Three Brickell Condominiums Have Highest Foreclosure Rate
Written by Marilyn Bowden on November 1, 2007
By Marilyn Bowden
Recent reports show South Florida is second in the nation in foreclosures, with Brickell condos racking up the highest numbers locally.
According to a new report from Condo Vultures, a consultancy representing buyers, the three condominium towers with the highest number of foreclosure proceedings filed in a Miami-Dade building through the first three quarters of 2007 are located along Brickell.
With 54 foreclosures, The Club at Brickell Bay, 1200 Brickell Bay Drive, leads to pack. Condo Vultures Principal Peter Zalewski said that’s the highest tally for any building in Miami-Dade and Broward counties.
The Vue at Brickell, a conversion project at 1250 S Miami Ave., follows with 49 foreclosure actions. In third place is The Jade at Brickell Bay, 1331 Brickell Bay Drive.
"These three Brickell towers account for 37% of the entire number of foreclosure actions filed in the top 10 buildings in South Florida," Condo Vultures reports. "On a dollar basis, they account for more than $113 million in loans and fees owed to the lenders and condo associations that are pursuing foreclosure."
Since closings were already completed at all of these properties, Mr. Zalewski said, the actions against unit owners would be more likely to represent nonpayment of mortgage payments than failure to close.
"With at least another 12,000 units scheduled to be delivered in the area within the next six months," he said, "I would expect Brickell Avenue and the nearby Downtown Miami area to be a focal point for discount buyers in the future."
Martin A. Schwartz, a partner at Bilzin Sumberg, said foreclosed units are put on the block for public sale.
"Typically what happens is the foreclosing party buys it in the amount of their loan on the sale," he said, "although it is possible for somebody else to buy it if they bid more than that amount."
The waterfront strip from Miami Beach north to Sunny Isles Beach and west to Aventura is home to three more buildings — all condo conversions projects — that the Condo Vultures report ranks on its top 10 list of South Florida foreclosures.
Oceanview, 19390 Collins Ave. in Sunny Isles Beach, has 41 units in some stage of foreclosure; Aventura’s Parc Central Aventura, on Northeast 192nd Street, has 34, and Miami Beach’s Mirador, 1000 West Ave., has 27. Together, Mr. Zalewski said, these three represent $34 million owed to creditors.
In all, Condo Vultures reported 8,533 Miami-Dade properties worth $2.37 billion in some phase of foreclosure over the year to date.
Multiple foreclosure actions in the same property put a strain on the condo association that gets passed along to unit owners in the form of higher assessments, Mr. Schwartz said. "Condo law provides that the foreclosing lender is not obligated for greater than six months’ worth of assessments or 1% of the loan, whichever is less," he said. "So they would not be obligated for more than a certain amount. The other condo owners are then reassessed for the shortfall. That puts a strain on owners who may already be having problems meeting the maintenance fees."
With one filing for every 248 households, Florida was second only to Nevada in foreclosure actions during the month of September, according to a report from RealtyTrac Inc. The rate across all states was one filing for every 557 households.
In the state of Florida, 33,354 foreclosure filings were reported in September —— "down just less than 2% from August, but more than three times greater than September 2006’s total," RealtyTrac’s researchers said. Nationally, the real estate information company reported, foreclosures doubled from September 2006 to September 2007.
Following Nevada and Florida on RealtyTrac’s top 10 foreclosure list were Michigan, Arizona, Georgia, Ohio, Colorado, Texas and Indiana.