A 36-year-old condo complex in Broward County is heading to auction nearly a year after the city of Pembroke Pines deemed it structurally unsafe for residents.
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A court-appointed receiver scheduled a public auction of the Heron Pond Condominium Association for Sept. 25. Avison Young and Fisher Auction Co. are handling the marketing and sale process for the 304-unit, 19-building complex, which could fetch roughly $25M.
“It’s a receiver sale, so the opportunity is to really get a deal done in today’s market with a high sense of urgency,” Avison Young principal John Crotty, part of the court-appointed team handling the sale, told Bisnow.
Heron Pond was originally built as a garden apartment complex in 1988 but was converted to for-sale condos in the early 2000s. But years of unaddressed maintenance started piling up.
Residents complained of large holes from termite damage, rotted wood beams and balconies being held up by plywood and metal jacks, design flaws and inadequate construction that couldn't withstand high winds, WSVN reported.
The city began issuing safety notices in 2023. By July, all occupied units were declared unsafe, and residents were forced to fully evacuate by Aug. 19.
Crotty said the 25-acre site has the potential to sell for roughly $1M per acre. The team aims to finalize a stalking horse bidder by late July and launch public marketing in early August in time for the live auction in September.
With the zoning potential for 321 units, it is an attractive project for multifamily residential developers looking into getting in on a tight market, Crotty said.
“The few developments that are in the area are really older developments, and they have a high occupancy level,” he said. “That's what a multifamily developer is looking for: a market that's pretty tight and to be able to put in a new product that would garner interest and potentially push rents.”
Heron Pond at 8400 SW First St. was originally approved to be sold in August, just after residents were ordered to evacuate. A month later, two condo owners sued to stop the receiver, Daniel Stermer, from pursuing a full sale of the property, The Real Deal reported at the time.
The auction took nearly a year to move forward because the team prioritized completing a full condo termination of the entire complex. That process is nearly finalized, Crotty said, so the court approved scheduling the auction date three months out.
“By having this, all the rights being folded in, it's a much cleaner sale,” he said. “It's much more appealing to a buyer to get that type of sale done, where it's one simple, clean-title sale and you move forward without having to worry about one condo owner of the existing 314 units having a problem.”
Condo terminations and buyouts haven't been as common as many predicted in the wake of the deadly Surfside collapse in 2021 and the safety legislation it spurred. The laws thrust the condo market into a doom loop with mounting financial pressures driven by recertification mandates and reserve funding requirements.
But despite many predictions that associations will be forced to terminate and clear a path for the demolition of their buildings, the market has been slow because of unclear legal standards and owner holdouts. Many hoped this year's update of the condo safety law — House Bill 913, which Gov. Ron DeSantis signed on Monday — would clarify the termination process, but it was passed without addressing those concerns.
While recertifications aren't yet driving condo owners to terminate their associations, sometimes their hands are forced.
In January, a 77-year-old waterfront condo complex in Fort Lauderdale went up for sale just three months after residents were evacuated due to structural concerns. Instead of paying a $4.5M repair bill, the owners decided to move out and sell.
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