State Rep. Vicki Lopez, the Republican lawmaker who led condo reforms to try to prevent another Surfside tragedy, is worried about a recent court decision over a building buyout in Miami.

It concerns the 60-year-old Biscayne 21 condominium. In 2022, Two Roads Development bought out most units from residents who said the building was too costly to maintain. But 10 owners — constituting 5 percent of residents — refused to sell. To finish the buyout, the developer-controlled condo association lowered the building’s termination threshold from requiring unanimous residential approval to 80 percent, effectively overriding the holdouts.

They sued, alleging the developer “manipulated, bullied, deceived and pressured” others to sell. The Third District Court of Appeal in Miami ruled in March that the developer couldn’t change the termination threshold. Now, the demolition is on pause and the building is empty. Lopez is concerned the case will spur similar lawsuits and make developers reconsider buying unsalvageable condominiums. She wants most condo owners to have the ability to sell off when their buildings are no longer safe or have become too pricey to maintain — and give them and the developers they sign with the ability to override small numbers of holdouts. The wave of new safety regulations following Surfside contributed to higher costs. Condos must soon comply with new safety and inspection laws, then pay for any needed repairs and pile up reserves. To top it all off, property insurance has soared. Rather than take on all this, some condo associations have disbanded and let developers buy residents out at above-market rates, in order to raze buildings and start over. But developers get a big win, too, because they can often create luxury properties on premium, oceanfront land.

The vacant Biscayne 21 condominium in Edgewater, Miami, is at the center of a developer buyout lawsuit.

 

The trade off is rotten to residents who don’t want to be forced to sell and leave their homes or neighborhood. Even with a high sale price, it’s impossible to find similar properties they can afford nearby.

“They’ve done absolutely nothing wrong. They paid their taxes, mortgage and association fees and they intended to live the rest of their lives in the condo,” said Glen Waldman of Armstrong Teasdale, who represents Biscayne 21 plaintiffs. He estimates damages would run in the “millions” and said his clients want to be back in the building, which they insist was well maintained. He also dismissed as “hysteria” fears that similar lawsuits would follow, given that buildings have different termination thresholds and structural issues.

Two Roads Development wants the judges to reconsider or have the case heard by the full bench. Otherwise, they want the judges to certify the question for the Florida Supreme Court. The group’s attorney, Susan Raffanello of Coffey Burlington, said the decision was a surprise because the same termination methods were used for decades.

She also said Biscayne 21 residents solicited the sale by hiring a broker to shop it. “This was not a situation where the developer went in and started buying up condos with a hidden agenda,” she said. (The lawsuit alleges the deal was tilted towards Two Roads.)

Those concerned about the ruling say it’s unfair to give a sliver of residents veto power when most want out. “These people otherwise face foreclosure,” said Jan Bergemann, president of Cyber Citizens for Justice, a property owner’s advocacy association. “They otherwise lose everything if they can’t sell to a developer.”

Lopez plans to introduce a bill to address the issue in the next session, in March 2025. Her plan is to clarify language in existing law that says residents in Florida can use a termination threshold of 80 percent when repairs exceed what they can collectively afford. She said she’s already hearing complaints from constituents about how unaffordable condo living has become.

“They’re asking whether the Legislature is going to bail people out … We’re not in a position to bail people out of their housing,” she said. “We’re in a position to make it easier for them to exercise their property rights. And that means they can sell it.”