A New York real estate investment company with a penchant for Florida garden-style residential properties expanded its Sunshine State portfolio — again with the help of a Miami attorney.
ESG Kullen bought most of the units at the Cobblestone on the Lake condominium community in Fort Myers from Cobblestone on the Lake Corp. for $21.7 million, according to attorney Mark Meland. The Meland, Russin & Budwick partner in Miami represented ESG Kullen on the deal that closed Feb. 8.
ESG Kullen bought 147 finished units and 42 unfinished units in a community with 290 units in 13 buildings. The unfinished units are in two buildings with a shell with a roof but still need to be completed, Meland said.
ESG Kullen plans to put about $7 million into completing those two buildings and upgrading the existing units, he added.
“They have certainly a skill of value-add plays,” Meland said of ESG.
The investor owns enough condos at Cobblestone to take control of the master association and the condo and townhouse-condo associations.
The incomplete buildings posed a unique set of obstacles. Under Florida law, the two shell buildings were to be finished within seven years of the original condominium declaration to be included in the condo association, Meland said.
Because the previous owners missed that deadline, the buildings won’t be included in the condo association but are part of the master association, he added.
“What made it complicated here is that because the other condos weren’t brought into any associations, the shell buildings, they were just pads within the master association,” Meland said. “It just made it a little hairier to understand exactly what the buyer was buying.”
ESG has done similar partial condo community purchases before. Meland represented ESG in buying 93 of the 275 units at the Murano of Delray Beach for $7.5 million at the end of 2017.
“They are very active in this state,” he said.
Meland also has represented the company in dispositions, including the $40.5 million sale of the Madison Oaks apartment community in Palm Harbor last October.