as head of acquisitions and capital markets, where he worked under Jared. Morali joined the firm from Calyon Securities in 2008 and played an essential role in $3.2 billion in acquisitions during his first eight years with the company.

The former president also led the firm’s expansion into retail investment and lending.

Kushner values its property holdings at more than $15 billion. In recent years, the company has attracted scrutiny for its business dealings due to Jared’s ties to Trump. Kushner Cos. has also started to look away from Manhattan office deals and more towards rentals in growing hubs, such as the mid-Atlantic and Southeast.

Meanwhile, Jared is in the process of launching Affinity Partners, a Miami-based investment firm, as well as working on a book on his White House experience.

The company has also been busy in South Florida. Earlier in the month, the company scored two loans totaling $127 million for a major apartment development planned for Edgewater. Kushner has several other plans in the region, including a massive downtown Fort Lauderdale development in partnership with Aimco and two mixed-use projects in Wynwood.

[WSJ] — Holden Walter-Warner

The post Kushner Companies names Laurent Morali CEO appeared first on The Real Deal South Florida.

Behind: 3702 Washington Street in Hollywood, FL. Front: Chaim Cahane (President, Forte Capital Management, LLC) & Dov Tepper (Director of Acquisitions, Forte Capital Management, LLC) (loopnet.com, fortecap.com)

Forte Capital Management bought a Hollywood medical office building adjacent to Memorial Regional Hospital South for $11 million.

The Miami Beach-based company purchased the property at 3702 Washington Street, according to Chaim Cahane, president of Forte.

A group of five doctors, including at least three with offices at the property, sold the building through an affiliate, records show. That entity bought the building in 2004 for $4.4 million.

The 43,606-square-foot building, constructed in 1995, spans nearly half an acre, according to property records.

The four-story building is 92 percent leased, said Cahane, who worked with Forte’s Dov Tepper to close the off-market deal.

The real estate investment firm plans roughly $250,000 in improvements to the vacant spaces, common areas and building exterior, allowing rent increases. Rents now are 40 percent below market rate, Cahane said.

The medical office market has proved buoyant amid the pandemic. Florida continues to be a magnet for retirees, many of whom require medical care. The Hollywood medical office building connects through a pedestrian overpass to the hospital.

In one of the biggest medical office and hospital deals of the year, Medical Properties Trust bought five South Florida properties for roughly $900 million.

Forte Capital, which focuses on buying underperforming assets and increasing their value through improvements, has properties in South Florida, New York, New Jersey and Connecticut, according to its website.

In March, Forte and Jon Krasner’s 7G Realty purchased a Wynwood retail property at 310-318 Northwest 25th Street for $11.8 million. East End Capital sold the property, which previously had been in foreclosure. The suit was dismissed as the buyers restructured the debt.

The post Forte Capital Management buys Hollywood medical offices for $11M appeared first on The Real Deal South Florida.

JB Capital co-principals Jessica Giguere and Ben Karp with the retail center (Atlantic Retail, JB Capital)

A philanthropic organization founded by a late, prominent South Florida car dealer picked up an office development site for $9.8 million.

The Jim Moran Foundation bought a 2.43-acre lot at 4545 North Federal Highway in Fort Lauderdale, according to records. The foundation plans to start construction next year on a new 50,000-square headquarters with class-A office space, event space and an archives gallery, according to a press release.

The seller is Cargroup LP, a Concord, Ontario-based company that sells used cars online and at auctions. The company is a subsidiary of developer Greenpark Group, which is also based in Canada. The seller paid $8.6 million for the property in 2018, records show.

Law firm Greenberg Traurig represented the foundation and is handling ongoing zoning and permitting matters for the project.

Last year, Cargroup submitted a site plan to the city of Fort Lauderdale for a building with 22,063 square feet of medical offices, 11,865 square feet of general offices, 10,261 square feet of retail and a 171-space parking garage.

