Miami Developer To Pay $25,000 To Contract Holders Who Defaulted On Units

Developer Jorge Perez’s The Related Group plans to pay more than 100 former contract holders who defaulted on their 20 percent deposits at the 50 Biscayne condominium tower in Downtown Miami about $25,000 each to walk away from any future claim, according to CBS 4 in Miami.

The $25,000 payment is far less than the original deposits – some in excess of $100,000 - that were placed by preconstruction buyers who needed just a week to gobble up the 528 units in the 54-story building that opened early this year, according to the article.

The Related Group decided to pay the $25,000 even though a local judge dismissed a lawsuit this week that was brought in February on behalf of preconstruction buyers who did not want to close on their contracts at the 50 Biscayne condominium.

“Tthis is the second major lawsuit in South Florida which side with a developer,” according to CBS 4. “In August, Tibor Hollo won a landmark case where the buyers wanted their deposits back claiming the condos at Opera Tower weren't directly on the water as the advertising brochures had suggested.

“The judge in the case sided with Tibor Hollo, saying that what mattered was in the contract and not in the ads.”

The Greater Downtown Miami is considered by most to be the epicenter of the Florida housing crash as 74 condos with nearly 23,000 new units have been built or are under construction in a 60-block stretch between 2003 and 2010. In the 40 years prior to the boom years, developer constructed a total of 11,500 units in the same area, according to the Condo Vultures® Official Condo Buyers Guide To Miami.

Peter Zalewski is a principal with the consulting company Condo Vultures® LLC and a licensed real estate broker with Condo Vultures® Realty LLC. Peter can be reached at 305-865-5629 or by email at peter@condovultures.com. Be sure to check out Peter’s blog at CondoDump.com. Don't forget to sign up for our weekly Market Intelligence Report. Looking for a property at a deep discount? You are encouraged to take a peek at the Vultures Database™ .

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