David Martin’s Terra is seeking to unload land underneath a Coconut Grove site complicated by a ground lease with Location Ventures, the defunct development firm founded by Rishi Kapoor.
Coconut Grove-based Terra recently listed the 0.4-acre property at 3120-3138 Commodore Plaza with an asking price of $18.9 million, according to an offering memorandum. Tony Arellano and Devlin Marinoff with Dwntwn Realty Advisors are marketing the property.
“It could be seen as complicated, but it’s really an interesting opportunity for an irreplaceable property,” Arellano told The Real Deal. “The site went to market about a week ago and we have been flooded with inquiries, ranging from family offices to developers.”
A Terra spokesperson did not immediately respond to a request for comment.
The property includes an unfinished mixed-use project that is under a demolition order by the city of Miami, court records show. The building’s concrete shell is owned by a Location Ventures entity that has allegedly defaulted on the ground lease, and is also facing foreclosure by two trusts managed by Martin Halpern in Miami. The trusts allege the Location Ventures entity owes an unpaid mortgage debt of $27.4 million.
Bernice Lee, a court appointed receiver overseeing the dismantling of Location Ventures, including selling all of the company’s assets, struck a pending deal to sell the ground lease and the unfinished project to KOR Development, a Miami-based firm led by Andrew Korge, for $28.2 million.
In the event the deal closes, the sale proceeds would be used to pay off the Halpern trusts after closing costs of an estimated $1.3 million, plus $600,000 for the receivership, court records show. If the KOR Development deal falls apart, the Halpern trusts are the back-up buyers and will automatically receive a credit of $27.4 million toward the $28.2 million purchase price.
The Commodore Plaza property played a central role in Location Ventures’ implosion, as well as the downfall of Kapoor, once a rising star in South Florida’s development industry. A Location Ventures affiliate entered into a 99-year ground lease in 2018 when Terra and Banyan Street Capital bought the site for $7.2 million.
Through Location Ventures’ subsidiary Urbin, Kapoor planned to redevelop the property’s existing mixed-use building, which is next to the Coconut Grove Playhouse, into a co-working and co-living project.
The development was marred by permitting delays and a 2022 lawsuit in Miami-Dade Circuit Court by a minority group of project investors accusing Kapoor of obtaining the Halpern loans without approval from 70 percent of the ownership entity’s shareholders.
Within months of the pending complaint being filed, Kapoor resigned as CEO of Location Ventures after a cascade of lawsuits and scandals engulfed him and his company, including that he had hired Miami Mayor Francis Suarez as a private consultant who was paid $10,000 a month by Urbin.
In December 2023, the U.S. Securities and Exchange Commission filed a separate federal civil lawsuit against Kapoor, Location Ventures and various related entities for allegedly defrauding more than 50 investors who contributed $93 million for his failed real estate projects.
The SEC and Kapoor agreed to a settlement in November of last year that, among other stipulations, permanently prohibits him from disseminating false and misleading documents and materials to any prospective investor about securities and investment strategy.