Established in 2000 by the late Jim Moran and his family, the foundation funds a variety of social services, including youth education, elder care, family strengthening programs and transitional living initiatives in Broward, Palm Beach and Duval counties, according to the organization’s website.

The foundation currently operates from the Deerfield headquarters of JM Family Enterprises, one of the tri-county region’s biggest automotive dealership firms. It’s subsidiary, Southeast Toyota, is the largest independent Toyota distributor in the U.S., according to JM Family Enterprises’ website.

The vacant site is located about a mile north of a parking lot site where Newrock Partners and Brickbox Development are planning Project O, a 274-unit multifamily project. The property is immediately west of the Kennan Building at 3101 North Federal Highway, which is also owned by the joint venture.

Nearby, Fort Lauderdale investor Michael Daniel bought a vacant, 105-room former Ramada Inn two years ago. Daniel planned to renovate and continue using the property at 3001 North Federal Highway as a hotel.

The post Jim Moran Foundation revs up HQ plan with $10M site acquisition appeared first on The Real Deal South Florida.

From left: David O’Reilly, CEO, The Howard Hughes Corporation and Jerry Colangelo, Partner JDM Partners, in front of a plan for the nearly 37,000-acre Douglas Ranch (The Howard Hughes Corporation, JDM Partners, iStock)

Talk about economies of scale.

The Howard Hughes Corporation announced Tuesday that it has bought the massive, master planned community that Jerry Colangelo has been plotting for nearly 37,000 acres in Phoenix.

The acquisition of the Douglas Ranch project, in the city’s West Valley neighborhood, adds to Howard Hughes’ roster of master planned communities. This one is projected to have 100,000 homes, 300,000 residents and 55 million square feet of commercial space.

Howard Hughes acquired the “shovel-ready” land from Colangelo’s JDM Partners and Mike Ingram’s El Dorado Holdings for $600 million. Both developers will stay on with Howard Hughes as joint venture partners on the first village of the community, Trillium, which will encompass 3,000 acres.

An SEC filing shows JDM and El Dorado have the option to reacquire 50 percent of the master community ― outside of Trillium ― for $271 million, so long as they do so in the next six months.

“We are creating a city of the future—leveraging the Howard Hughes Corporation’s development expertise to build a community with limitless potential to spur growth, business expansion, economic opportunity and innovation,” Colangelo, a former Phoenix Suns executive and member of basketball’s Hall of Fame, said in a press release.

Phoenix has been one of the nation’s hottest housing markets, and sales of Douglas Ranch’s residential lots are expected to begin during the first half of 2022. The developer expects to sell at least 1,000 lots in the first year.

Howard Hughes is the largest operator of master planned communities in the United States. The portfolio includes properties in Las Vegas and Houston.

Phoenix is burgeoning, leading the country’s major metropolitan areas in net migration over the past three years.

The median home price in Phoenix hit $399,900 in June, a 31.1 percent jump from a year earlier. The city also ranks as one of the best in the country in terms of risk-adjusted return on home investments.

Howard Hughes is doing a much smaller, but significant project in Lower Manhattan, on a longtime parking lot at 250 Water Street. The firm’s proposal for a 25-story tower with 270 units, 190 of them market-rate, is expected to be approved Wednesday by the City Planning Commission.

The post Howard Hughes buys 37K acres to build “city of the future” appeared first on The Real Deal South Florida.

Newmark Group CEO Howard Lutnick (Getty)

Newmark Group chairman and CEO Howard Lutnick announced Monday that he has a “highly treatable” non-Hodgkin’s lymphoma.

Lutnick’s diagnosis was announced in a video in which he said his physicians expect him to be cancer-free in four months. The company also included the news in a filing with the Securities and Exchange Commission. He will have six chemotherapy treatments beginning Oct. 18 and running through the end of January 2022.

