The identity theft charges use Oceana Bal Harbour and Mei Miami Beach condos (Oceana, Mei, iStock, District Court of South Florida)

When Carlos Rafael Castaneda Mendez embarked on a scheme to take out fraudulent mortgages, he set his sights on four high-end residential properties in South Florida that neither he nor his accomplices owned, according to prosecutors.

Castaneda is one of seven people sentenced this week for their roles in what federal authorities say was a $10 million mortgage fraud and identity theft scheme.

From May 2019 to May 2020, the strategy was to pose as the property owners, using fake passports and driver’s licenses, open bank accounts in the owners’ names, and take out loans on the real estate, the indictment states. The co-conspirators used the funds to splurge on payments for a Mercedes-Benz Sprinter and watches.

The first step of the plot: To find luxury homes with absentee owners and no outstanding loans or liens, according to court filings.

Ringleader Castaneda settled on two condos at Oceana Bal Harbour, one unit at the Mei condo in Miami Beach and a six-bedroom Pinecrest mansion at 9000 Southwest 63rd Court, prosecutors say.

The seven co-conspirators received reduced sentences after they pleaded guilty to some of the counts, and signed plea agreements and statements, court records show.

Castaneda was sentenced to 78 months imprisonment, Alejandro Boada Oliveros to 46 months, Jonnathan Jesus Gonzalez to 44 months, Yanjeisis Alejandra Pompa Villafane to 28 months, Lilia Rosa Morales Moreno to 30 months, and Katherine Hansen Mendoza to seven months. All are of Miami, except Villafane, who is of Hialeah.

Isbel Rodriguez Batista, who was sentenced to 30 months, is of Teaneck, New Jersey.

Castaneda’s attorney said he was facing up to 121 months imprisonment, but his sentence was reduced “due to his acceptance of responsibility and other mitigating factors.”

“I think that was a sufficient, but not greater than necessary, sentence,” said the attorney, Sherleen Mendez.

Attorneys for some of the others claimed their clients had minor roles or fell victim to exploitation by con men.

Morales Moreno, a “struggling immigrant,” was manipulated into getting entangled in the plot by one of the others sentenced, said attorney Celeste Siblesz-Higgins.

“He took advantage of her situation, seduced her, and then took advantage of their relationship to get her to commit a crime. Nevertheless, she admitted her involvement to the judge who sentenced her fairly and appropriately,” said Siblesz-Higgins, who did not identify the collaborator she said exploited Moreno. “South Florida is filled with fraudsters who take advantage of the rich, as well as the less advantaged.”

According to Morales Moreno’s statement, she impersonated the owner of one of the Oceana units using a fake Venezuelan passport with her own photo to obtain a $1.1 million loan. The passport was created by others involved in the scheme, using the true owner’s name and “Cedula” number, the Venezuelan equivalent of a Social Security number.

Rodriguez Batista was involved in an attempt to take out a $700,000 loan that did not go through, said her attorney, Silvia Beatriz Pinera-Vazquez. The court agreed she “played a minimal role in the conspiracy,” and the court and prosecutors also agreed she is not on the hook for any restitution.

“Ms. Rodriguez was the only defendant that did not garner any benefit from the scheme,” Pinera-Vazquez said. “During sentencing, Ms. Rodriguez expressed her sincere remorse to the court for her actions in this case.”

According to her statement, she impersonated the owner of the Mei condo using a fake Spanish passport with her photo. But when she tried to take out the loan in May 2020, an undercover agent posing as a loan processor arrested her after she signed the mortgage documents, her statement reads.

As for Gonzalez, he “and his girlfriend were preyed upon by a more sophisticated individual who used them to commit a serious financial crime,” his attorney, Ana Davide, said via email. Gonzalez “accepted responsibility and is ready to move on with his life,” she said.

Hansen was trying to transfer $305,000 at a TD Bank in Miami from one of the fraudulently opened bank accounts. She was using a fake Venezuelan driver’s license and passport with her photo, but with the name and Cedula number of the real owner of the Pinecrest home, according to her statement. When the wire did not go through because of insufficient funds, an off-duty police officer on assignment at the bank branch approached Gonzalez, who was waiting in a white Range Rover outside the bank.

In the car, the officer saw a driver’s license in the cup holder with a photo of Hansen, and asked Gonzalez about it, according to Hansen’s statement. Gonzalez said it is his girlfriend’s, who is inside the bank. The officer went back to the bank and asked Hansen for identification, and she showed him the fake documents. She was detained and then confessed to her true identity, according to her statement.

Attorneys for Hansen, Oliveros and Villafane did not return requests for comment.

South Florida’s luxury residential real estate often appears in allegedly fraudulent schemes.

In September, the Securities and Exchange Commission filed civil charges against a Miamian who allegedly ran a $66 million payday loan scheme and diverted some of the money to pay for a $1.5 million unit at Epic Residences & Hotel.

The post $10M mortgage fraud honed in on Oceana Bal Harbour, Mei Miami Beach condos appeared first on The Real Deal South Florida.

Single-family rentals are increasingly seen as a more realistic alternative to ownership, given the hot housing market and income inequality. (iStock)

Americans are finding homeownership increasingly out of reach or not worth the commitment, and are instead turning to the next closest thing: single-family rentals.

Built-to-rent homes, which are constructed for single families as rentals, were surging even before Covid. The pandemic accelerated the trend, as the number of built-to-rent homes soared by 30 percent from 2019 to 2020, according to the New York Times.

Built-to-rent homes make up 6 percent of all homes being constructed in the United States, and according to the Times, that number could double in the next decade. It is the fastest-growing housing sector in the country.

Single-family rentals now take up a significant market share of the rental sector itself. These properties make up approximately 35 percent of all U.S. rentals.

