DEVELOPERS ARE ON THE PROWL
Eric Glazer, Esq.
Published October 25, 2021
I got a call this week from The Miami Herald. They asked if I
had heard about the prominent developer who approached the
owners of the other Champlain Towers buildings that are still
standing, offering to buy out all of their units. I had not,
but Iím not surprised in the least about it. In fact, itís
going to be happening more and more. Developers are going to be
approaching lots of owners in condominiums that are distressed.
Why approach the owners in the remaining Champlain Towers
condominiums? Iím sure the developer is thinking that these
owners may now have a hard time selling their condo units on the
open market because there may not be many buyers interested in
purchasing a unit in a condominium by that name. The Champlain
Towers will forever be remembered as the building that collapsed
and where nearly a hundred innocent people died. I think the
developer is right. It will be tough to sell your units in the
remaining Champlain Towers condominiums.
The truth isÖÖif thatís the caseÖand it is next to impossible to
now sell your condo unit in these buildings, the developer can
look like a knight in shining armor, if the price they offer is
fair and reasonable. It may very well make sense for the owners
to seriously consider the developerís offer. At the remaining
Champlain Towers buildings, the developerís offer is contingent
upon 95% of the owners agreeing to sell to the developer. If
less than 95% of the owners agree to sell, the deal is off the
table. Thatís because if at least 5% of the owners vote against
a plan of ďterminationĒ the developerís plan to ďterminateĒ the
condominium, knock it down and build a more expensive one
fails. So, the developer needs to acquire at least 95% to
ensure their plan succeeds.
We know that itís about to get more expensive to live in a
condominium because it looks like it will become more difficult
to waive reserves and buildings will be undergoing more frequent
inspections. Repairs will be needed more than ever before which
means money will be needed like never before. When unit owners
donít have the money or donít want to spend the money on a
building thatís already old, rest assured that developers will
be there ready to make an offer to everyone so that the property
can be bought, knocked down, rebuilt and sold.
Over the last few years the law has made it more difficult to
terminate a condominium. As a result of the tragedy at The
Champlain Towers I certainly expect the pendulum to swing back
the other way. Terminations will become easier. Developers
will use their eyes and airs searching for the most vulnerable
properties, meaning the ones that will require the greatest cost
to repair. The laws regarding termination continue to evolve,
but if I am a developer I may want to be cautious about buying
units in a condominium that requires 100% of the owners to agree
to termination and that does not have Kaufman language or ďas
amended from time to timeĒ language. In these types of
condominiums, one owner who refuses to sell may wind up screwing
up the developerís grand plans.
HOA & Condo Blog
Eric Glazer graduated
from the University of Miami School of Law in 1992 after
receiving a B.A. from NYU. He has practiced community
association law for three decades and is the owner of
Glazer and Sachs, P.A. a five attorney law firm with
offices in Fort Lauderdale and Orlando.
Eric is Board Certified by The Florida Bar in
Condominium and Planned Development Law.
Since 2009, Eric has been the host of Condo Craze
and HOAs, a weekly one hour radio show that airs at 11:00 a.m.
each Sunday on 850 WFTL.
Eric is the first attorney in the State of
Florida that designed a course that certifies condominium and
HOA residents as eligible to serve on a Board of Directors and
has now certified more than 20,000 Floridians all across the
state. He is certified as a Circuit Court Mediator by The
Florida Supreme Court and has mediated dozens of disputes
between associations and unit owners. Eric also devotes
significant time to advancing legislation in the best interest
of Florida community association members.