South Florida Foreclosures Gain Investor Attention

According to the South Florida Business Journal, the Promenade at Doral II, a planned community of 771 villas in Doral, has been scheduled for a foreclosure auction. The project is owned by EB Developers of Boca Raton, and the Journal reports that this is only one of the six foreclosure suits to hit EB’s projects within the last 18 months.

A property foreclosure in Broward County’s showcase area of Las Olas also made a big splash today. The long suffering Las Olas Riverfront complex was sold at auction for a bid of $100. While that seems like an astounding coup to those who follow real estate investment in South Florida, the winning bid came from the company that controls the mortgage for the complex.

That company is Madeleine LLC, which is part of Cerberus Capital Management, the company that had hoped to rebuild Chrysler and GM before their recent, respective demises. The Las Olas complex was built for $58 million back in 1998 and sold to Boca Developers for $32 million in 2005. Madeline LLC bought the loan in 2008, and is currently owed around $24 million. This property has a location right on the New River. After the recession is over, this property is likely to be a redevelopment dream come true.

But there’s much more for real estate investors to start salivating over in Palm Beach and Broward real estate market. Because there are more than 50 industrial, retail and office complexes worth close to $800 million that fit into the category banks like to call “troubled assets.”

That’s a polite term for ready to foreclose. Among these potential foreclosures are the Pembroke Lakes Mall and the Downtown at the Gardens mall in Palm Beach Gardens. This mall was relinquished by its owner using a deed in lieu of foreclosure, otherwise known as “friendly foreclosure.”

While these foreclosure properties and others like them may seem like a blight upon the fragile state of Florida real estate, billionaire investor Wilbur Ross sounded almost upbeat. According to Reuters, while Ross called commercial real estate “the next time bomb,” he also indicated that he’d be there to invest in these distressed properties.

Woolbright Development, a Boca Raton based real estate investor, stated that it might make up to $100 million in real estate investments within the next 4-6 months. According to the Miami Herald, Steelbridge Capital of South Florida is expecting to invest heavily in these commercial real estate foreclosures because it is flush with cash and does not have any troubled assets. But Steelbridge, and other investors in a similar position, are very willing to relieve banks of these foreclosures if they can pick up the property at a bargain rate.

It appears that real estate investment in Palm Beach and Broward counties is far from moribund. While commercial property foreclosures are making headlines, savvy real estate investment pros are quietly moving into position to take up the slack in the market.

Written by Marc Jablon, Realty Associates
Email: marcjablon@yahoo.com. Tel: 561 / 213 – 6139
www.MarcJablonHomes.com