“I am not going anywhere,” said Lutnick, 60, on a 4-minute video posted on YouTube. “I’m still going to be working. I’m still going to be running the company.”

Lutnick’s video was titled, “My Greatest Challenge Since 9/11.”

Lutnick was the chair of the bond trading firm Cantor Fitzgerald when the firm occupied five floors at the top of the World Trade Center’s North Tower. He was at his son’s first day at kindergarten when the planes struck, killing 658 Cantor employees.

Lutnick joined Cantor in 1983 right after graduating from Haverford College. He was appointed president and CEO in 1991, and helped rebuild the firm after the terrorist attack 10 years later.

Lutnick is also chairman and CEO of BGC Partners, a brokerage and financial technology company. In 2011, BGC bought Newmark, which is now one of the largest commercial real estate brokerage firms in the country.

In the video, Lutnick pointed out that his mother-in law had the same type of cancer three and a half years ago, when she was 85, and survived.

“If dad can’t do better than grandma, then come on,” said Lutnick.

Referring to the chemotherapy, and perhaps to reassure company staff and investors, Lutnick said the most difficult part is going to be the loss of the wisps of hair he has been clinging to for years.

“I always joked I am going to be a bald guy,” he said, “and now I am.”

The post Newmark’s Howard Lutnick has “highly treatable” non-Hodgkin’s lymphoma appeared first on The Real Deal South Florida.

Keith Gelb, Managing Member and Co-Founder, Rockpoint Group (Rockpoint Group, B Hotels & Resorts, iStock)

The beachfront B Ocean Resort Fort Lauderdale — formerly known as the Yankee Clipper — sold for $126.9 million, marking one of the biggest South Florida hotel deals this year.

Boston-based Rockpoint Group and Fort Lauderdale-based InSite Group, through an affiliate, bought the 481-key resort for $117.9 million, records show. They paid an additional $9 million for an adjacent 1.8-acre parking lot.

InSite also was on the seller’s side, as it is tied to the entity led by The Carlyle Group that sold the properties.

The deal equates to $263,773 per room.

The larger of the two deals was the sale of the resort buildings and lots at 1101, 1127 and 1140 Seabreeze Boulevard, as well as at 1136 and 1140 Holiday Drive. In the smaller deal, Rockpoint purchased the parking lots at 3048 and 3054 Harbor Drive.

The hotel originally was developed as the Yankee Clipper in 1956. It spans 3.3 acres.

The selling entity bought the resort for $107 million in 2014 from Barry Sternlicht’s Starwood Capital Group, according to public records. It rebranded it as the B Ocean Resort following renovations.

Carlyle Group, based in Washington, D.C., is a global investor with $276 billion of assets under management across its three business segments of global private equity, investment solutions and global credit, according to its website. Founded in 1987, Carlyle is led by Kewsong Lee.

Rockpoint, led by co-founder Keith Gelb, is a real estate private equity firm. It has other South Florida investments. In May it bought a stake in Mast Capital’s long planned Miami Beach condominium at 4000 Alton Road.

InSite, led by Ben Shmul, is a real estate investor, with other South Florida assets including the 101-key Sagamore Miami Beach, the 253-key Nautilus Hotel in Miami Beach and the 231-key GALLERYone – DoubleTree Suites by Hilton in Fort Lauderdale.

The tri-county region’s hospitality market has been emerging from the pandemic, with tourism bouncing back, though convention business is still lagging.

Still, South Florida saw some top-dollar hotel sales this year. In the biggest deal, Pebblebrook Hotel Trust bought the 369-key Margaritaville Hollywood Beach Resort in June for $270 million.

In July, Fort Partners purchased the Four Seasons Miami hotel in Brickell for about $130 million. And this month, Wheelock Street Capital bought the newly built The Ben West Palm Beach for $106.4 million.

The post Rockpoint, InSite buy B Ocean Resort Fort Lauderdale for $127M appeared first on The Real Deal South Florida.

