UPDATED, May 3, 1:18 p.m.: Unable to secure financing amid rising construction costs, a Chilean condo developer handed over a stalled project site in Bay Harbor Islands to another firm, The Real Deal has learned.
Supply chain issues, escalating costs and labor shortages pose the greatest threats to condo developers in South Florida today, as demand for units remains high. Foreign developers with less experience building in Miami face additional hurdles, attorneys and developers say.
Miami-based Alta Developers took over the Ambienta Bay Harbor Islands project and is relaunching sales of the planned seven-story, 30-unit luxury condo building, Alta CEO Raimundo Onetto told TRD. It’s now called Alana.
The project, planned for the site at 9901 West Bay Harbor Drive, launched sales more than a year ago. Santiago, Chile-based Ambienta Developers, led by CEO Claudio Cordero, was unable to get construction financing and also faced rising construction costs, Onetto said. It was set to be the first U.S. development for Ambienta. Construction has not started.
Ambienta reached out to Alta, Onetto said, and Alta took over the project at no cost. Alta will be raising prices for some units, up 30 percent in some cases. Property records show Ambienta assembled the site for about $5.9 million beginning in 2018.
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About 20 units had been presold, said Edgardo Defortuna, president and CEO of Fortune International Group, which handles sales for the project.
In early March, Fortune Development Sales recorded a lien for more than $200,000 in unpaid commissions against Millenium Ambienta Corporation. Defortuna said the sales and marketing firm filed the lien “not knowing what was going to happen with the overall life of the project” and to protect his agents.
Buyers were also in the dark, sources told TRD. And records show other contractors were also owed money, including De Los Reyes Engineering, Maestre Construction and Ferguson Waterworks.
Buyers will be able to sign a new contract, likely at a higher price, Onetto said. He is in the process of repricing costs and changing the marketing materials. The design and unit configuration will remain the same, with architect Luis Revuelta designing the building.
“We’re working very closely with [Onetto] to keep this project moving forward and give the opportunity to the buyers to continue with this acquisition,” Defortuna said.
The building is expected to have two- and three-bedroom units ranging from 1,229 square feet to 1,662 square feet. It will feature a double-height lobby, glass facade, and gardens designed by David J. Odishoo. Each unit will include two parking spaces and storage.
The previous developer didn’t tap into the buyers’ deposits, which were in escrow, which means they will have their money returned to them if they don’t buy units in the new project. Even if they opt out of signing new contracts, buyers will likely be at a disadvantage, paying higher prices than if they had purchased units a year ago at other projects that are moving forward.
The new development condo market in Miami-Dade has boomed over the past year, with developers launching — and selling out — newly planned developments in record time, and raising prices along the way.
In March of last year, when Ambienta launched sales, asking prices ranged from $761,000 to $1.2 million. The developer was expected to break ground last June, and begin recording closings next spring.
It will relaunch in about two weeks. Fortune will lead sales and marketing of Alana, Onetto said.
Correction: An earlier version of this story incorrectly identified the project’s proximity to the bay.