WEST PALM BEACH — The development firm eyeing Portofino South Condominium has sweetened its offer, raising it to $295 million from $202 million, an amount the company says is its "best and final" one.

The complex, completed in 1971 and spanning 12 stories, offers a mix of one-, two-, and three-bedroom layouts, with balconies facing the Intracoastal Waterway, Palm Beach and the Atlantic Ocean.

The initial buyout offer was made in January by BEKO Equities, a joint venture between Gilbert Benhamou, founder of Immocorp Capital, and O.D. Kobo, a Hong Kong-based asset manager. It was increased to $245 million and now it is at $295 million. “The purchase price is way over market value, so owners are getting back the cost of any improvements unless they installed a gold toilet,” BEKO wrote in a letter to owners at Portofino South. Gregg Greer, the real estate agent urging owners to accept the offer, called it "a chance for some of them to become millionaires that will allow for the purchase of a very nice residence elsewhere." The $93 million increase in the offer comes amid a six-month debate among residents at the high-rise about whether to accept the offer. The dissension has caused friction between some residents and the condo association's governing board. On June 19, a recall petition was filed to remove and replace five of the nine association board members. Regina Sullivan, who owns a unit in the complex, is behind the recall effort, but she said the recall effort has nothing to do with the controversy over the sale of the building.

Is four times market value enough to buy this West Palm Beach condo? See photos of Portofino South Condominiums.

 

Still, Sullivan said she is frustrated by what she said is the insufficient amount of communication about the Beko Equities offer from the board.

"Long before the offer to buy the building was made, there was growing dissatisfaction with the lack of transparency and cost overruns associated with capital projects," she said.

 

"That is what the recall is about, but there has also been a lack of information from the board about the purchase as well. Owners need to know what the cost is of maintaining the building, so they can make an informed decision about whether to sell."

The current board president, Greg D'Elia, declined to comment either on Sullivan's recall effort or her accusations.

There has been some confusion related to how Beko/Immocorp has determined what the offers should be for the condominiums.

In emails to owners, the development firm said the offers vary by the size and location. They are, though, significantly above fair market value. An owner on the fifth floor was offered $1.9 million, four times the unit's market value, according to the Palm Beach County Property Appraiser's Office.

Still, the developer has a hurdle to overcome. It only takes seven owners, or 5% of the 140 condos, to block the sale, and opponents say there is more than enough to result in that occurring.

Melanie Holland is one of those owners who has no interest in selling.

"What the developer does not realize is that many of the owners are already multimillionaires. Their condo is a second and third home," she said.

"This is a very well-maintained building, and most of the owners have no problem doing what needs to be done to keep it that way. Whatever they want to pay us, we would never be able to find another place with the views we have now.”

Some views even face Mar-a-Lago, the Palm Beach estate of President Donald Trump.

The buyout marks the latest effort by a developer to acquire an aging condo building whose owners face high maintenance costs. They have become common amid skyrocketing insurance costs and the pricey repairs required after the 2021 collapse of Champlain Towers South in Surfside. Portofino South is just the latest building along Flagler Drive to catch a developer's attention.

Sullivan said Portofino South is now dealing with a cost overrun of $4.1 million, and that to learn why that occurred, she has hired an attorney at her expense.

"The board has not responded to our requests for information," Sullivan said.

Immocorp is building the Arte at the District in Northwood, a project that will deliver over 380 residences, featuring luxury amenities and more than 65,000 square feet of retail and commercial space, as well as restaurants, boutique shops, and galleries.

Holland said the developer has grown more aggressive in its effort to acquire the building. In emails to owners, Immocorp has set an Aug. 2 deadline for contract signing. She noted that Greer continues to repeatedly contact owners on a weekly basis urging them to return their contracts as soon as possible.

"This is all about bullying people into selling," Holland said.

Developer says it has set an Aug. 2 deadline

In one of his emails to residents, Greer emphasized he and Immocorp want residents to reach out to them with concerns or questions.

“We are currently assessing owner commitment,” Greer wrote. “If you have not yet decided or have specific concerns, please call us so we can address them directly. Our goal is to determine the exact percentage of owners committed to the deal. Returning your documents early helps ensure we meet our deadlines and move forward effectively."

Greer said in the letter that owners should consider the long-term responsibilities of owning an older building, citing past and upcoming assessments that total more than $10 million. These expenses are a reality of maintaining older structures and tend to increase over time, especially with new code requirements, he added.

"While we believe we have presented a strong offer, the final decision rests with each individual owner," he also wrote. "It is important to remember that, as owners, you are collectively affected by one another’s decisions. Some of you may be concerned that a few holdouts could prevent a sale; however, please note that the buyer is willing to accept some risk and may proceed with the majority of units even if some owners choose not to sell.”

Immocorp has not revealed what it plans to do with Portofino South, at 3800 Washington Road, if it succeeds in its takeover attempt, but it is expected to demolish the building and replace it with a new structure.