The advantages of single-family rentals are plentiful for Americans who are coping with a housing market boom and often lack savings. They don’t have to worry about a down payment for a home, the standard for which is 20 percent, or about $75,000 for a median-priced home in the U.S. Closing costs on home purchases cost thousands more.

Additionally, landlords are responsible for maintenance and repairs, so renters are off the hook for unexpected problems and large expenses. Four in 10 Americans don’t even have $400 for emergencies.

Another advantage of renting is flexibility, especially for people who aspire to be in a different neighborhood or city, or whose work could take them elsewhere. Personal financial advisers typically say anyone buying a home should plan to live there for at least five to seven years.

One shortcoming of renting is that tenants typically do not match the savings that homeowners accrue by building equity in their property. For many owners, their home becomes their most valuable asset.

“The only downside is you’re going to lose out on the investment aspects of homeownership,” University of San Diego real estate finance professor Norman Miller told the Times of the shift towards rentals.

Americans looking to jump in on the single-family rental craze are likely to find yet another expensive proposition, though. Through the end of July, asking rents for single-family rentals have soared nearly 13 percent year-to-date, the highest increase in five years. Renters do not have the equivalent of a 30-year, fixed-rate mortgage.

Rent increases appear to be accelerating throughout the year, too. Asking rents jumped 7.2 percent year-over-year in March, 8.6 percent in April, 10.5 percent in May, 12.2 percent in June and 12.8 percent in July, per data from Yardi Matrix.

[NYT] — Holden Walter-Warner

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From left: Francisco Llado, Gil Dezer, Amir Korangy, Paulo Bacchi, Edgardo Defortuna, Jay Parker, Daniel de la Vega (Artefacto, Getty)

To break up the glass-and-steel monotony of his next planned condo tower, developer Gil Dezer will be spending extra money to create a dramatic design element.

His Dezer Development is teaming up with Bentley to build the Bentley Residences in Sunny Isles Beach, which will be the luxury automaker’s first residential building in the world.

During an architecture panel Thursday evening, Dezer revealed one of the project’s features, triangular windows fastened together to look like diamonds, increased construction costs by more than $10 million.

“We had to go ahead and do a ton of testing and really create [the windows] because it has never been done before,” Dezer said. “This is costing me $12 million to $14 million more” than if he were to install standard three-foot wide condo building windows.

Dezer was among five speakers on a panel about the impact of architectural design in Miami’s real estate market, moderated by Amir Korangy, chairman and publisher of The Real Deal. The event was hosted by Paulo Bacchi, CEO of Artefacto, at the high-end furniture store’s new Coral Gables showroom at 101 South Dixie Highway.

Roughly 500 attendees packed the 40,000-square-foot building, sipping champagne and mingling amid the furniture displays. The evening culminated with a samba band and dancers taking to the stage.

In addition to Dezer, president of Dezer Development, the panel included Edgardo Defortuna, president and CEO of Fortune International Realty; Daniel de la Vega, president of One Sotheby’s International Realty; Francisco Llado, principal of DOMO Architecture + Design; and Jay Parker, CEO of Douglas Elliman’s Florida region.

Korangy pressed the panelists about a perceived lack of originality in recent designs of condo buildings and modern mansions in Miami. “I am starting to see it repeat itself,” Korangy said. “It’s becoming saturated. It is starting to look the same, even for the new homes. I love the new Miami homes with the flat roofs and the windows.”

Those elements are being replicated across Miami’s luxury market, Korangy added.

The panelists insisted developers and architects are creating residences that are in high demand from luxury buyers, but that also incorporate design elements that create a distinctive home.

Llado, whose firm specializes in designing custom mansions, said developers, architects and brokers are dealing with very sophisticated buyers who are telling them what to do. “Our houses have changed from 10 years ago when it was a white painted stucco, quick spec home,” Llado said. “Now they want wood outside, marble, Raymond Jungles [landscaping] outside, and inside I want Artefacto.”

De la Vega said the differences are subtle when it comes to the contemporary box structure with large glass treatments of modern mansions. “We got a little bored with that,” he said. “We are starting to see more organic architecture; more textures and more patterns. That is what all buyers are demanding from us.”

“People are looking for lifestyle,” said both Defortuna and de la Vega, and others agreed.
In his dealings with buyers, Defortuna said they are more interested in simplicity, quality and attention to detail than a very heavy design. “They want spaces that can be utilized,” he said. “It is not about big spaces that are not used, especially in buildings with hospitality services….You can have a party with a guest chef for 12 of your best friends or best couples. That is what they want.”

Parker said buyers want the white box modern home with floor-to-ceiling windows so they can allow more light into the home and enjoy South Florida’s subtropical climate. “When you talk about buyers coming from out of town, they want to enjoy the indoor and outdoor experience,” Parker said.

The post Is Miami’s residential architecture overplayed? No way!: TRD panel at Artefacto appeared first on The Real Deal South Florida.

Stephen A. Schwarzman, CEO of the Blackstone Group (Getty Images, iStock)

Blackstone reported a blockbuster third-quarter this week — the best in its 36-year history.

Earnings more than doubled year-over-year to $1.28 per share, trouncing the average Wall Street analyst estimate of 91 cents. And assets under management swelled 25 percent to $731 billion, besting industry records, said Stephen Schwarzman, the firm’s chairman and CEO.

A workhorse behind that growth: real estate.

A look at the firm’s assets under management shows real estate investment grew to $230 billion — the highest percentage increase among Blackstone’s segments, which include private equity, hedge fund solutions and credit and insurance.

Behind private equity, real estate investments posted the greatest appreciation at 36 percent year-over-year. For investors, the segment brought in the thickest slice of distributable earnings at $2.6 billion.

The firm’s Core+ business, long-term investments in residential, office and life sciences, plus the private real estate investment trust BREIT accounted for much of those gains. Core+ was the largest driver of perpetual capital and fee-related earnings, said Jonathan Gray.

