Hundreds lose jobs in South Florida mortgage industry
Nearly 800 workers in South Florida’s mortgage industry have lost their jobs in recent months, in addition to more than 2,800 job cuts statewide in the financial services industry, according to consulting firm Challenger, Gray & Christmas.
First NLC Financial, a lender based in Boca Raton, said the company laid off 154 employees in August and September. First Magnus Financial cut 142 jobs in Palm Beach Gardens and Fort Lauderdale in August.
Atlanta-based HomeBanc Mortgage Corp. announced it was pulling out of the mortgage business in August and laid off 80 workers in Palm Beach and Broward counties, subsequently filing for bankruptcy protection.
Some analysts predict a depressed home sales market in South Florida into 2008, the Sun-Sentinel reported.
Horse racetrack owner to sell off properties
In an effort to pay off its debts, one of the largest owners and operators of horse racetracks and wagering operations in the country is exploring the sale of its interest in a massive mixed-use development in Hallandale Beach, the Miami Herald reported.
Magna Entertainment Corp. reported losses of $23.4 million in the second quarter. As a result, the company may sell its interest in the Village at Gulfstream Park, a 60-acre project slated for 1,500 condos, 750,000 square feet of retail space and 140,000 square feet of office space over 15 years.
MEC’s ambitious plan to eliminate $600 to $700 million of debt by the end of next year includes the sale of racing interests in Florida — including land by racetracks in Hallandale Beach and Aventura and more than 400 acres in Ocala — and in Ohio, Oregon and Michigan. The company also announced plans to sell its real estate in New York, California, Maryland and Australia.
Massive Coral Gables project shifts focus to adapt to changing market
The developers of one of the biggest mixed-use projects in Coral Gables received the green light from city commissioners to cut the number of residential units by almost half, from 456 to 243, to make room for a considerably larger commercial component, the Miami Herald reported.
The 900,000-square-foot Old Spanish Village, which sits on nearly 7 acres just off Ponce Circle Park, will see a boost in its commercial space from 6 percent to 28 percent of the total project. When the city originally approved the plan in July 2006, it called for 28,000 square feet for offices and 19,000 square feet for retail; the new designs will enable developers to expand to 192,000 square feet of office space and 35,000 square feet of retail.
Led by Ralph Sanchez of Ponce Circle Developers, the team will keep the 197 multifamily units at the nine-story 3001 Ponce de Leon Boulevard and 46 nearby townhouses. But the 16-story high-rise at 2801 Ponce de Leon Boulevard, originally touted as the soon-to-be “signature residential address in historic Coral Gables,” will be converted to an office tower.
According to Sanchez, the 99 percent commercial occupancy rate in the city means it makes sense to build more office space.
Developer of failed condo conversion sees largest foreclosure lawsuit
The failed Villa Mare condo conversion in Boca Raton is facing the largest foreclosure lawsuit in Palm Beach County, valued at $50 million.
Ocean Bank, which loaned NRW Development $59.6 million in April 2006 to acquire the former Oceanview and Lakeview apartment buildings for conversion, posted a loss of $33.7 million in the second quarter. About $50 million of the loan remains unpaid, which prompted Ocean Bank to file the foreclosure lawsuit back in June against the developer.
NRW had envisioned converting the aging apartments to a luxury condo beach club with units selling for up to $1.2 million each, but the project never turned out as planned. According to two investors at J.D. Huffer & Associates in Boynton Beach and HABS Capital, NRW was scrambling to get out of the deal just months after getting into it.
The developer was initially seeking $67 million for Villa Mare late last year, but by April 2007, the asking price had fallen to $40 million, the Palm Beach Post reported.
Still, CB Richard Ellis vice president Richard Langhorne is trying to sell the property — which could have greater value marketed as a possible hotel or condo-hotel conversion — for upwards of $50 million.
Major developer goes bankrupt, sells off possessions
A South Florida developer who amassed a fortune during the residential real estate boom owes $100 million to his companies’ creditors and must sell his prized possessions to pay off the debt. The bankruptcy is the biggest yet to come out of the region’s slumping housing market.
Juan Puig started buying rental apartments and converting them into condominiums in 1994 but expanded aggressively in 2004, growing his enterprise from eight people to more than 600 by 2006, the Miami Herald reported. Puig’s companies soon became overextended with 26 or so conversion projects and, in May, sought court protection from creditors, which include local lenders like Ocean Bank and foreign establishments like Big Idea Investments, based in Hong Kong.
In addition to completing his projects so he can raise money to pay debts, Puig and his wife must relinquish belongings valued over $2,500. Under the settlement with creditors, Puig will lose a Gables Estates waterfront mansion, a condo near Aspen, 10 luxury cars, a 59-foot Ferretti yacht, more than 70 pieces of art and a Cartier watch.