Fractured Condo Deals Still Doable
Just because the South Florida condo market has sprung back from the dead doesn’t mean there are no bulk condo deals yet to be done, Franklin Street Services’ David Reinke tells us. There’s still an inventory from failed condo conversions of the last cycle. (They're lonely and waiting for someone to take them home, or rather, make them home.)
Most of the condo inventory from the last construction boom has been absorbed, bulk condo sales will continue through 2014, tied to inventory from failed conversions of older product, David says (snapped with colleagues Elliot Shainberg and Deme Mekras to his left). Buyers of these bulk units have various plans, ranging from collapsing the HOA and reverting to a pure rental property, to focusing again on condo sales. Recently Franklin Street brokered the sale of 102 multifamily units for a total of more than $8M, located in three different properties in Miami, Hialeah, and Hollywood Beach. All of the buyers were foreign investors. (That's more fun because the money is different colors.)
Compared to straight multifamily deals, there are far fewer options for financing, David adds. Franklin Street just listed a good example of a bulk opportunity, 100-plus condo units in Broward County, which he says “the ultimate buyer of which will most certainly be selling the units individually.” Pictured: the Jaclyn Apartments in Hialeah, where some of the previously mentioned 102 units are. Franklin Street repped the seller, Jaclyn LRP. The buyer was a Panamanian investor who paid $6M. .