Miami-based Condo.com founder Richard
Swerdlow and South Florida developer Bruce Goldstein are
partnering to launch an online platform for bulk condo
deals, The Real Deal has learned. They’re betting on the
growing distress of condo markets across the country and
developers’ desire to keep their offers confidential.
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Richard Swerdlow and Bruce Goldstein |
“This does not negatively impact the
retail buyer, nor would he take advantage of it,” Goldstein,
a former hotel and condo developer, said. “It’s a totally
different mindset.”
The website has about $100 million worth of listings and
about $500 million in the pipeline in major U.S. markets, as
well as in Latin America. Live listings include an 85-unit
bulk condo in Miami and a 185-unit condo deal in Chicago,
and the partners plan to list a deal in New York City.
They said that amid the pandemic, there’s an oversupply of
investors looking to purchase discounted deals.
Condo.com brokered deals in the last recession as a lead
generator for other brokerages that had listings, but its
website didn’t provide sellers with confidentiality, and it
did not focus on helping investors analyze deals, Swerdlow
said. (Condo.com provides weekly condo data to TRD.)
Swerdlow and Goldstein said their goal this time is to help
sell remaining condo inventory so that developers can move
on to their next projects. At first, they planned to launch
a consumer-facing platform for developers to sell directly
to consumers, but the pandemic accelerated the existing
distress in the market. Now, they say they are looking to
appeal directly to funds, insurance companies, family
officers, and other institutional investors.
Developers appear more motivated than before the pandemic to
move on. During the past six-plus months they have offered a
number of incentives to prospective buyers, including
furniture packages, covering homeowners association fees,
and offering rental income on empty units.
One Sotheby’s International Realty broker Fernando de Nuņez
y Lugones said that some condo projects have been in the
works for six years or more, and it’s time for developers to
get rid of their inventory. “It’s a quiet and silent way of
distributing this without hurting the retail sales,” he
said.
Peter Zalewski, principal at Condo Vultures Realty and a
bulk condo investor, said that the 50 percent deposit
structure in effect this cycle has forced buyers in the
Miami market to close on their units, leaving fewer bulk
opportunities this time around.
Swerdlow and Goldstein expect distress to accelerate as the
pandemic continues. Developers will need to sell in bulk to
avoid having their property foreclosed on or having their
loans enter special servicing. Once distressed pricing
becomes public, retail sales can fall apart.
“The last thing they want is the broker to have access — and
blast it to the media,” Swerdlow said.