Institutional and retail investors raised $10 billion for the platform in the quarter, and $7.9 billion of that funneled into BREIT, Gray said, topping a record second-quarter.

Behind the top-tier figures were deals for the books and aggressive investment in its favorite sectors.

Late last month, Blackstone closed on its $5.6 billion sale of The Cosmopolitan of Las Vegas, a hotel and casino on the Strip. The deal was the most profitable single-asset sale in history, said the firm, which stood to make $4 billion, or 10 times the equity it invested.

True to its second-quarter promises, Blackstone re-entered the hospitality sector and purchased the land on two Las Vegas Strip hotels for $3.89 billion with plans to lease it back to prior owner MGM Resorts International.

The mammoth company finalized its acquisition of single-family rental firm Home Partners of America for $6 billion and privatized the data-center operator QTS Realty Trust for $10 billion.

Those buys add to the firm’s ongoing industrial play. In August, BREIT snapped up WPT Industrial Real Estate Investment Trust for $3.1 billion. In the past year, Blackstone has picked up warehouses in California, northern New Jersey and Pennsylvania for $358 million and secured $944 million in financing for a West Coast logistics portfolio.

During the earnings call Thursday, Gray said $30 billion in deals were still pending and named rental housing as one of the quarter’s largest investments still in the works.

Looking forward, the firm touted its European expansion through the Blackstone European Property Income Fund, which offers individual investors access to institutional-quality real estate, according to the business’ website. Blackstone expects to see money from BEPIF next quarter.

“It’s early days,” Gray said. “But we’re a bit of a trailblazer like we were with BREIT when we revolutionized the non-traded REIT market.”

The post Real estate powers Blackstone’s best quarter ever appeared first on The Real Deal South Florida.

Buyer Andrew Korge with renderings of the project (Korge)

Two Miami-based investors paid $6.5 million for a development site along the western bank of the Miami River, as growth along the river creeps inland.

Andrew Korge’s Korgeous Development bought the nearly 2-acre industrial-marine property at 3007 Northwest South River Drive, with plans to eventually redevelop it, according to the deal’s broker. The property is in an unincorporated area west of Miami.

Jorge Fernandez, formerly of the Related Group, is a co-buyer of the property. Bruno Ramos is the seller.

Michelle Ash of Simply Marinas brokered the deal on behalf of the seller and buyer.

A specific project plan has not yet been hammered out, but options include office-industrial and residential with more than 300 units. The property currently houses a 10,000-square-foot office building and a 4,000-square-foot warehouse. The site has a grandfathered marine use, meaning any new project is expected to include either dry storage, dockage or wet slips.

In the meantime, Ramos has leased back the entire property, where he runs his architecture firm and heavy construction equipment rental business.

Development along the Miami River has been booming in recent years, but mainly stayed focused on the eastern edge near Biscayne Bay, Brickell and the Health and Civic districts.

Land along the western river banks traditionally has been industrial-marine in use, but a rezoning six years ago that includes this site now allows for residential development, Ash said. This is catching the eye of investors, and development is poised to move west along the river, where land still is cheaper than along the eastern bank, and allows for more upside potential, she added.

The property that sold traded for $3.4 million per acre. “Down in Brickell, you can’t get anything for less than $13 million an acre,” Ash said.

In another sign of westbound river development, ROVR Development and its partner bought a mobile home park last year near Korgeous’s site for $15 million.

Korge also is partnering with Integra Investments and David Larson of DCL Capital on the 380-unit Biscayne Shores project at 11295 Biscayne Boulevard, north of Miami Shores. The trio bought the site for $15.5 million last year.

The post Miami River’s western bank poised for growth with $7M dev site purchase appeared first on The Real Deal South Florida.

George Gleason (Bank OZK)

Bank OZK, one of New York and Miami’s most active construction lenders, saw loan originations reach their highest levels in nearly four years.

Arkansas-based Bank OZK’s Real Estate Specialties Group closed $2.21 billion of new loans during the third quarter, marking the highest quarterly level of originations since the fourth quarter of 2017. The bank also recorded almost zero write-downs on problematic loans.

The mid-size bank, led by George Gleason, is closely watched by the real estate industry as a bellwether of the appetite for ground-up construction loans. Bank OZK, formerly known as Bank of the Ozarks, has also been the target of short sellers who say the bank’s out-of-market loans and real estate-heavy portfolio could be problematic in a market downturn.

Bank OZK showed little signs of distress in the third quarter, according to a Friday earnings call.

Originations in 2021 will likely exceed the record of $5.67 billion in 2019, the bank said. Its RESG division closed 23 loans with an average size of $96 million in the third quarter.

“The market is pretty active right now,” Brannon Hamblen, head of the bank’s RESG division, said on a third quarter call with analysts. “There are a lot of people trying to get a lot of transactions closed after a quieter year in 2020.”

Bank OZK did not discuss its New York City loans — the bank’s largest market— on the call. In its accompanying management comments, Bank OZK mentioned that loan volume in the city will likely fall in the short-term.

“The volume of new opportunities meeting our standards in the market (NYC) has not been as great in recent years,” the bank said.

Bank OZK’s RESG loan commitments in the NYC MSA fell to $3.87 billion in the third quarter from its high of $6.95 billion in the fourth quarter in 2018. The bank also closed its only deposit-taking branch in New York, but is keeping its local real estate lending office, according to management comments.

Hamblen, speaking generally, said the bank has seen a lot of lending opportunities for multifamily projects, mixed-use projects and even office developments.

Bank OZK’s RESG division reported a dip in loan repayments from the previous two quarters. Borrower repayments dropped to $1.34 billion from $1.68 billion in the second quarter. The company said some loan repayments expected to occur in the third quarter were pushed into the fourth quarter of 2021. Yet, the bank still expects repayments in 2021 to exceed 2019 levels, according to its management comments.

