Governor. Ron DeSantis On Friday, he quietly signed a controversial condo bill that unit owners are already threatening to sue over if lawmakers don’t fix some provisions in the next legislative session.
The 154-page bill, HB1021, is largely aimed at increasing the accountability of homeowners’ associations and condominium managers. But added late in the process this year there were other provisions of a different invoice which gave developers more control over common areas in mixed-use buildings where, for example, residential units share premises with a hotel. The bill will come into force on July 1.
Developers’ attorneys argue that it is essential in mixed-use buildings that the developer and hotel owners control common areas like the lobby, pool, restaurants and elevators because they must ensure that these areas comply with their standards. .
Stevan Pardo, an attorney who represents condo unit owners in high-profile cases like the Miami Beach Carillon dispute — where for years residents and the hotel and spa owner fought in court over know who owns the common areas – disagrees that developers would take better care of the property than the condo association, saying that associations are more personally invested in the property but that They often delegate management to approved professional organizations.
“Imagine you live in a condominium and you only own the air rights to your unit. You do not own your front door. You have no right to own, control or maintain your lobbies, your elevators, your hallways, any of that. All of this is controlled by a developer, and he could control it forever,” Pardo said. “It does not mean anything.”
Pardo also said he thinks the bill could apply much more broadly, even to purely residential buildings, giving developers control of everything except the condominium units themselves.
But Mark Grant, a real estate attorney and consultant for the Carillon Hotel in the Miami Beach litigation, whose idea it was to make the specific changes that were ultimately added to HB 1021, wrote to the Herald/Times in an email that Pardo was wrong in his reading of the bill.
“Ultimately, the reason Mr. Pardo’s statement is not correct is because there is absolutely no reason for a developer to want to retain title and control what are usually common elements in a residential condominium,” Grant said.
“In a residential condominium, the developer wants to sell all the units and after 90% of the units are sold, the developer no longer wants to deal with the common elements,” he added. “There is no profit incentive to maintain control…exploiting the commons is just a burden.” »
Grant said mixed-use condominium buildings under the new law “must have a disclosure summary that summarizes the structure and informs buyers that the association will not control the building.” Buyers are free to purchase or not a unit in this type of product.
“As for (Pardo’s) statement that the association is better suited to take care of the structure, I give the Surfside tragedy as an example of why that is not accurate,” Grant said . After the Champlain Towers collapse in Surfside in 2021, lawmakers concluded that part of the fault lay with the condo association, which postponed structural repairs to the building. In 2022, they updated the law to require structural integrity reserve studies that would detail how much money associations had to set aside for these repairs.
The question of who controls common areas – the condominium unit owners and their associations or the developer – has been the focus of several lawsuits in South Florida, with courts recently ruling in favor of unit owners . Provisions added recently in HB 1021 would change this dynamic, threatening to upend lawsuits still pending in court because they apply retroactively.
After the Herald/Times the last story was broadcast regarding these contested provisions of HB 1021, a condo association president involved in the case attempted to contact the bill’s sponsor, Rep. Vicki Lopez, a Republican from Miani. Richard Ortoli is president of the condominium association suing Epic Hotel, which controls the upscale Epic Residences in downtown Miami over alleged overcharging for shared facilities.
Ortoli told the Herald/Times that the unit owners were footing too much of the bill to renovate shared spaces in that building, like the hotel lobby, and were not getting any profit.
“This arbitrary distribution of expenses, even if provided for in the co-ownership deeds, is incredibly abusive,” Ortoli said.
Ortoli was unable to reach Lopez, but met remotely with his team on May 22 to voice his concerns. That doesn’t appear to have gone well, based on a follow-up email Ortoli wrote to his team two days later, in which he copied the Herald/Times.
“We have had no meaningful explanation from Rep. Lopez as to why she is defending these provisions and she will inevitably find herself embroiled in a controversy that will do nothing to enhance her reputation as a defender of property owners’ rights. condominium units in Miami and elsewhere in Florida,” Ortoli wrote to Lopez’s legislative aide, Alessandro Marchesani.
Lopez could not be reached for comment. Her aide, Marchesani, said in an email that she is “currently taking a flight to Israel and will return in early July to speak on HB 1021.”
On June 11, Ortoli sent an update to the Herald/Times.
“We hope that the most egregious provisions of HB 1021 will be corrected through amendments,” Ortoli wrote. “If the law is not changed, legal action will certainly be an option. »
