I have posted that the Flippers are back. Not the squeeky, sea mammal of 1970's TV with Bud & Sandy as his best friends but the real estate flippers. Then, this story comes in from the Miami Herald. Miami and Miami Beach are ground zero for the overbuilt condo market.
It could be one of the quickest profits made in Miami's condo market. All it took was 20 minutes for a bulk buyer to make $200,000 by purchasing 19 units in the new Mi Primera Ilusion Villas Miami condominium and then immediately selling the same condos to another investor, according to a report from CondoVultures.com.
The Fama Group, with principal Nancy Marquez, purchased 19 units in the 30-unit condominium on Southwest 18th Avenue in Miami for $1.25 million, or $102 per square foot, according to Florida Secretary of State records. The deal was completed at 1:25 p.m., Friday, March 5.
Exactly 20 minutes later, at 1:45 p.m., Marquez's group sold the units for $1.45 million, or $118 per square foot, to another Miami-based entity, Rentdepo LLC with principals Alain Bonvecchio and Karen Stanford Bonvecchio, according to government records.
``Call this condo arbitrage, Miami style,'' said Peter Zalewski, a principal with the Bal Harbour, Fla.-based real estate consultancy Condo Vultures LLC.
Zalewski says Fama Group earned a 16 percent cash-on-cash return, minus fees.
``This is another example of well-connected condominium bulk buyers purchasing new product at deep discounts and then immediately retrading the units for a spread,'' he said.
Even the second owner purchased the condos at a 60 percent discount compared to the $293 average closed sales price in the project, according to Zalewski's report based on Miami-Dade County records.
CondoVultures.com has documented at least five examples where bulk buyers have purchased condos and resold them for more than a 40 percent spread in the course of weeks, according to the Condo Vultures Bulk Deals Database.
In this case, the original developer Mi Primera Ilusion Villas LLC, with principal Miguel Soliman, on Jan. 6 turned over the remaining unsold units in the four-story condo to an affiliate of the project's construction lender, Eastern National Bank in Miami.
Eastern National recorded the deed transfer of the units at a combined price of $2.8 million, or $224 per square foot, according to the report.
Read more: http://www.miamiherald.com/2010/03/16/1531062/buyer-makes-200000-profit-in-20.html#ixzz0iNWWiBoj
If you need more information on the Jupiter/Tequesta and Club Communities market, may I suggest: http://www.coastalfloridarealestate.net/ and www.youtube.com/richardsites . Be sure to send along to your friends.