JB Capital co-principals Jessica Giguere and Ben Karp with the retail center (Atlantic Retail, JB Capital)

A three-year-old, Boston-based commercial real estate firm led a $25.5 million joint venture purchase of Fresh Market Village in Jupiter.

JB Capital Management acquired the 55,046-square-foot retail center at 311 East Indiantown Road, in partnership with Royce Properties LLC, a Woodbury, Connecticut-based family office, according to a release.

The seller is an affiliate of Adar Investments and Management, a commercial real estate firm based in Sunny Isles Beach, records show. Adar paid $8.3 million for the property in 2013.

An Atlantic Capital Partners team led by Justin Smith represented the seller.

Built in 1983, the shopping center is anchored by a Fresh Market. Other tenants include 2 Vinez Restaurant & Wine Bar, Starbucks, Casa Mia and women’s clothing boutique Gretchen Scott Designs.

Jessica Giguere, a JB Capital principal and co-founder, told The Real Deal that the joint venture was attracted to Fresh Market Village’s 97 percent occupancy rate, the property’s proximity to the Intracoastal Waterway and Jupiter’s strong demographics.

Fresh Market Village is JB Capital’s second deal in South Florida after starting out small. The firm acquired a 10,230-square-foot warehouse for $1.1 million in Lake Worth last year, Giguere said.

“We were focused on industrial real estate, but it has gotten more and more expensive,” Giguere said. “We started looking more into retail. There is a little more opportunity there. Before Covid and during Covid, retail in Florida has been performing very well.”

JB Capital and Royce Properties were on the hunt for well-maintained retail centers with good class A retail tenants, Giguere said. “We stumbled across this one,” she said. “We put our hat in the bidding war and ended up being the winners in the deal.”

Founded in 2018, JB Capital owns close to $100 million in real estate assets with various entities as partners in Connecticut, Florida, Massachusetts, New Jersey, New York and Rhode Island, Giguere said.

Sales of South Florida retail centers are booming at a time average retail rents are climbing back to pre-pandemic levels, according to a third quarter Colliers report.

Crow Holdings, based in Dallas, recently paid $32.5 million for the Turtle Crossing shopping plaza in Coral Springs. In Hialeah, Horizon Properties acquired the Publix-anchored El Mercado Plaza in Hialeah for $33 million.

Last month, a company managed by Hollywood-based real estate investor Todd Nepola bought a Dollar General-anchored shopping center in Margate for $10.7 million, and Miami-based Zenix Properties spent $13.5 million for the fully-leased Promenade Shoppes in North Lauderdale.

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Google Street View of the building at 11441 Northwest 107th Street in Miami-Dade County and Lawsuit winner PriceSmart CEO Sherry S. Bahrambeygui (Google Maps, LinkedIn)

The biggest membership warehouse club operator in Central America and the Caribbean won a roughly $4.4 million award in a lawsuit alleging faulty construction at its Flagler Station warehouse.

PriceSmart claimed in its complaint that the concrete floor slab at its 323,494-square-foot facility at the sprawling industrial complex in northwest Miami-Dade County had cracks. In some places, the fissures widened to holes and pits, endangering employees and heavy duty equipment, according to the complaint.

PriceSmart filed suit in 2019 and amended its complaint last year, suing general contractor Marcobay Construction as well as an affiliate of Flagler Global Logistics, which developed Flagler Station. PriceSmart also sued FGL Property Company, which was a guarantor.

Flagler Global Logistics is a subsidiary of Miami-based Florida East Coast Industries, which in turn is the parent of the Brightline passenger train.

PriceSmart paid $45.6 million for the land at 11441 Northwest 107th Street, records show. The price included an agreement that the Flagler Global Logistics affiliate would build the facility. The deal closed in 2017, after the warehouse was completed, according to PriceSmart’s complaint.

The claims against the Flagler Global Logistics affiliate and its guarantor were settled in September, while those against Marcobay Construction went to a three-day bench trial.

