ST Residential, a unit of Starwood Capital Group, has sold the 240 unsold condominium units at Sunrise’s 396-unit Tao project in a $50 million bulk deal. Miami Beach-based Crescent Heights was the buyer, paying around $165 per foot, or $209,000 per unit, and plans to rent them out. The deal was brokered by International Sales Group. Starwood acquired Tao after the failure of the project’s original lender, Corus Bank. [Miami Herald] 

Florida condominium projects set forth the death spiral of Corus Bancshares, and new owner MB Financial Bank of Chicago is assuming Corus Bank’s 11 branches and $3 billion in cash and marketable securities. The bank still has over $1 billion worth of Florida condo loans to unload in the next 30 days, federal bank regulators say, including 13 with mortgages of more than $100 million. Problem projects include the 342 unsold units in the Tao condominium in Sunrise; the 216-unit Aventine at a Boynton Beach apartment complex; and a pending foreclosure lawsuit against the owner of the Onyx on the Bay condo in Miami, with a $44.1 million mortgage covering 41 unsold units. Another 13 projects are targeted in the aftermath of Corus’ failure.

Part two — Developments fail, banks follow, the blood begins flowing.

The trigger to the increasing velocity of recent bulk deals of South Florida real estate assets is the culmination of a chain of events in this historic boom/bust cycle.

Florida’s population is decreasing. Unemployment has more than doubled and continues to increase. According to the Clerk of Courts in Miami-Dade, Broward, and Palm Beach counties, foreclosures have multiplied exponentially to a projected 200,000 filings in 2009.

Pre-construction deposit holders on condominium units are canceling closings on completed units in the thousands. Project scale foreclosures and lawsuits between lenders and developers are accelerating. Buyers seeking refunds of deposits are jamming the court houses and creating a cottage industry for law firms.
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