Oversight and control of Florida residential communities governed by associations is supposed to transfer from the developer to homeowners as soon as the majority of parcels are sold.
But at a Homestead townhouse complex, consisting of 117 two-story chalk white homes with brown accents neatly tucked in near Florida’s Turnpike, a developer is accused of clinging to control for two decades.
Affiliates of developer Prime Homes at Villa Portofino East, an entity tied to Prime Group and its PMG Asset Services division, have remained in power, appointing their employees and representatives to the HOA board, according to a lawsuit.
While the developer-controlled board and its attorneys maintained in letters to residents and at meetings that the threshold to pass the reins to homeowners hasn’t been met, residents and the suit argue otherwise. They also claim the HOA, led by the developer-controlled board, has neglected maintenance of common areas such as a gate, the pool, fences, stormwater management and pavers.
Residents claim that transferred land was improperly factored into a calculation to delay a change in organizational power.
They point to a series of re-plats and parcel transfers at the complex by the developer-controlled HOA to Prime Group-tied entities. The suit claims that even though the conveyed land is being used for commercial purposes — construction of a new hotel — the HOA is still using these parcels as part of the total residential lots calculation in order to assert the claim that not enough parcels have been sold and thus it’s not yet time to turn over the HOA to homeowners, according to the suit, filing attorney and a resident.
“It’s parcel manipulation,” said Madeline Garcia, a Villa Portofino East homeowner. “The developer does have the right to annex/withdraw property but in our case, they are asserting that that withdrawn property transferred for a hotel commercial expansion is still a part of our residential community. … You don’t have to be a lawyer to see and get what they’re trying to do.”
Garcia sued Villa Portofino East HOA and PMG Asset Services in Miami-Dade Circuit Court last month, raising claims for negligence and violation of the state law requiring HOA turnover.
Under state HOA law, a developer has to turn over board control to residents within three months after 90 percent of all parcels in all phases in a complex are sold or otherwise conveyed to homeowners or others not tied to the developer. State law outlines other thresholds for turnover, such as foreclosure or receivership.
Yet, the Villa Portofino East developer-controlled HOA still counts transferred land as residential parcels, “artificially suppressing the residential conveyance ratio below the statutory threshold,” the suit says.
The majority, if not all, of the 117 completed townhomes have been sold, according to records and Eduardo Gomez, the attorney who filed the suit on behalf of Garcia said.
“When the denominator is properly limited to 117 townhomes, the conveyance ratio clearly clears 90 percent and it should have been turned over,” Gomez said. “That’s the game the developer is playing.”
In 2022, Prime Group affiliates sought rezoning of residential and common area lots at the complex to commercial to allow for the construction of a 98-key Homewood Suites hotel, according to the application. Photos provided by residents show construction by now has reached the hotel’s seventh floor.
The hotel is a new wing, expanding the existing five-story 126-key Hampton Inn & Suites that’s immediately south of Villa Portofino East.
Prime Homes at Villa Portofino East, an affiliate of Prime Group, a Hollywood-based residential and commercial real estate firm led by founder Fred Abbo and CEO Larry Abbo, completed development of the 117 townhomes at Villa Portofino East in 2007, records show. PMG Asset is Prime Group’s loan workout, construction management, property management, land planning and entitlements, marketing, sales and leasing services division, PMG’s LinkedIn shows.
Villa Portofino East HOA’s board is led by Vicky Cortes, Deslyn Henry and Mary Papantonis, state records show. Cortes is Prime’s corporate operations manager, Papantonis is a paralegal at the firm, and Henry works at PMG, according to Prime’s website and LinkedIn accounts.
The “developer is anxious to turn over the association and will do so at the legally appropriate time,” Geoffrey C. Bennett, an attorney for PMG said in an emailed statement.
Villa Portofino East is hardly the only South Florida complex governed by an association where homeowners have alleged the developer has illegally held onto control of the board for too long.
At Brickell Key, the triangular man-made island home to 11 condo buildings off Miami’s Brickell, five condo associations sued Swire Properties, which developed Brickell Key, alleging Swire is illegally continuing to control the master association and use its power to saddle unit owners with a $32.3 million seawall and baywalk repair assessment. This, even though Swire and the city of Miami own the majority of the seawall, which isn’t even common property on Brickell Key, the lawsuit claims.
Attorneys for the Villa Portofino East HOA have maintained the turnover thresholds have not been reached, though homeowners have been angered by the lack of details and backup information to support this claim. Tensions flared at a recent HOA meeting.
“If you guys are arguing that we haven’t reached the 90 percent threshold for turnover, can you please state for the record what percentage have we reached and have you researched that thoroughly?” a homeowner asked, according to a video of the meeting shared with The Real Deal.
“Under 90 percent,” an HOA representative responded.
When the homeowner pressed for details, including what percent of the parcels have been sold and whether this data will be provided, the HOA representative said he doesn’t have this information.
“We are able to get that information … I am not going to commit to providing the data. What I can tell is we are under 90 percent … I am not going to be cross examined. Your question has been answered,” he said.
Garcia’s lawsuit alleges neglected upkeep of the gate motor system, alleging the Villa Portofino East gate has been “left fully open” for most of the past four years, the pool permit has expired after the Florida Department of Health issued violation notices in past years, broken brick pavers, asphalt potholes, and that fencing is in disrepair, according to the complaint.
The HOA also has failed to address flooding since 2022, and the community sign has rust, peeling paint and splitting wooden support posts, the suit says.
Garcia said she pays about $250 in monthly assessments, “not a lot” but questionable considering so much of the complex is neglected.
Stephen De La Fuente, who bought his Villa Portofino East townhome in 2019, said the entrance gate has been broken for about five years. He pays about $240 a month in assessments.
“They collect money, and we don’t see any change in the community,” he said. “We are trying to do a turnover because we don’t see a change here.”
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