Following that trial, Miami-Dade Circuit Judge Michael Hanzman last week ruled against Marcobay, determining that the entire warehouse floor has to be replaced.

PriceSmart proved “replacement is necessitated by the [shoddy] workmanship and defects
in the original floor,” Hanzman said, according to a transcript of the hearing last week. “They are not required to take what is a pair of blue jeans and try to turn it into a tuxedo. They bargained for a tuxedo, they paid for a tuxedo, and they [are entitled] to rip up this pair of blue jeans they got and lay a proper tuxedo, period.”

The transcript also shows that Hanzman reduced an expert-determined floor replacement cost of $4.8 million by a couple of hundred thousand dollars for items he concluded were not compensatable. This brought down the final award to roughly $4.4 million, according to PriceSmart’s attorney Eleanor Barnett.

A written order with the final amount is expected to be issued in the coming days. The final award is to be reduced by the amount PriceSmart received in a settlement with Flagler Global’s affiliate, according to the hearing transcript. Although the settlement is confidential, the hearing transcript shows it was for $2.1 million.

Barnett said that PriceSmart continues to use the space, but the floor issue has been a “hindrance.”

“They spent $45 million for the land and the building of the warehouse and they got a defective floor. It was clear there were workmanship errors,” she said. The judge “understood that it is likely a systemic problem throughout the entire floor and the most cost-effective way to repair it is to start over again.”

Marcobay Construction and its attorney did not immediately return a request for comment.

In court filings, Marcobay in part argued it bears no fault because the alleged cracks resulted from “the floor being under-designed for the use of the heavy forklifts and equipment” like those that PriceSmart uses.

Also, the issue partly stems from a vague description in the construction agreement that merely said PriceSmart will use the facility as a warehouse and distribution center, Marcobay argued in court filings. This could mean anything from warehouses using forklifts weighing up to 12,000 pounds to warehouses using much smaller machinery.

“As a result of this failure to communicate, the engineers and architects failed to adequately design the warehouse floor for the wear caused by” PriceSmart’s heavy forklifts, Marcobay said in an August 2020 filing.

The Flagler Global Logistics affiliate placed blame on the warehouse architect, structural engineer and two labor and materials subcontractors. Most of these claims were put to rest as part of the September settlement, and any remaining claims against subcontractors also were resolved before the trial, said Flagler Global Logistics attorney Albert Blair.

“We are pleased we were able to resolve, amicably, all of PriceSmart’s claims, as well as all of our claims against the general contractor and subcontractors who actually performed the construction work at the warehouse,” he said.

Publicly traded, San Diego-based PriceSmart, led by Sherry Bahrambeygui, recently started an expansion into South America, opening membership warehouse clubs in Colombia. It was founded in 1993 by Sol and Robert Price, who also founded warehouse store chain The Price Club.

Lawsuits alleging construction defects are common in South Florida, and have targeted some of the area’s biggest developers and construction companies.

Last year, the condo association for Biscayne Beach in Miami sued developer Two Roads Development, general contractor Plaza Construction and 14 other companies alleging construction defects. The same year, the ​​condo association for Faena House in Miami Beach also sued the developer, general contractor and subcontractors for a laundry list of alleged construction defects.

And in 2019, condo owners at One Ocean condo tower in South Beach sued Jorge Pérez’s Related Group over allegations of shoddy construction.

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Zillow CEO Rich Barton (Zillow, iStock)

Zillow’s withdrawal from iBuying will weaken its second-place position in that sector, but its absence will likely be short-lived, according to analysts.

The market punished Zillow’s stock and rewarded that of its primary competitor, market leader Opendoor, after Zillow’s announcement Monday that it would cease buying homes through its Zillow Offers program for the rest of the year as it works through a backlog of inventory.

