Article Courtesy of The Tampa Bay Times
By Susan Taylor Martin
Published June 27, 2019
TAMPA — As the demand for apartments continues to grow,
two more Tampa Bay condo communities are on track to become exclusively
Last week, a New
York-based company paid $7.3 million for 109 of the 240
condos in Enclave at Sable Point in St. Petersburg's
Pinellas Point area.
And on June 7, Tampa-based Robbins Property Associates and a
partner obtained financing to buy 312 of the 390 condos in
Arbors at Carrollwood in north Tampa.
The transactions are the latest in a trend that caused an
uproar a few years ago and led to changes in state law to
better protect individual condo owners from so-called "bulk
Termination of a condo association used to require approval
of 100 percent of unit owners. But as foreclosures and two
active hurricane seasons left many units damaged and vacant,
the Florida Legislature in 2007 amended the law so that 80
percent of owners could terminate an association if no more
than 10 percent of owners were opposed.
Investors, realizing that the new law could help them
convert condos to apartments, began buying up units by the
score and renting them out. Demand for rentals was great
because many people had lost their homes to storms or,
starting in 2009, foreclosure. But the bulk purchases led to
"fractured'' communities — half rental and half condo — and
complaints from individual owners that their units were
plunging in value.
Robbins Property Associates and LEM Capital have
bought 312 of the units in Arbors at Carrollwood in north Tampa.
Owners in several Tampa Bay communities including the Slade at Channelside
alleged that they were being bullied into selling to investors. The outcry
prompted lawmakers to enact changes in 2017 that enabled just 5 percent of
owners to block conversion and required owners to be paid 100 percent of
fair market value for their units.
"A lot of communities are stabilized now, but there still communities out
there that are very fractured and challenged by the disparity in value
between what the units sold for and what they are worth today,'' said Darron
Kattan of the brokerage Franklin Street, which arranged the sale of Enclave
at Sable Point.
Kattan said that about 10 percent of the unit owners have homestead
exemptions, indicating that is their primary residence. Since the deal
closed, the buyer, Axonic Properties, has purchased another 22 units,
although it is not clear how many of those were homesteaded.
Both Enclave and Arbors at Carrollwood began as rentals that converted to
condos and now are being reconverted to apartments.
At Arbors, built in 1999 on more than 56 acres, Robbins and partner LEM
Capital want "to assemble as many units as possible,'' said Mitch Sinberg of
Berkadia, the mortgage company that arranged the loan." The more they have,
the more they can create value at the property. But if they don't assemble
all of them, it by no means derails the business plan.'' The loan amount was
Property appraiser records show that only six of the Arbor's individually
owned units have homesteads. Should any owners decide to sell, they could do
so to either Robbins or a third party.
While condos in fractured communities often lose their value, Sinberg said
Robbins is planning improvements that will make the Arbors more desirable.
"If you look at the property now, it looks tired,'' he said. "Robbins is
planing an overhaul to make sure that both exteriors and interiors look like
fresh, clean new assets and I think that will benefit the unit owners."