Bank OZK reported $130.3 million of net income, a 19.3 percent increase from the third quarter of 2020.

The company also set for new initiatives in the third quarter, including building out an “Equipment Finance and Capital Solutions Group” to provide equipment financing and lease structures. In the second quarter, the bank started an asset-based lending group.

Bank OZK’s stock was down 2 percent to $44.52 midday Friday.

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Charles H Johnson (U.S. military veteran & estate lawyer at Day Pitney LLP) and views of 855 S Ocean Blvd (realtor.com, daypitney.com)

An oceanfront Delray Beach mansion changed hands for a princely sum of $34 million, double the seller’s purchase price eight years ago.

Records show Charles H. Johnson, a U.S. military veteran and estate lawyer, sold the nearly 20,000-square-foot home to a Delaware LLC that shares the same name as the property: 855 South Ocean Boulevard.

Nick Malinosky of Douglas Elliman in Delray Beach represented both the buyer and seller.

Built in 2008, the mansion last sold for $17 million in July 2013, records show.

It was listed Oct. 4 for $35 million, according to Redfin. According to the listing, the 1.3-acre property has five bedrooms, eight full bathrooms and two half-bathrooms.

This sale represents the latest in a series of high-priced real estate sales in the Delray Beach area.

This month, a healthcare investor paid $17.2 million for a lakefront mansion west of Delray Beach, on the heels of selling his Highland Beach estate for more than $30 million.

In August, New York Mets owner and billionaire hedge fund manager Steven Cohen paid $21.6 million for a waterfront mansion, also west of Delray Beach.

And in July, Randal Perkins, the founder of AshBritt Environmental, a national disaster response and environmental services contractor, flipped a Delray Beach oceanfront mansion for $21.9 million.

The post Attorney sells oceanfront Delray Beach mansion for $34M appeared first on The Real Deal South Florida.

(iStock, Wikipedia)

Major League Baseball teams next season will begin putting up some of their minor leaguers.

MLB said in a statement this week that team owners “agreed to begin providing housing to certain minor league players,” according to the Associated Press.

The statement said that the details of the policy had yet to be finalized and did not specify what players would be eligible for housing.

Other sources told ESPN that MLB would require teams to provide housing via stipends, paying rent directly, or otherwise arranging the housing themselves.

The changes are part of a wider restructuring of the MLB’s minor league system, prompted in part by pressure from advocacy groups and players.

After being signed by a team, players typically have to work their way through the three minor league tiers to get onto Major League rosters. Most never make it, and earn poverty wages while trying.

The system has even smaller regional leagues as well. In all, there are 209 teams across 19 leagues, according to the MLB.

The level of housing assistance currently offered to players varies by ball club. The Houston Astros, for example, began providing furnished apartments to all its players this season. But most teams only put players up on road trips, leaving them on their own to find housing near their home ballparks for seasons that run for three to six months — putting traditional 12-month leases out of reach.

Some resort to living in their cars or roach-infested dives.

For low earners in the U.S., finding a place to live is about as hard as it has ever been. Home prices have soared during the pandemic, and the increases have spilled over into the rental market. Meanwhile, localities continue to limit or forbid development of affordable housing, preferring to keep single-family zoning.

The major leagues did raise the minimum salaries for all minor league players last year, although the pay is still low. Arduous travel requirements were also eased.

Players at the highest minor league level, AAA, must be paid a minimum of just $700 per week of play. Players in the lowest tier, Single-A, can be paid as little as $500 per week of play.

That figures out to just $10,500 for a Single-A player over the course of a five-month season, below the $12,880 federal poverty line.

Players in the Mets and Phillies organizations last month wore teal wristbands for the last weekend of the season as a protest over the pay structure.

The Advocates for Minor Leaguers organization was involved with the protest and has in the past handed out pamphlets to fans to draw attention to the issue.

[AP] — Dennis Lynch

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(iStock)

Prices for new homes in China’s largest cities fell month-over-month in September for the first time since 2015.

Prices declined in half of 70 cities surveyed by the National Bureau of Statistics, according to the Financial Times.

Beijing saw no change in pricing, while Shanghai saw a 0.2 percent increase. Many of the cities where prices fell are in the country’s south and central regions.

Goldman Sachs calculated a 0.5 percent decline in pricing on an annualized basis with a seasonal adjustment, though prices were still up 3.8 percent over September 2020.

There has also been a decline in sales — Bloomberg figured that home purchases fell 17 percent in September year-over-year and 20 percent in August.

Instability in the China’s real estate industry and fears of a housing bubble prompted government intervention on both ends of the housing pipeline toward the end of the last year. That effort continues into this year.

Actions included imposing restrictions on debt to both developers and homebuyers in January.
Chinese developers have around $5.24 trillion worth of outstanding debt, according to Reuters.

Evergrande Group alone has around $300 billion in liabilities, making it the world’s most indebted developer.

The growth of new home prices slowed in the second half of 2020 and the first half of this year, but did not reverse entirely. 

A slowdown in homebuying could squeeze the country’s developers, which generally sell new properties before they are built via prepayments.

Many are already hurting — the real estate industry saw its first contraction since the start of the pandemic in the third quarter as output fell 1.6 percent year-over-year.

“In the first half of this year, many people still believed these property curbs would be temporary,” said Ting Lu, chief China economist at Tokyo-based finance firm Nomura. “As the Chinese government showed more and more determination in these property curbs, first and foremost Chinese households’ expectations of home prices changed.

[FT] — Dennis Lynch 

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A collection of images from the Turkey Track Ranch listing (Icon Global)

An 80,000-acre ranch in the Texas Panhandle is hitting the market for the first time in 120 years with an asking price of $200 million.

