• 1-800-397-7017
  • hb1237law@az-emarketing.com

Category ArchiveUncategorized

Here’s the little secret to winning a bidding war that could totally backfire

Escalation clauses are a double-edged sword

From TRD NYC: Going up?

In a hot real estate market, buyers will often put in offers with an escalation clause – something akin to an auto bid in the event a bidding war breaks out. But there are drawbacks for those on both sides of the negotiating table, according to the Wall Street Journal.

An escalation clause is an addendum to a contract that automatically raises a buyer’s offer by predetermined increments up to a maximum amount.

But they come with risks. Namely, if a buyer says they’re willing to increase their bid up to a maximum amount, they’re tipping their hand to the seller as to how much they’re actually willing to pay.

“A buyer can think of an escalation clause as a ‘have your cake and eat it, too’ clause,” said David Reiss, a professor at Brooklyn Law School who specializes in real estate. “But in real estate, as with cake, it is hard to have it all.”

The seller can make a counter offer at the buyer’s maximum escalation clause price, but there are drawbacks for the seller too.

Say an owner lists a house for $1 million, and a buyer puts in an offer of $950,000 with an escalation clause that rises in increments of $5,000 to a maximum of $1 million. A second buyer comes along with an offer of $980,000, the escalation clause kicks in and the first buyer wins the property at $985,000.

If the seller hadn’t agreed to the escalation clause and simply asked for the best and highest offer, it’s possible the first buyer would have made their maximum bid of $1 million. The seller potentially left $15,000 on the table.

But while these kinds of clauses become more common in hot markets, they’re seen less often in high-end real estate, where the increments would have to be substantially higher. [WSJ] – Rich Bockmann

 

 


Source: http://feeds.feedburner.com/trdmiami

Contractor sues supplier of a crane that collapsed during Hurricane Irma

Collapsed crane at the construction site of X Miami in downtown Miami after Hurricane Irma (Credit: Joe Cavaretta/Sun-Sentinel)

A contractor constructing a high-rise apartment building in downtown Miami sued the supplier of a crane that collapsed during Hurricane Irma.

Miami-based L&R Structural Corp. sued Maxim Crane Works LP after its crane collapsed at the construction site of X Miami, an apartment development formerly known as Vice.

In the lawsuit filed in Miami-Dade Circuit Court, L&R charged Maxim with breach of express warranty, breach of lease and product liability. L&R, which had leased the crane for $23,000 a month, also accused Maxim of negligence for providing a deficient plan to prepare the construction site for a hurricane.

L&R claimed that Maxim was responsible under their lease agreement for disassembling and relocating the damaged crane after Hurricane Irma hit Miami on Sept. 10.

Maxim refused to do so and instead sent an engineer to monitor L&R’s removal of the broken crane at the L&R’s expense, according to the lawsuit.

In a Sept. 19 letter to the contractor, Maxim told L&R that it was responsible for costs stemming from the crane accident under the terms of their lease agreement.

Holland & Knight attorneys Michael Candes, James McCrae and Andrew Albaugh filed the lawsuit on behalf of L&R.

Construction of X Miami, a 31-story building with 464 apartments, is scheduled to conclude in fall. The building’s developer is Property Markets Group. [Daily Business Review] – Mike Seemuth


Source: http://feeds.feedburner.com/trdmiami

Lennar breaks ground for BellaSera in Royal Palm Beach

BellaSera clubhouse rendering

Lennar broke ground for construction of 385 houses on the former site of a municipal water treatment plant in Royal Palm Beach, which the village demolished in 2009.

In 2015, Miami-based Lennar paid the village $35 million for the 154-acre development site, just west of H.L. Johnson Elementary School off Crestwood Boulevard.

Lennar’s gated residential development, called BellaSera, will have house prices starting in the low $400,000s.

The one- and two-story houses will have three to five bedrooms and two to five and a half bathrooms and garages for two or three cars.

Through Lennar’s partnership with online retailer Amazon, BellaSera houses will come equipped with Amazon’s voice-activated digital assistant Alexa.

In addition, “this will be our first completely Wi-Fi certified community,” which eliminates Wi-Fi dead spots in houses, Dan Grosswald, president of Lennar’s Palm Atlantic Division, told the Palm Beach Post.

BellaSera also will feature a clubhouse with a gym, swimming pool and playground, plus basketball and tennis courts. [Palm Beach Post] – Mike Seemuth


Source: http://feeds.feedburner.com/trdmiami

Jupiter Medical Center seeks to nearly quadruple the size of its cancer center

Jupiter Medical Center (Credit: Richard Graulich/Palm Beach Post)

The Jupiter Town Council on Tuesday will consider a proposal by the Jupiter Medical Center to nearly quadruple the size of its cancer treatment center.

Jupiter Medical Center has received a $25 million donation for its cancer treatment center from an unidentified donor.

