Editor’s note: High stakes, short memories

Developers are eternal optimists. And forgetful masochists.

These gruff street fighters of the real estate world often must buck the consensus view, time the market perfectly and take reputational and financial risks that would drive the average person to a breakdown.

Few builders better exemplify this type than Jorge Pérez, the condo king of Miami, who is running the Related Group with his son Jon Paul. The focus of our cover story this month, Pérez is not only aggressively starting new projects in the hometown he’s dominated, he’s also moving quickly to build up to 100 projects across the country and in Latin America.

Never mind that Related has been burned before when attempting to branch out — twice in Las Vegas, including in 2005, when it partnered with George Clooney on a development ultimately derailed by rising construction costs after sales had already started.

Pérez said his most important lesson in humility came from the Great Recession, when he stood in a ballroom filled with his creditors to renegotiate nearly $2 billion he owed.

But developers have short memories, and Related’s goal is to diversify outside the extreme highs and lows of the Miami market. Can he pull it off? Check out our story on page 66.

Overall, there’s much to be optimistic about.

While it’s well known that the residential market is still firing on all cylinders — one buyer in Westchester lost out on six bidding wars in a row (page 32) — the commercial sector, too, is getting a new lease on life.

In Manhattan, office tenants are now taking their spaces off the sublease market — space they desperately wanted to shed during the pandemic — anticipating an earlier-than-expected return to the workplace (page 24).

While only a small percentage of Manhattan office workers had returned as of last month, that figure is expected to approach two-thirds by September, according to a survey by the Partnership for New York City.

When it comes to the national foreclosure crisis, the government’s forbearance program has saved homeowners from default by allowing them skip mortgage payments for up to 18 months. About two-thirds of the 4.3 million borrowers who were in forbearance a year ago have since exited the program.

That said, there are still millions of homeowners in trouble, and what happens when the eviction moratorium ends is anybody’s guess (page 72).

Elsewhere, we’ve got the second installment of our Hamptons special section (page 35). Even in a hot market, there are some hard-to-sell dogs that can’t seem to find a buyer — we take a closer look at these problematic properties on page 38. And just how much of a price premium does an East End water view command, anyway? We break it down on page 46.

In a story that’s bound to make you jealous, we take a look at some of the investors — including Gen Z-ers — who have made millions in cryptocurrency and are now looking to park some of that money in the (relatively) stable asset class of real estate. One 24-year-old investor’s latest purchase — a $1.8 million pad in NoMad — was paid for in cash with the proceeds of his bets (page 55).

Finally, our Closing interview this month is one of the most moving we’ve ever published. Janice Mac Avoy, the co-head of real estate litigation at Fried Frank, talks about how she loves cross-examination and “twisting [a witness] in knots.” But she also opens up about the murder of her sister last year, the dissolution of her marriage and abortion (page 86).

“I have had such a tremendous amount of support from folks really being there for me,” she said. “If you don’t talk about [your feelings], you’re not going to get that.”

Enjoy the issue.