Zombie Condos

This ruling has made a lot of big $$ developers pucker up. Knowing our state supreme court, I suspect it will get overturned but interesting subject..

I have never done redevelopment like this and didn't even know that they could disband a condo and effectively force residents to sell even if they didn't want to sell

‘Zombie’ Condos, Angry Residents and a Ruling That Stunned Miami’s Developers (msn.com)

Avila’s plight stems from a longstanding practice threatened by an appeals court ruling earlier this year. The practice, in which developers can force condo owners to sell homes they never intended to leave, was challenged in March. The appeals court stunned the Miami real estate community by siding with the small group of residents who refused to sell at Biscayne 21. The court overturned a ruling from a circuit judge that had been in favor of Two Roads and its partners.

Now dozens of other Miami developers with their own condo terminations under way are wondering what the appellate court ruling will mean for their planned projects. “This will greatly impact the risk analysis a developer must undertake in pursuing an acquisition of one of these older condominiums,” said Matt Allen, a developer at Related Group, a real-estate company that has terminated multiple condominiums in Florida.

Up and down the coast of South Florida, developers have been buying out condo units in buildings for the purpose of tearing down these decades-old properties and building glimmering new luxury towers in their place. It is one of the few ways to acquire scarce land on the water. For older buildings, a bulk purchase by a developer is often a welcome solution for owners who can’t find buyers in the market.
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A few, like Avila, say they don’t want to sell regardless of price. But they have had little recourse if most of their neighbors want to sell. In some cases, as in her building, Biscayne 21, a developer acquires enough units to take control of the condo board and alter the rules so that it no longer needs the approval of every resident to complete a bulk purchase of all units.

 

this isn't the gubmnt imminent domain though. This is private companies buying enough condos to be able to control the board and force a bulk sale. didn't realize there was a mechanism to force a bulk sale.

having been part of a few imminent domain hearings to get ROW for roads, I can assure you that the gubmnt usually ends up paying much more than market value. Having your property being assigned for eminent domain is like hitting the jackpot if you don't mind selling