The 207-bed nonprofit hospital wants to expand its 20,000-square-foot cancer treatment center by 54,300 square feet.

Now known as the Foshay Cancer Treatment Center, the expanded facility would be renamed the Anderson Family Cancer Institute.

Davis & Stokes Collaborative designed the three-story building that would house the expanded cancer treatment center.

The new building would rise on a surface parking lot with 32 spaces. Jupiter Medical Center just bought 6.1 acres north of its campus at 1240 Old Dixie Highway for another parking lot and additional facility development.

Steven Seely, vice president and chief operating officer of Jupiter Medical Center, told the South Florida Business Journal that construction of the expanded cancer treatment center could start in May and conclude by September 2019. [South Florida Business Journal] – Mike Seemuth


Source: http://feeds.feedburner.com/trdmiami

Winn-Dixie may be headed back to bankruptcy

Winn-Dixie store at 3805 NE 163 Street in North Miami Beach (Credit: Yelp.com)

The corporate parent of supermarket chain Winn-Dixie may file for bankruptcy as soon as March.

Bloomberg also reported that the Winn-Dixie’s corporate parent Bi-Lo LLC plans to close nearly 200 of the supermarket chain’s locations either before or after filing for bankruptcy.

In previous corporate incarnations, the Winn-Dixie business declared bankruptcy in 2009 and 2005, and Bi-Lo still may engineer a debt restructuring that would preclude a third bankruptcy filing, Bloomberg reported.

Bi-Lo is struggling to repay more than $1 billion of debt in connection with its 2005 acquisition of Lone Star Funds. Bi-Lo and its creditors have discussed a potential swap of debt for equity and asset sales.

The supermarket business has become more competitive as Wal-Mart and other big-box retailers vie for grocery sales along with online retailer Amazon, which bought the Whole Foods supermarket chain last year.

A representative of Southeastern Grocers, the Jacksonville-based parent company of Bi-Lo, did not respond to Bloomberg’s request for comment.

Southeastern Grocers also operates the Fresco Y Mas and Harvey’s supermarket chains. [Bloomberg] – Mike Seemuth


Source: http://feeds.feedburner.com/trdmiami

Feds set to seize 5 South Florida properties allegedly acquired with fraudulent funding

8368 Serena Creek Avenue in Boynton Beach (Credit: Realtor-com)

Federal prosecutors will seize five properties in South Florida they claim were acquired with fraudulently obtained funds.

Prosecutors filed liens to seize the properties in connection with an indictment of Daniel Joseph Touizer, founder and chief executive officer of Fort Lauderdale-based Wheat Capital Management. Three of the properties are self-storage facility development sites, and two are residences.

Daniel Joseph Touizer

The U.S. Attorney for the Southern District of Florida indicted Touizer in September on charges of mail fraud, wire fraud and conspiracy to commit fraud.

An amendment to the indictment on Nov. 21 charged co-defendants Saul Daniel Suster and John Kevin Reech with mail fraud.

The defendants allegedly used false statements to defraud more than 150 investors who thought they were putting money into businesses controlled by Touizer, an Aventura resident.

According to the fraud indictment, Touizer used most of the $19 million he raised from investors to pay his personal expenses or sales commissions to agents in a call center.

Attorneys for the defendants either declined to comment or were unresponsive to a request for comment.

The five properties subject to seizure include a 3,024-square-foot house at 8368 Serena Creek Avenue in Boynton Beach and a 3,200-square-foot residence in Courtyard at the Point, 21213 Northeast 38th Avenue in Aventura.

Also subject to seizure is a 50,625-square-foot site at 2915 Northwest 36th Street in Miami, which is approved for construction of a self-storage facility.

Construction of self-storage facilities is already under way at the other two properties subject to seizure: a 42,991-square-foot site at 2801 John P. Lyons Lane in Pembroke Pines and 2.6-acre site in Margate on Northwest 31st Street just west of State Road 7. [South Florida Business Journal] – Mike Seemuth


Source: http://feeds.feedburner.com/trdmiami

Billy Joel buys a horse ranch in Wellington for $3.5M

Billy Joel

Recording artist Billy Joel bought a horse ranch in Wellington for $3.5 million.

Joel, 68, bought the five-acre ranch for his fourth wife, 36-year-old Alexis Roderick, an experienced equestrian.

The ranch has a barn with 12 stalls and a groom quarters and a dressage ring.

The buyer of the property was a corporation called Littlesea Farm South, which was created two weeks before the closing.

The Daily Mail reported that Joel is the buyer behind Littlesea Farm and that another company linked to the singer and songwriter acquired property adjacent to the five-acre ranch in 2016 for $3.628 million.

The two Wellington properties span 10 acres.

