The engine of South Florida’s factory-like condo production is what Carlos Rosso, head of condo development at the Related Group, touted in The Real Deal’s roundtable Thursday as a “new type of contract.”
Developers like Rosso are asking buyers – mostly wealthy and foreign – to cough up as much as 80 percent of a condo’s sales price, months before construction begins. “The world has changed. We’re coming back from a huge crash,” Rosso said.
Gary Saul, a leading South Florida condo attorney who represents Related as well as mega-developer Terra Group, told the South Florida Business Journal that developers are contriving ways to protect against another wave of buyers pulling out en masse.
“We got a real clear message that a buyer will walk away from a 20 percent deposit,” Saul said in an interview with the Journal.
“You want to know that the buyers are for real, and you sort of want to make sure they are the actual buyer,” Saul said, adding that his clients had buildings 100 percent contracted but only 10 percent closed.
However, tracing the cash back to an individual is nearly impossible in today’s real-estate climate, Saul said.
“If there was a law requiring a sale to a human being, you would lose a lot of South American buyers.” [South Florida Business Journal] –Emily Schmall