UPDATED, Aug. 24, 6:25 p.m.: A number of developers tried to do it before, but the Related Group and Two Roads Development are now close to completing a bulk purchase of units at the Carlton Terrace condominium in Bal Harbour, The Real Deal has learned.
The developers’ joint venture is spending roughly $130 million for all 88 units at the oceanfront building at 10245 Collins Avenue, according to sources.
Zoning for the nearly 3-acre Bal Harbour property would allow for a new residential building 275 feet tall or about 28 stories. Related and 50/50 partner Two Roads are expected to tear down Carlton Terrace and replace it with a luxury condo tower.
The purchase comes two months after the tragic Surfside condo collapse that killed nearly 100 people, about five blocks from Carlton Terrace.
Built in 1956, the 15-story Carlton Terrace is in need of repairs. Restoration and repair projects, which bring older buildings up to code, are expensive, lengthy, and often result in special assessments for unit owners.
Experts speculate there will be a jump in bulk buyouts of older properties, especially in situations where unit owners can no longer afford to make the necessary repairs.
Developers, with little to no inventory of available oceanfront land, are taking advantage.
Miami-based Related, led by condo king Jorge Pérez and his son, president Jon Paul Pérez, formed an entity in April to acquire the Carlton Terrace units, according to state corporate records. Two Roads is led by managing partners Reid Boren and Taylor Collins. Its projects in South Florida have included Elysee Miami and Biscayne Beach, both in Edgewater.
Related and Two Roads said in a statement that they are acquiring “sufficient units to pave the way for redevelopment.” The two firms said they plan to share details on their plans in the next few months.
Eight closings at Carlton Terrace have been recorded so far that are dated as early as July. A majority are expected to close later this week.
Those that have been recorded so far include real estate broker and investor Stuart Drossner’s sale of a unit for about $1.5 million. He paid just $407,000 for the condo last year. Drossner said “the number was right,” and that he convinced a number of unit owners to sell.
Daniel Benhayoun, an attorney, sold his unit for $2.4 million. He paid $1 million for the condo in early 2020, according to property records.
A Berkadia team led by Jarett Turkell and Scott Wadler are involved in the deal, representing a number of sellers.
Last year, Two Roads, Continuum South Beach developer Bruce Eichner, and One Thousand Museum developer Louis Birdman were all interested in buying out the unit owners. And prior to that, other developers had tried to do the same, including Vlad Doronin’s OKO Group.
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Related entered the picture between December and January, according to sources. Related and Two Roads later partnered, as the majority of sale contracts were contingent on the two firms coming to an agreement.
The property is north of Oceana Bal Harbour, a 28-story condo tower that was previously the site of the Bal Harbour Beach Club. Oceana Bal Harbour, completed in late 2016, is the newest luxury condo building to be completed in the Bal Harbour.
Other developers have been successful at bulk buyouts recently. Starting in May, Mast Capital paid more than $100 million on the majority of units at an oceanfront mid-Miami Beach building.