Joel still is trying to sell an oceanfront mansion in Manalapan and a vacant lot next door that he bought in 2014 for $18.3 million. The lot and the nine-bedroom, nine-bathroom mansion are now listed for sale with an asking price of $16.9 million. [Daily Mail] – Mike Seemuth


Source: http://feeds.feedburner.com/trdmiami

Jury hits environmentalist with $4.3M judgment in Martin County mining dispute

Maggy Hurchalla (Credit: GossipExtra.com)

A trial jury levied a $4.3 million judgment against environmentalist Maggy Hurchalla after finding that she interfered in a deal between Martin County and a mining company.

Hurchalla, sister of late U.S. Attorney General Janet Reno and a former member of the Martin County Commission, told the Palm Beach Post she will appeal the verdict.

The legal fight pitted Hurchalla against mining company Lake Point Restoration. Lake Point’s principals include billionaire George Lindemann Jr., son of billionaire George Lindemann.

Lake Point paid $47.7 million in 2008 for approximately 2,200 acres near Lake Okeechobee in western Martin County for a polo-themed community development.

After dropping the idea for a polo community amid a crash in the housing market, Lake Point decided to conduct mining operations on the land for a 20-year period, then donate mined land to the South Florida Water Management District. The water management district agreed to a plan to use holes in the mined land to store and treat water that overflows Lake Okeechobee.

Lake Point and the water management district urged Martin County to allow mining on the land by promising to divert lake overflows from the St. Lucie Estuary and to provide the county with a new public park.

Lake Point accused Hurchalla of interfering with its relationship with Martin County by falsely claiming in emails to county commissioners that destruction of wetlands warranted termination of the company’s agreement with the water district.

The emails triggered a lawsuit by Lake Point against Martin County alleging that the several county commissioners violated public records laws.

The county settled that lawsuit last year by agreeing to pay $12 million for a 400-acre tract of land it doesn’t want and to apologize in writing to Lindemann and other principals of Lake Point.

Two members of the Martin County Commission and a former member now face individual charges related to violations of public records laws arising from the county’s dealings with Lake Point.

Hurchalla has stuck to her claim that the emails to county commissioners were a legal exercise of free speech.

Lake Point also sued the water management district, which settled the suit last year by agreeing to purchase 50,000 tons of rubble annually for 15 years from Lake Point’s mining operation in western Martin County, and after 50 years, the district would be able to use the mined land for water storage and treatment.

According to Ethan Loeb, an attorney for Lake Point, the settlement with the water district is worth $6 million and, together with the county’s $12 million settlement, will cover $18 million of $22 million in damages the company has claimed. That was the basis of the $4.3 million judgment against Hurchalla. [Palm Beach Post]Mike Seemuth

= = =


Source: http://feeds.feedburner.com/trdmiami

TV producer buys Maui home for $23M, highest-priced sale in Hawaii so far this year

A five-bedroom, seven-bath new beachfront home in Kihei has sold for $22.8 million, the highest-priced residential transaction in Hawaii so far this year, and the fourth-highest sale ever on Maui.

The buyer of the 7,331-square-foot home, which is on three-quarters of an acre, is an entity owned by television producer Byron Allen.

The seller was MGN Hawaii Land Investments, an entity owned by Joe Kenny, chief financial officer of commercial real estate investment, development and management firm…

Source: http://feeds.bizjournals.com/industry_21

National Cheat Sheet: CBRE tops Eastdil for most commercial deals, startup to mint the first RE-backed cryptocurrency … & more

Clockwise from top left: Kathy Korte and Brendan Fairbanks of Perchwell, Chicago’s signature tower is no longer the John Hancock Center, CBRE President & Chief Executive Officer Bob Sulentic, and the FBI’s J. Edgar Hoover Building.

CBRE tops Eastdil for highest commercial deal total nationwide
With $53.9 billion in deals in 2017, CBRE ranked as the number one commercial brokerage in the U.S. beating perennial frontrunner Eastdil Secured, which handled $40.7 billion in trades, according to Real Estate Alert, which tabulated the rankings. Commercial sales dipped 10 percent last year, with most of the decline coming in larger deals, Eastdil’s specialty. [TRD]

Startup to mint the first real estate-backed cryptocurrency
California-based startup Aperture Real Estate Ventures will offer the “opportunity to own a professionally managed portfolio of real estate assets via the blockchain” when it launches the first real estate-backed cryptocurrency called the Property Coin. Investors will buy into a fund backed by the company’s portfolio of properties. Property Coin will sell at an initial price of $50. [TRD]

Well-funded Compass doesn’t shy away from competitors in agent recruitment
Five-year-old brokerage Compass ended 2017 with 888 agents in New York and has plans to recruit more backed by a $450 million cash injection courtesy of Softbank. “When we want someone, we go after them from every angle possible,” Nolan Greenberg, who leads a nine-person recruitment team at Compass that is focused on employee hiring. Rob Lehman, Compass’ chief revenue officer, oversees agent recruitment. In New York alone, Compass has signed up 73 agents from the Corcoran Group, 42 from Douglas Elliman and 34 from Halstead Property. [TRD]