Zillow’s leadership cited challenges operating in a “labor- and supply-constrained economy inside a competitive real estate market.” But that rationale leaves several unknowns, analysts said. While investors see quarterly home sales figures, they don’t have much insight into how Zillow or its competitors decide what homes to buy, or how they source labor and materials for renovations.

Zillow, Opendoor and other iBuyers such as Offerpad and Redfin allow customers to request instant offers for their homes. The iBuyer then buys the property, renovates it and re-lists it for sale, aiming to profit on the flip.

U.S. home prices have smashed records this year, but investors wonder whether Zillow, with its deep data resources, might see warning signs others do not, said D.A. Davidson & Co. analyst Tom White, who rates Zillow at “buy.”

“The big debate for this group over the last few months has been, how does this business model fare when home prices do something other than just go up, up, up?”

Zillow’s announcement ahead of its third-quarter earnings is likely an attempt to “control the narrative,” said Oppenheimer analyst Jason Helfstein, who rates Zillow at “perform.”

Opendoor, Offerpad and Redfin do not seem to be encountering the same challenges sourcing labor and materials for renovations and closing sales, he said.

Indeed, Offerpad announced shortly after Zillow’s statement that it will soon be launching in California for the first time.

“Offerpad is continuing business as usual on our iBuyer side and with our other Offerpad offerings,” a company spokesperson said in an email. “There is no slowdown here.”

Opendoor, meanwhile, is “open for business and continues to scale and grow,” the company said.

Opendoor and Offerpad are pure-play businesses and have been in the iBuying sector a few years longer than Zillow, which entered in 2018. But Zillow’s estimated 34 percent market share is now second only to Opendoor’s 48 percent, Helfstein said.

Zillow bought 3,805 homes in the second quarter, a record high for the company and more than double its first-quarter figure, and sold 2,086. Opendoor bought 8,494 homes and sold 3,481.

Many Zillow investors were betting on the company’s continued success in the high-growth iBuying market, which, in the early days of the business, seemed to hinge on its borrowing capability, Helfstein said.

“In a higher interest rate environment, that might be the case,” said Helfstein, who cited Zillow’s “very healthy” balance sheet. “But in the current environment, where money is basically free, it looks like the limiter to growth is your ground game — your ability to refurbish these homes quickly and cost effectively.”

Zillow’s temporary withdrawal represents an “execution error” and a “lost opportunity” for the company, but it is a problem that can be resolved, Evercore ISI analyst Mark Mahaney said.

Mahaney, who rates Zillow at “outperform,” still likes the company’s core advertising business and the opportunities its dominant residential real estate platform affords. iBuying was a natural strategic pivot for Zillow, and he expects the company to revamp the business by early 2022.

“It’s better to stop something because you can’t keep up with the demand than to stop something because there is no demand,” Mahaney said. “Maybe that point got lost yesterday.”

After taking a 10 percent hit Monday, Zillow’s stock price rebounded 4 percent on Tuesday, closing at $88.86.

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Roger Huguet, former media executive, in front of 30 Island Drive in Key Biscayne, FL (Twitter/RogerHuguet, Redfin, iStock)

A former Spanish language media executive ensnared in the 2015 FIFA soccer scandal sold his waterfront Key Biscayne home for $8.3 million.

Roger Huguet and his wife, Marta Turon, sold the house 30 Island Drive, which was previously owned by Hollywood producer Carmen Soriano. The buyer is Daniel M. Ross, records show.

Giulietta Ulloa and Jennifer Perez with EWM Realty represented the sellers, and Daniel Rosa with Gary Hennes Realtors represented the buyer.

The couple sold the 3,636-square-foot house with four bedrooms and four-and-a-half bathrooms for $3.1 million more than their purchase price in 2015. That same year, Huguet pleaded guilty to two counts of wire fraud and one count of money laundering for his role in bribing officials from the Federation Internationale de Football Association, aka FIFA, the governing body for international soccer tournaments, including the World Cup.