Turkey Track Ranch is a working ranch with fertile grasslands and oil and gas wells, according to the Fort Worth Star-Telegram.

The buyer would obtain a 40 percent stake in mineral rights and revenues from existing wells as well as any future wells. They would also receive wind and solar rights.

Bernard Uechtritz, founder of Icon Global Group, told the Dallas Business Journal he appraised the ranch by using an unconventional approach, instead of basing the price on a per acre basis of comparable value sale.

The ranch’s price is based on “its uniqueness and its scarcity and its one-of-a-kind values,” Uechtritz said, comparing the approach to his marketing of the 510,000-acre Waggoner Ranch, which listed for $725 million.

Turkey Track Ranch sits along 26 miles of the Canadian River near the town of Borger, north of Amarillo. It reportedly includes an unusually high amount of surface water for the region.

A marketing video from Dallas-based Icon Global Group, which is representing the families, calls the property “an oasis of the Texas Panhandle.”

A ranch of the same size in Montana listed earlier this year for around $136 million and a sale closed last month, although a price has yet to become public.

The ranch has been leased to Adobe Walls Cattle Company since 2009. The company is named after a former settlement on the property.

That was the site of the Battles of Adobe Walls in 1864 and 1874, both battles between local Native Americans and white settlers. A six-acre site was given to a local historical society in 1924.

The ranch was established later in the 1870s and has been owned by the Whittenburg and Coble families since the turn of the 20th century. They are descendants of past stewards Tom Coble and James A. Whittenburg III.

The property has been largely preserved under the families’ ownership and has received various environmental awards over the years, including the National Cattlemen’s Beef Association Environmental Stewardship Award in 2017.

In a statement via Icon Global, the Coble and Whittenburg families cited the ”family’s increasing numbers and geographical distances” as reasons to sell the property.

[Fort Worth Star-Telegram] — Dennis Lynch

The post An 80,000-acre ranch in the Texas Panhandle lists for $200M appeared first on The Real Deal South Florida.

An aerial of Quilpie (Google Maps)

A small town in the Australian Outback offered free land to draw in new residents. It worked almost too well.

Officials in the rural town of Quilpie, Queensland have been overwhelmed by more than 250 inquiries from as far afield as Britain, India, and Hong Kong, although only Australias or permanent residents are eligible, according to the Associated Press. Quil[pie, home to just 800 people, launched the program two weeks ago,

The Quilpie Shire Council is offering a grant equivalent to $9,400 to anyone who buys land, builds a house there for less than $560,000 and lives in it for at least six months. Quarter-acre blocks of land sell for about $9,400, so the land is effectively free.

“If we could get five new families to the shire, for us that would be a massive success,” said Quilpie Shire Council Chief Executive Justin Hanock. “To see the interest, it was a little overwhelming.”

Hancock conceived of the idea soon after he moved to Quilpie and lived in a retirement village for six months because he couldn’t find any housing. The council’s goal was to boost housing stock, the lack of which has made it hard for local ranchers to fill jobs.

Most interest came from the Queensland capital of Brisbane, about 600 miles east on the coast of the Pacific Ocean.

Towns across the world have turned to similar novel programs to attract residents and boost their economies.

Curtis, Nebraska and Marne, Iowa each offered to give away land to anyone who builds a house there.

Kansas is offering income tax exemptions for people who move to a select 77 counties in the state.

The Pennsylvania town of Monessen, outside Pittsburgh, recently offered to wipe back taxes on any vacant property if a new owner commits to renovating it.

[AP] — Dennis Lynch 

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A rendering of The Residences at 400 Central and John Catsimatidis (Catsimatidis via Getty)

Billionaire John Catsimatidis broke ground on the tallest tower on Florida’s Gulf Coast this week.

The 46-story condominium tower in St. Petersburg is also the first residential project outside New York and the first condo project for the developer and businessman’s Red Apple Real Estate. The project totals 1.3 million square feet.

The Residences at 400 Central is slated to rise on a full city block in the city’s downtown. Plans call for 301 condo units and a handful of penthouse units. They are a mix of one- to four-bedroom units with pre-construction pricing starting at $800,000.

A rendering of The Residences at 400 Central

Some 35,000 square feet of amenities are planned for the tower, including a gym, lounge and a theater. Residents will have access to an observatory on the 46th floor and a seventh-floor deck is to include a pool and spa, putting green and outdoor kitchen.

Sarasota-based Michael Saunders & Company is handling leasing for the project.

Catsimatidis, a developer who made his $3 billion-plus fortune in oil refineries, gas stations with convenience stores and Gristedes supermarkets, told the Tampa Bay Business Journal he expects some interest from his fellow Northeasterners.

“I think Northerners are tired of Covid, tired of the cold, they’re tired of criminals, and they’re moving on down,” he said.

The Greece-born New Yorker himself has recently signaled a preference for Florida over his hometown, at least in terms of their potential for investment.

Catsimatidis has been pushing to build three apartment towers in Coney Island as a complement to his 450-unit Ocean Drive project. He said he’d take his money south if the city didn’t approve his new plans.

“You’ve got to get the best for your investment,” he told the New York Post. “Why spend in New York when you can build in Florida?”

Still, the occasional New York City mayoral candidate appears to be a New Yorker at heart. Earlier this year, he was reportedly weighing a switch to the Democratic Party to give himself more of a chance at Gracie Mansion, but ultimately decided against it and said if he did run again, he would do so as a Republican or Liberal.

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Located in the Arabian Gulf, “THE RIG” will be the world’s first tourism destination inspired by offshore oil platforms. (Saudi Arabia’s Public Investment Fund)

Oil-dependent Saudi Arabia is taking literally the concept of economic diversification.

The kingdom has announced plans to convert an oil rig in the Arabian Gulf into a 1.6-million-square-foot “extreme park” and resort, according to CNN.

