Dark Tower

Las Olas River House was supposed to be the life of the party, not a hollow high-rise

On a recent Tuesday afternoon, Philip Freedman steps out of an elevator on the 39th floor of Broward County's tallest building and into a condo fit for an episode of MTV Cribs.

A dapper and affable salesman, Freedman cues Frank Sinatra's "I've Got the World on a String," then walks his alligator-skin shoes along the dark wood floors. He passes the black granite countertops and the Sub-Zero appliances in the kitchen on his way to the 500-square-foot terrace that demonstrates why someone just might plunk down $1.95 million for this opulent, 3,400-square-foot pad at Las Olas River House.

"This unit gives you the terrace that wraps around," he says. Outside the glass doors is a view of Broward unmatched in any other building in South Florida. The city hums below as workmen tar the roof of the Fort Lauderdale Museum of Art, a marching band plays several blocks away, and a park fountain sprays. To the north are the hazy outlines of beach condos and the fetid ziggurat nine miles away better-known as the county landfill. To the west, 'burbs sprawl toward the Everglades. To the south, in the distance, a tiny bar graph shaped like downtown Miami breaks the horizon.

River House salesman Philip Freedman surveys the mortals below.
Colby Katz
River House salesman Philip Freedman surveys the mortals below.

"There's a beautiful sunset view here, and at night, with the airport, all the lights twinkle," Freedman says. "It's very exciting."

But not nearly as exciting as the project's motto -- "Where Las Olas Meets Fifth Avenue" -- would imply. In fact, the building is surprisingly empty. During the day, the dual, 42-story, 452-foot-tall blue towers of the luxury condo are visible from all over. At night, though, its 287 units cast so few lights that the behemoth appears like a silhouette on the skyline, as sparsely lit as the commercial towers it dwarfs.

Why, fully 10 months after it opened, does the city's most conspicuous residence resemble a haunted house? Quite simply, because as much as you might like to live there, not many people actually do.

According to county property records, 68 of 287 units in River House remain unsold. What's more, records suggest that only about 25 percent of people who purchased a condo at River House live in the building. Meet the people who bought a piece of the American dream, Fort Lauderdale-style:

Of 219 owners, only 55 have registered a River House mailing address with the county.

Of those 55, only ten have registered homestead exemptions, a tax break for primary residences.

Of the owners, 63 registered addresses outside of Florida. They live in 20 different states, the U.S. Virgin Islands, and three foreign countries: Canada, Germany, and the Bahamas.

Corporations own 13 units.

Thirteen groups of people own more than one unit.

River House billboard great Dan Marino, who purchased unit 3302 for $1.35 million, lists his Weston home as his mailing address.

Even more telling, of the 219 units that have been sold, roughly 33 have been put back up for sale (some might say "flipped"), according to a recent review of records on the Multiple Listings Service, a widely used database of properties for sale. Many of these re-sellers are expecting lucrative, if unrealistic, returns:

James M. Domesek and April Hollis, both of Fort Lauderdale, purchased unit 2509 in January for $624,000 and unit 3307 for $874,000. They are now asking $995,000 and $1.7 million, respectively.

Ursa Investment Inc., a company controlled by Miami residents Oscar Chapa and Saul Uribe, bought unit 2006 in February for $815,000. It's now listed for sale at $930,000.

Gaetano and Frances Rizzo, of Clinton Township, Michigan, bought unit 2910 for $1.145 million in January. They listed it for sale at $2.095 million.

These numbers seem to bear out what many have been speculating at the water cooler: New condominiums in South Florida, particularly in Miami-Dade County, have come to represent commodities more than homes. "Just doing straw polls, it's been about 70 to 80 percent of the units bought by speculative investors planning on cashing in on the South Florida real estate pot of gold," says Jack McCabe, a real-estate industry analyst from Deerfield Beach.

With so much money in real estate these days, it's shocking that River House needed public assistance. But it did. Years before the housing boom sent South Florida real-estate prices skyrocketing, the Fort Lauderdale City Commission was trying desperately to encourage development in the city center. It found a partner in the Tribune Co., parent company of the Sun-Sentinel, which at the time owned a parcel of land next to its sand-colored skyscraper.

To make the land more attractive for potential developers, Tribune asked the Fort Lauderdale City Commission for a break on impact fees -- money that developers pay to compensate for increased traffic brought by any new project. The commission complied, agreeing to waive $1.6 million in fees.

That paved the way, literally, for Tarragon South Development Corp.'s Las Olas River House.

Fort Lauderdale Mayor Jim Naugle, an ardent critic of overdevelopment in the city, remains bitter about subsidizing such an extravagant housing project. "We forgave $1.6 million in impact fees," he says. "That's the price of a single condo at River House."

But the results are truly amazing. Sitting in a 16th-floor office in the Sun-Sentinel building, James R. Helman, Tarragon South's executive vice president, points out the window. His Las Olas River House rises next door, its sharp lines stretching so high that it reaches beyond the window's view.

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