At the time, Huguet was terminated from his job as CEO of Miami-based Imaginas US, the Americas division of a television media company in Spain with the same name. The explosive criminal probe revealed sports marketing and media executives colluded with officials from FIFA’s continental soccer organizations, CONMEBOL, which oversees South America, and CONCACAF, which oversees the Caribbean, Central America and North America, to secure lucrative soccer marketing and media contracts.

Huguet allegedly entered into an agreement with an executive from another sports marketing and media company to split the cost of a bribe to Jeffrey Webb, then-president of CONCACAF, according to published reports. In addition to Huguet, Imagina and two other company executives also pleaded guilty. Huguet’s sentencing hearing has been postponed 10 times since 2016, according to his criminal court docket.

Turon, his wife, is a vice president with Imaginas US.

Built in 1967, the Key Biscayne house sits on a 15,000-square-foot lot with a 120-foot seawall and direct ocean access, according to Zillow. Huguet and Turon upgraded the house during the last six years, including redoing the pool and adding Miele & Viking appliances and wine coolers in the kitchen, and high-impact windows and window treatments throughout the house, according to the listing.

Over the summer, Key Biscayne experienced a number of high profile sales. In August, developer Eric Soulavy and his wife, Cristina Soulavy, sold a waterfront house in Key Biscayne for $9.1 million. The same month, Peruvian billionaire Eduardo Belmont Anderson bought a waterfront home for $14.6 million. In May, German TV personality Alexandra Klim-Wiren and her husband Carl M. Wiren purchased a waterfront house for $14.9 million.

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Brett White (Executive Chairman & CEO, Cushman & Wakefield) & Stephen Rosenberg (Founder & Corporate CEO, Greystone) (cushmanwakefield.com, greystone.com, iStock)

Cushman & Wakefield is expanding its offerings in a hot rental market, adding lending and loan services to its multifamily capabilities.

The company agreed to pay $500 million for a 40 percent stake in Greystone’s agency, Federal Housing Administration and servicing business, according to the Wall Street Journal. Cushman will be able to make loans to buyers and owners, as well as service those loans.

Greystone — a giant in the rental lending business, originating $16.6 billion in loans in 2020 — will continue to operate the business, according to the Journal. The deal between Cushman and Greystone is expected to close by the end of the year.

Cushman was already heavily involved in rentals, serving as a brokerage in representing sellers in more than $11 billion worth of deals in 2020. The company also acquired Pinnacle Property Management Services last year as Cushman marches towards a full slate of multifamily services.

The rental apartment market has been on the rise in recent years. Additionally, August rents rose in 30 of the top American cities, the first time since the pandemic that all cities experienced growth. The national average rent that month hit $1,539, a 10.3 percent increase from the previous year.

Amid high rents and high home sale prices alike, bidding wars have reportedly broken out in New York City, a phenomenon usually seen in the housing market.

Greystone is active in the multifamily market, particularly in South Florida. Earlier this year, the company sold the 94-unit Villas at Cove Crossing in Lantana to real estate tycoon Benjamin Mallah for $9.9 million. The deal worked out to more than $105,000 per unit.

More recently, Greystone Servicing provided a $23.5 million loan to Circle Capital for the $34.7 million purchase of the Vue on 67th apartment complex in Davie.

[WSJ] — Holden Walter-Warner

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Surfside collapse mediation reveals opposing sides digging in heels on disbursements (Getty)

Mediation talks on divvying up disbursements among victims of the Surfside condo collapse have hit a stalemate, revealing two opposing sides that pit survivors who lost their homes against those who lost loved ones.

In total, roughly a dozen views have been expressed on how funds should be allocated. But ultimately, opinions fall into three major groups, including some arguing mediation is premature, mediator Bruce Greer told the court at a Wednesday morning hearing.