The Saudi Arabia Public Investment Fund is behind the project, dubbed “The Rig.” It would include three hotels, 11 restaurants, helipads, rollercoasters and activities such as bungee jumping, skydiving, and aquatic sports spread across a series of platforms.

Renderings show a concert venue and an underwater restaurant. One pictures a cruise ship docked at the rig. PIF didn’t release a planned completion date.

The project is part of a wider governmental push to develop the country’s tourism industry and diversify its economy under its Saudi Vision 2030 initiative.

PIF said in a statement that it hopes to attract ”tourists from around the world,” while targeting in particular people from Gulf Cooperation Council nations.

Meanwhile, construction is under way at Six Flags Qiddiya, outside Riyadh, with a stated completion date in 2023.

The park is anchored by The Falcon’s Flight, which upon completion could be the world’s fastest and tallest free-standing roller coaster, nudging out the Formula Rossa at Ferrari World Abu Dhabi in neighboring United Arab Emirates. It’s set to pull passengers around at about 155 miles per hour.

The nation is also seeking investors and brands from abroad. This summer, Sam Nazarian announced plans for a $100 million expansion into the country as part of a joint venture with WK Holding.

His company, C3, is set to introduce 40 international brands to the country, including Umami Burger and El Pollo Verde.

[CNN] — Dennis Lynch

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An aerial of 1300 Southeast 17th Street in Fort Lauderdale with Steven Hudson and Charles Ladd (Chapter Two Investments)

Steven Hudson and Charles Ladd Jr. are not slowing down their Broward County retail shopping spree, as they scooped up the Sunset Harbor Plaza in Fort Lauderdale for $40.5 million.

The real estate honchos, through their Chapter Two Investments, along with co-investors Las Olas Capital Advisors and Foreward Management, bought the retail-office property at 1300 Southeast 17th Street, according to a news release.

Las Olas Capital, based in Fort Lauderdale, and led by Paul Tanner, provided $18 million in equity financing through its Real Estate Fund III. Valley Bank provided a $20 million acquisition loan, according to the release.

The purchase closed in three deals from different seller entities, two led by Andrew Martin. The third seller is South Harbor Plaza Joint Venture.

The 91,634-square-foot Sunset Harbor spans 8.2 acres and has 750 feet of frontage along the 17th Street Causeway, according to the release. Martin developed it in 1982.

The plaza is 82 percent occupied, with tenants that include Mexican restaurant Carlos & Pepe’s, Clearsight Opticians, Carrabba’s Italian Grill and Stretch Zone.

Talks are ongoing with new tenants as well as existing tenants to extend their leases, Hudson said.

Hudson co-founded Fort Lauderdale-based Hudson Capital Group with his father, Harris “Whit” Hudson, in 1997, according to the firm’s website. Ladd leads Barron Real Estate, also based in Fort Lauderdale.

The duo’s Foreward Management will run Sunset Harbor.

This is Hudson and Ladd’s third retail purchase in South Florida this year. In June, they bought the Oakland Park Festival Centre at 3400-3580 North Andrews Avenue for $23.4 million, and the Primavera Plaza at 830 and 840 East Oakland Park Boulevard, also in Oakland Park, for $10 million.

They also partnered with Las Olas Capital on these purchases, as Las Olas’ Fund III had raised roughly $73 million for all three acquisitions, according to Hudson.

Their investment in retail is not surprising, as the South Florida market has shown signs of rebounding after last year’s lockdown.

Rents have surpassed pre-pandemic levels, as vacancy rates dropped. A Colliers third quarter report showed that Broward’s average asking rent reached $22.96 per square foot, up from a previous high of $22.83 a square foot in the fourth quarter of 2019.

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Are you a Marvel fan? Not the comics, of course, but the architect.

You may be after this week’s episode of “Deconstruct,” TRD’s new podcast for all things real estate. Host Isabella Farr is joined by top architects Jonathan Marvel and Bernardo Fort-Brescia to talk about paradigm shifts in office space and where architecture firms fit in.

With a portfolio showcasing cushy armchairs and indoor gardens, Marvel’s eponymous firm is looking to create spaces that not only spur productivity, but also feel good to work in. He and Fort-Brescia dig into some of the most exciting trends in design and how firms like theirs fared in 2020.

From the ivory tower, the episode also features Patrice Derrington, professor and director of Columbia University’s real estate development program, who shares how developers are adapting to changing notions of living and working.

In next week’s episode, “Deconstruct” follows the logical progression to look at the next real estate asset class — chronologically speaking, at least — after the office: senior living.

“Deconstruct” is streaming on Apple, Spotify and wherever else you listen to podcasts. Tune in for new episodes each week for all the information, insights and analysis you need to stay ahead of the curve.

The post This week on ‘Deconstruct’: The death of the cubicle appeared first on The Real Deal South Florida.

Though a majority of business leaders think hybrid work is here to stay, only 40% have taken steps to plan for its future. (iStock)

A majority of office-using businesses are yet to decide what their hybrid future should look like.

Hybrid work is underway in 72 percent of office-based companies and 65 percent said they don’t anticipate having any one dominant work location in the future, according to a new survey from Ernst & Young.

A majority of business leaders believe a hybrid work model is here to stay, but only 40 percent of the survey’s respondents said they have taken steps to establish a plan for its future.

“There’s a lot of big decisions to be made, and I think a lot of people are having a hard time making those decisions,” said Mark Grinis, EY’s global real estate, hospitality & construction leader. “The data shows that they’re taking a wait-and-see attitude.”

The survey from the professional services firm, also known as EY, involved more than 500 business leaders from across the country to launch its Future Workplace Index.

The reluctance to commit to widespread office returns comes as major U.S. markets struggle to emerge from depressed leasing activity.

