Adler Group is on the hook for $1.2 million after a judge ruled it skipped out on paying a New York brokerage that landed it an equity partner for a downtown Miami apartment development.
Adler avoided paying Incitatus Real Estate $913,802, representing 1.5 percent of the equity capital the developer obtained from Boston-based CrossHarbor Capital Partners in 2021, Miami-Dade Circuit Court Judge Lisa Walsh ruled on March 18. The final judgment includes accrued interest, attorneys’ fees and costs.
Adler is led by Michael and David Adler. Incitatus is led by Alan Ballinger.
“We are evaluating our options and are likely to appeal,” said Alejandro Miyar, a partner with Berger Singerman representing Adler.
The case centers on a downtown Miami site at 230 Southwest Third Street and 300 Southwest Second Avenue, which Adler acquired in 2015 for $14.3 million. The firm and its partners, CrossHarbor and Mill Creek Residential, last year completed Modera Riverside, a 36-story tower with 345 apartments and ground-floor retail.
In 2020, Incitatus signed a finance placing agreement with Adler’s development entity to act as a finder and to source debt and equity for the project and future phases, according to the brokerage’s lawsuit.
Incitatus said it was owed a financing fee once a jointly executed financing agreement was signed and initial funding was delivered, with a fee schedule of 1.5 percent for equity and preferred equity. The brokerage alleged that Incitatus introduced CrossHarbor to Adler, organized calls, circulated materials, obtained a non-disclosure agreement and helped sustain talks over several months.
Adler claimed in 2021 that it had sold the project to Mill Creek Residential, but Incitatus said that was misleading because Adler had actually struck a joint venture that left it with an ongoing equity stake. The lawsuit also says Adler and related entities concealed their continuing talks with CrossHarbor and Mill Creek while the project moved forward under the Modera Riverside name.
Adler principal David Adler acknowledged in 2023 that Incitatus had “brought the equity” and that CrossHarbor held a 90 percent equity interest, the lawsuit states. Adler and Mill Creek each held 5 percent. Incitatus then invoiced Adler for $855,000 before updating the claim to $913,802 once the final equity figure was confirmed.
Incitatus argued the arrangement was a finder’s fee agreement, not a real estate brokerage contract, and said it was retained to source the project’s capital stack rather than to buy, sell, lease or broker real property. That distinction was important because Adler had already hired another brokerage to handle the sale, paying a $250,000 commission fee, the lawsuit states.
The lawsuit also accused Adler of acting in bad faith by attempting to terminate the agreement after the fee dispute surfaced and by calling Incitatus’s invoice false. Incitatus said it preserved its right to payment by delivering a list of financial participants within 15 days of termination, as the agreement required.