Santorini Condo Costs Adjusted Upward

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Santorini condo costs adjusted upward

By Alexandra Clough
Palm Beach Post Staff Writer

Sunday, March 19, 2006

When is a deal not a deal? When it's a condo.

Yes, another condo project has been repriced. This time it's Santorini, part of the massive mixed-use Renaissance Commons in Boynton Beach, near the Boynton Beach Mall.

The new, higher prices require buyers to pay more for the same condos they reserved last year.

The price hike is being made to offset higher labor and materials costs.

In an Oct. 14 letter, developer James Comparato first warned buyers to expect a 15 percent price hike.

He said the hike was unavoidable in the wake of higher construction costs following Hurricane Katrina.

And Comparato's letter was sent 10 days before Hurricane Wilma.

One buyer saw the price of her two-bedroom condo rise to nearly $400,000 from $309,900.

The buyer, who asked not to be named, decided against buying at the higher price during a special "priority" sales period in January. She received a refund of her $15,000 deposit.

Price increases are understandable, the buyer said. But $90,000?

Unfortunately, that's not so unusual these days.

Many South Florida developers are scrambling to salvage their projects in the wake of rising construction costs that have outstripped revenues received from condo sales.

Some developers are getting creative by increasing density or redesigning their projects. Santorini, for instance, was redrawn from one big building into two buildings.

That splits the weight the buildings' supports must carry. The move saved money but delayed the project.

Santorini is the second Boynton Beach project to be repriced. Late last year, the Promenade condo in downtown Boynton Beach returned reservation deposits and then offered buyers the chance to buy their unit again - for thousands of dollars more.

Some buyers were shocked by the increase. (Comparato said he disclosed potential price increases in documents for Santorini reservation agreements.)

The good news is that Santorini is going forward. Half of its 348 units are sold, and construction is set to start by July, with a finish date set for 2007.

Santorini's sister communities, 242-unit San Rafael and 328-unit Villa Lago, already are sold and under construction.

Now, Comparato is looking ahead to the next part of the project: Building on the former Winchester land next door. Three projects, each with 210 condo units, are planned for the property.

But Comparato says he's going to go slowly with that one and will delay sales until after next year.

By that time, "hopefully some of this insanity will slow down in the market" and will limit price increases for materials, Comparato said.

One thing's for sure: Santorini is the first, and last, condo that Comparato wants to reprice. "Doing it twice is no fun for anybody," he said.

The ex-Marine in Floyd Johnson talked tough last week about Riviera Beach's redevelopment plan. The plan is being threatened by efforts in Tallahassee to limit government power to seize private property.

Johnson is Riviera Beach's CRA director. Last week, he spoke on the topic of private property rights at a luncheon of the PGA Corridor Association, a north Palm Beach County biz group.

The U.S. Supreme Court recently ruled local governments could use eminent domain powers to seize private property - and then transfer the land to other private owners for redevelopment.

Eminent domain powers typically have been used for traditional public purposes, such as roads or schools.

Alarmed by the public outcry over the ruling, legislators in Tallahassee are drafting bills to rein in the eminent domain power held by community redevelopment agencies.

That's bad timing for Riviera Beach.

The city is on the verge of commencing a redevelopment more than 20 years in the making. Part of the redevelopment involves displacing more than 1,000 residents to make way for a private developer's massive commercial and residential project.

"We followed the rules, and now that we're five yards from the goal line, they want to change the rules," Johnson said. But he vowed not to be deterred: "Riviera Beach is going to cross the goal line and be a model for the judicious use of eminent domain."

Johnson's rousing presentation soon had cold water thrown on it. Lawyer John Little III was so agitated he jumped up and spoke at the podium, rather than lecture from his seat.

Little, an attorney at Brigham Moore, specializes in representing property owners fighting eminent domain.

While complimenting Johnson's personal approach to government seizure, Little told the audience not to be swayed.

"Government has power. People have rights," Little said. "You're looking at competing interests."