Listing systems start-up Perchwell scores another brokerage as a client
Startup Perchwell claimed another win in the battle over back-end listing systems, as Sotheby’s International Realty will switch to its service from competitor RealPlus. CORE, Warburg Realty, Stribling & Associates, Berkshire Hathaway, Fox Residential and Sloane Square have all signed with Perchwell in recent months. The startup says it has raised $4 million in funding and plans to grow from 12 employees to 40. [TRD]

Blackstone Mortgage Trust grows portfolio to record $11B
Blackstone Group’s mortgage real estate investment trust issued $4.8 billion in new loans in 2017, growing its total value by 16 percent to a record $11.1 billion. Blackstone Mortgage Trust, a public REIT, grew in the face of increased competition from non-bank commercial real estate lenders, and CEO Stephen Plavin said the new federal tax law should have a positive impact on business. [TRD]

Fannie Mae hopes to shed more than $1 billion of delinquent loans
As it eliminates non-performing loans, Fannie Mae is planning to sell off five pools of delinquent loans, according to HousingWire. Three larger pools include some 5,900 loans worth an estimated $1 billion. Two Community Impact Pools, centered in Tampa and Orlando, include about 190 loans worth roughly $36 million. [TRD]

MAJOR MARKET HIGHLIGHTS

HNA sells NYC mansion for a record-setting $90M to billionaire Blavatnik
As Chinese-giant HNA Holdings Group sells off its international real estate, an affiliate company has sold an 18,860-square-foot mansion at 19 East 64th Street for $90 million. The New York Post reported that the buyer is Ukrainian-born billionaire Len Blavatnik. The Chinese group planned to use the building as offices after buying it from art heir David Wildenstein in April 2017 for $79.5 million. [TRD]

FBI changes course and opts to stay in DC with a new $3.3B HQ
The Federal Bureau of Investigation reversed itself on a nearly decade-long demand to move its headquarters out of the J. Edgar Hoover Building in downtown Washington, D.C., for greener pastures in the suburbs. Instead the FBI is now proposing building a new facility on the same plot on Pennsylvania Avenue and shipping some 2,300 employees to other facilities around the country. If Congress approves the Trump administration’s infrastructure plan, the FBI will have a total of $3.3 billion to replace the Hoover Building, which opened in 1974 and no longer meets many security requirements. [Washington Post]

If Amazon is interested in Miami, this developer just happens to have 10 acres ready
The 27-acre Miami World Center is still under construction, but its main developer, Nitin Motwani, has 10 acres set aside for Amazon, if the internet giant chooses to build its second headquarters in Miami. Amazon has narrowed the list of potential locations for the $5 billion project to 20 cities, and Miami is among them. The Miami World Center is only one of eight locations that were included in Miami’s pitch to Amazon. The city’s battles with rising sea levels, mounting traffic issues and limited public transportation are considered drawbacks in securing HQ2. [TRD]

One of Chicago’s signature towers loses its John Hancock
Chicago’s fourth tallest building will no longer be known as the John Hancock Center, as the insurance company that built the 100-story tower in the 1960s asked that its name and logos be removed from the structure. Hearn Co., which owns the tower, will refer to it as 875 North Michigan Avenue, the building’s address, until a new deal can be struck for naming-rights, CEO Stephen Hearn told the Chicago Tribune. John Hancock hasn’t been a tenant in the building for many years. [Chicago Tribune]

From ski slopes to Beverly Hills: Gestalt Group to lead Engel & Volkers office
Paul Benson and Dougan Jones, owners of the Gestalt Group, are moving from the company’s Engel & Volkers’ Park City, Utah, office to take over the firm’s Beverly Hills outpost. The pair will lead an office of 40 in the Beverly Hills location, along with partners Raphael Barragan and Dennis Duban. Benson is CEO of Engel & Volkers USA Real Estate, a division of German-based Engel & Volkers. [TRD]

UC San Francisco plans new $1.5B hospital backed by $500M donation
UC San Francisco will build a new hospital at its Parnassus Heights campus backed by a $500 million donation from the Helen Diller Foundation. The $1.5 billion project will replace the Langley Porter Psychiatric Hospital and is expected to open before 2030. Moffitt Hospital, the current patient care facility built in the 1950s, does not meet seismic code requirements and can’t be used after 2030. The late Helen Diller and her husband Sanford, founder of the Prometheus Real Estate Group, have given more than $1.15 billion to UC San Francisco. [Mercury News]


Source: http://feeds.feedburner.com/trdmiami

Skip to toolbar