The other two groups offered opposing views: Some survivors argue they are entitled to the entirety of the land sale and building insurance proceeds as reimbursement for losing their units, and anything more would be for wrongful death claims, Greer said in court. Yet, those who lost loved ones argue that not only should unit owners not get reimbursed for the loss of their homes, but they should be assessed to pay for wrongful death claims and potentially be exposed to individual liability claims.

“Those two points could not be further apart, and could not be more vigorously asserted,” by attorneys, Greer said.

Meanwhile, the nearly 2-acre oceanfront land — where the 12-story Champlain Towers South collapsed four months ago, killing nearly 100 people — is on the market and drawing interest.

Stalking horse bidder, Dubai-based Damac Properties, set the floor price at $120 million. Others have expressed interest in offering more, making an auction likely in late February or late March, Avison Young broker Michael Fay, charged with marketing the site, said in court. Interest has come from Canada, Mexico, the United Kingdom and New York, he said.

In addition, roughly $49 million will come from building and liability insurance.

Still, Miami-Dade Circuit Judge Michael Hanzman, who is presiding over the collapse litigation, has said these proceeds won’t be enough to reimburse victims of the tragedy.

Hanzman had appointed attorney Greer to try to mediate disbursement issues through negotiations with attorneys representing the two major classes of victims. The appointment was a way to hash out the disbursement issue early on and not delay it until the land sale proceeds come in.

Greer on Wednesday recommended stopping mediation, citing one group’s opinion that talks are premature. But attorneys for victims countered that negotiations so far have been productive and that this is not an easy process, prompting Greer to agree to continue mediation.

Hanzman, who disagreed with the view that mediation is premature, said that complete unanimity among victims is not expected at mediation, and those who disagree will be heard by the judge. But if neither of the opposing sides budges, then the issue of disbursements will be hashed out in court, which could take years, Hanzman cautioned.

“If you can’t resolve this, I am going to call balls and strikes,” he said. “This court will go where the law takes it.”

This could mean a middle ground, where proceeds are divided pro rata, or it could mean that one of the opposing views turns out to be legally correct.

“Someone may be right, and someone may be wrong. It is what it is,” Hanzman said. But “absent a compromise, one group or the other may come out very, very disappointed.”

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Millennium Management founder Israel Englander and the Sabadell Financial Center (Millennium Management, 1111 Brickell)

Billionaire Israel Englander’s Millennium Management is the latest Northeastern financial firm to head to South Florida, with plans to open an office in Miami’s Brickell.

New York-based Millennium Management inked a long-term, more than 74,000-square-foot lease at the Sabadell Financial Center, where the hedge fund will open an office for investment and technology employees, according to a news release. Global quantitative investment firm WorldQuant, whose parent is Millennium, will take up part of the space.

CBRE closed the deal.

Millennium Management, with more than $57.4 billion in assets under management, was founded in 1989, according to its website.

The 30-story Sabadell Financial at 1111 Brickell spans 524,000 square feet. It was built in 2000 as part of a larger mixed-use complex that includes the adjacent JW Marriot Hotel on Brickell Avenue.

Landlords KKR, a global investment firm, and Parkway Property Investments, a privately owned real estate investor, bought Sabadell Financial in 2018 for $248.5 million. PGIM Real Estate was the seller.

Since then, KKR and Parkway Property have given the property a facelift, including a redesigned entrance and revamped lobby, according to the release. They also added multiple points of fiber entry and cell phone signal technology.

The lease is yet another example of the region becoming a magnet for out-of-state financial firms, which are either expanding here or are relocating altogether.

Brickell has proven to be a top choice. Canadian asset and wealth management behemoth CI Financial will open its new U.S. headquarters in a 20,000-square-foot space at the 830 Brickell tower that is under construction.

Miami also is making a bid to become a tech firm hub, a push that has political support from Mayor Francis Suarez. In September, Microsoft inked a 50,000-square-foot lease for its regional headquarters, also at the 830 Brickell tower.

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