Manhattan’s pandemic-powered office slump reduced net absorption in the past 18 months to negative 36.6 million square feet, or about the size of the office market in Downtown Los Angeles, according to Colliers International. The borough’s leasing activities finally rebounded in the third quarter, indicating that some companies finally started to make plans for the future.

The same period saw a record rate of workers returning to the office. An average of 36 percent of the workforce returned to offices in the 10 top U.S. office markets in the first week of October, according to access-card data from Kastle Systems.

New York City saw a promising rise of almost 10 percent in employees’ returning in September, reaching 30 percent of its workforce back in the office. But the figure pales in comparison to the 62 percent predicted by employers who responded to a survey for Partnership for New York City.

According to the EY survey, 87 percent of business leaders said the pandemic has changed the role of the office for their organizations. Of particular concern to office landlords, 57 percent said productivity has surpassed pre-Covid levels. On top of that, 72 percent said their corporate culture has improved while operating in a hybrid work model.

To make the office experience superior to a home environment so that employees want to come to their offices, landlords “need to recognize they are in more of a hospitality business than a four-white-wall business,” Grinis said.

Some commercial landlords appear to have already taken note of how to lure tenants back amid the market’s lowest points. The New York Times reported in June that office buildings were rolling out a previously unseen range of amenities.

In addition to ventilation systems, Zoom-friendly conference rooms and flexible seating for variable work schedules, some buildings debuted amenities focused on social and cultural attractions, the Times reported.

The post Landlords beware: Office tenants procrastinating on hybrid planning appeared first on The Real Deal South Florida.

A rendering of Terra’s CentroCity development with David Martin of Terra

Residential redevelopment of South Florida shopping centers is becoming more common, amid solid demand for rental housing and a slack market for retail space.

This month, Houston-based developer Morgan Group won a land use change to build 356 apartments on the site of a former Macy’s store and parking lot at Pompano Citi Centre, a shopping center in Pompano Beach on the southwest corner of Copans Road and Federal Highway.

“We haven’t seen many of these residential transformations at commercial centers, but I think you’ll start to see more of them as the centers unfortunately start losing tenants on a permanent basis,” said attorney Neil Schiller, a founder and shareholder of Boca Raton-based Government Law Group who represents real estate developers.

Art Falcone, Encore Capital Management

Shopping centers in densely populated areas are among the best in-fill sites for multifamily developments because they can meet the residential, occupational, and recreational needs of residents, said Art Falcone, co-founder and chief investment officer of Boca Raton-based Encore Capital Management.

“As South Florida gets basically built out, the opportunity now is combining live, work and play,” Falcone said. “People don’t like to be in cars and stuck in traffic.”

Falcone’s company acquired the 34-acre Fashion Mall in Plantation, demolished it, and is replacing it with Plantation Walk, a mixed-use redevelopment that ultimately will include 730 apartments. Tenants have started moving into two newly opened apartment buildings with 410 units, and Falcone expects construction of a third apartment building with 320 units to start early next year.

Plantation Walk

Falcone said Encore also has received certificates of occupancy for 130,000 square feet of new retail and restaurant space. Other completed projects at Plantation Walk include a Sheraton Suites hotel and a fully leased, 180,000-square-foot office building where insurance giant Aetna occupies half the space.

Newer mixed-use developments in South Florida commonly combine commercial space and rental apartments. Miami-based Terra developed Pines City Center in Pembroke Pines from the ground up with more than 300,000 square feet of retail and restaurant space and 400 apartments.

A positive market response to the residential options at Pines City Center encouraged Terra to acquire a 38-acre shopping center in Miami called Central Shopping Plaza, renovate the existing stores, including a former Kmart store that Target will occupy, and build apartments around them.

A rendering of Terra’s CentroCity development

The first phase of that redevelopment, called CentroCity, will include 460 apartments, and will be completed in 12 to 18 months, said David Martin, CEO of Terra. By 2024, he said, Terra plans to build a total of 1,100 apartments and 250,000 square feet of office space at the CentroCity property in Miami’s West Little Havana neighborhood.

At Pines City Center, “what we saw was a very strong symbiotic relationship. Residents loved living around a retail offering, and retailers liked having customers who can walk to the store,” Martin said. “It becomes a lifestyle offering for the residents and obviously increases the number of repeat customers” for the retail tenants.

Another large-scale redevelopment is expected to bring a residential component to the Boynton Beach Mall. Columbus, Ohio-based Washington Prime Group won a rezoning of the 108-acre mall in Boynton Beach for a redevelopment that would combine as many as 1,420 apartments and up to 400 hotel rooms with 629,000 square feet of retail space. Washington Prime Group recently emerged from Chapter 11 bankruptcy with a new CEO.

However, shopping center owners like Beth Azor are unlikely to redevelop their properties in the absence of low occupancy rates. Azor is founder and principal of Azor Advisory Services, a Weston-based company that owns six shopping centers in Broward County.

She has no plans for multifamily development at any of her shopping centers because they aren’t distressed – three are fully leased – and because developers are building hundreds of apartments near her centers in Davie, Plantation and Sunrise.
“There are so many wiser, more experienced, richer folks doing apartments, that I like to watch their success from my vantage point,” she said, citing her career as an investor in shopping centers. “After 35 years in the business, I know how to do those, versus trying to learn how to develop multifamily properties.”

The post New lease on life: Apartment projects popping up at distressed South Florida shopping centers appeared first on The Real Deal South Florida.

Entrepreneur Cesar Morales, owner/operator, Wood Tavern, Miami Mojito Company, Las Rosas Miami and other Wynwood establishments (The Daily Wood, Google Maps, iStock)

The Wynwood nightlife pioneer who owned the popular Wood Tavern is being sued over $1.5 million in allegedly unpaid rent for four food and beverage establishments.

The landlord, a joint venture led by New York-based Centurion Realty, recently filed three eviction lawsuits in Miami-Dade Circuit Court against Cesar Morales and two of his companies.

Centurion, headed by Ralph Tawil, and its partners paid $12 million for the sites in 2015.

Morales said he’s reached a tentative agreement to resolve his landlord’s claims, and said the $1.5 million was back rent owed as a result of the pandemic. “They sued as a back-up plan,” he said.

Tripp Vitto, an attorney representing the joint venture, declined to comment.

Wood Tavern was one of the first bars to open in the trendy Miami neighborhood almost a decade ago.

In March, Morales closed the bar at 2531 Northwest Second Avenue and an adjoining pizzeria and burger restaurant at 2507 Northwest Second Avenue. Wood Tavern opened in 2012 and attracted long lines of patrons waiting to get inside on a regular basis.

Morales said he will be vacating the other venues, Miami Mojito Co. at 2509 Northwest Second Avenue and The Tiki Garden 2519 Northwest Second Avenue, as part of the tentative agreement.

According to the lawsuits, Morales paid nearly $98,000 a month in rent for the four commercial spaces. As of Oct. 1, Wood Tavern allegedly owes roughly $243,000 in rent, the pizzeria and burger joint allegedly owes about $478,500 in rent and Miami Mojito Co. and The Tiki Garden allegedly owe close to $760,000 in rent, the complaints state.

Morales decided to close Wood Tavern and his other spots due to lost business and revenue during the months that government officials imposed Covid-19 business restrictions that limited occupancy, as well as other measures to mitigate the spread of the coronavirus, according to published reports.

Over the summer, Morales opened a second iteration of Wood Tavern inside his latest venture, Pizza & Beer at 144 Northwest 23rd Street. Morales also owns and operates Tayrona Restaurant + Patio and Las Rosas bar in Allapattah.

The post Wynwood nightlife pioneer sued over $1.5M in allegedly unpaid rent appeared first on The Real Deal South Florida.

503 South Krome Avenue in Homestead and Armando Bravo (Google Maps)

Many Miami developers covet waterfront sites and locations in bustling neighborhoods like downtown and Wynwood, but Armando Bravo is among those investing in south Miami-Dade.

Bravo, through his Bravo and Partners 11 Acres LLC, bought an Opportunity Zone development site at 503 South Krome Avenue in Homestead for $5.4 million, he said. The 11 acres is from U.S. 1 west to South Krome Avenue and between Southeast Fourth and Sixth streets.

Seller Homfarmland, managed by Coral Gables-based attorney Michael Cease, bought the property out of foreclosure in 2015, records show.

Lazaro Vilarchao of Realty Quest Group represented the seller. Bravo’s wife, Neyda Bravo of Bravo & Partners Realty, represented him in the purchase.

Bravo plans to build a roughly 190-unit apartment complex with several four-story buildings, and 60,000 to 70,000 square feet of retail facing U.S. 1, he said. He has not yet submitted an application to the city.

Miami already is built out, pushing development south to “growing” Homestead, Bravo said, which he called the future of the real estate market.

Exactly how the OZ designation will come into play is to be decided. The federal program allows investors to defer capital gain taxes in exchange for putting these gains in a real estate or business project in economically struggling areas. Investments are channeled through OZ funds.

The land was previously a mobile home park destroyed by Hurricane Andrew in 1992, according to Bravo.

He expects to complete the project in 2023.

Bravo is not the only one to opt to build in Homestead, where major homebuilders such as Lennar have developed thousands of homes.

Five development groups responded in August to a city solicitation to transform a 16-acre site, which includes the former city hall, into a mixed-use project.

In another OZ venture, a Miami-based OZ fund led by Jose Mallea wants to build a Bitcoin mining facility and technology business park near the Homestead-Miami Speedway.

The post Developer buys OZ land in bet on Homestead as “future” of real estate appeared first on The Real Deal South Florida.

3911 Island Estates Drive in Aventura, FL and Joshua Coba, co-founder of European Wax Center (The Carroll Group, Getty)

Luxury car dealership honcho Adam Gordon bought a mansion in Aventura’s exclusive Island Estates for $6.5 million, The Real Deal has learned.

Gordon, CEO and owner of Fort Lauderdale Collection, bought the five-bedroom house at 3911 Island Estates Drive.

The seller was Joshua Coba, co-founder of European Wax Center hair removal salon chain.

Coba bought the mansion in 2013 for $2.8 million. Chad Carroll of The Carroll Group at Compass closed the new sale.

The 4,803-square-foot home has five bedrooms and six and a half bathrooms. Designed by Ramon Pacheco, it has arched glass windows and doors, a powder room and a master bath with a $20,000 cast iron soaking tub overlooking the bay.

The exterior boasts a pool, fire pit and summer kitchen with two grills and a bar. The house was built in 2004, property records show.

Coba founded the European Wax Center in 2004 with his brother, David Coba, in Aventura. Now headquartered in Plano, Texas, the publicly traded salon chain has locations throughout the U.S.

Gordon’s Collection dealership was founded by his grandfather in the 1980s, with Gordon adding to the luxury and sports car business model by offering collectible cars. Inventory includes Bentleys and Lamborghinis, according to the company website.

The Collection’s customers have included professional athletes, including the NBA’s Shaquille O’Neal, according to media reports.

Gordon’s new home is on Island Estates’ southern island, an enclave of 22 mansions overlooking Dumfoundling Bay. The northern island is home to the luxury Privé at Island Estates condominium.

In 2020, DJ Khaled sold the house across the street from the one Gordon purchased for $4.8 million, 40 percent off the nearly $8 million asking price.

Residential real estate on the South Florida waterfront has seen an influx of top-dollar deals, partly from Northeasterners searching for more living space during the pandemic. In October, former French vaccine executive Olivier Brandicourt and his wife, Diane, paid $7.5 million for a Key Biscayne mansion.

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