DeSantis quietly signs controversial condo bill. Owners are already threatening to sue

Gov. Ron DeSantis on Friday quietly signed a controversial condominium bill into law that unit owners are already threatening to sue over if lawmakers don’t fix certain provisions next legislative session.

The 154-page bill, HB 1021, is largely about creating more accountability for condominium homeowner associations and managers. But tacked on late in the process this year were other provisions from a different bill that gave developers more control over common areas in mixed-use buildings where, for instance, residential units share the premises with a hotel. The bill will become law on July 1.

Mixed-used condominium buildings are becoming increasingly popular as retirees look to settle down in buildings run like resorts by prominent hotel brands, like The Ritz-Carlton Bal Harbour and the Carillon on Miami Beach.

Combining these commercial and residential developments has created unusual legal disputes over who controls what on the property.

Attorneys on behalf of developers argue that it is essential in mixed-use buildings for the developer and hotel owners to control common spaces like the lobby, the pool, the restaurants and the elevators because they need to make sure those areas are up to their standards.

Stevan Pardo, an attorney who represents condominium unit owners in high-profile cases like the Miami Beach Carillon dispute — where for years residents and the owner of the hotel and spa have battled in court over who owns common areas — disagrees that developers would keep better care of the property than the condo association, saying the associations more personally invested in the property but they often delegate the management of it to licensed professional organizations.

“Imagine you’re living in a condominium building and all you own is the air rights of your unit. You don’t own your front door. You have no rights to have ownership or control or maintenance of your lobbies, your elevators, your hallways, none of that. That’s all controlled by a developer, and they could control it forever,” Pardo said. “It doesn’t make any sense.”

Pardo also said he believes the bill could apply much more broadly to even purely residential buildings, giving developers control of everything except for the condo units themselves.

But Mark Grant, a real estate attorney and consultant for Hotel Carillon in the Miami Beach dispute whose idea it was to make the specific changes that were eventually added to HB 1021, wrote to the Herald/Times in an email that Pardo was mistaken in his reading of the bill.

“The bottom line as to why Mr. Pardo’s statement is not correct is that there is absolutely no reason why a developer would want to retain title to and control what is customarily 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 wants nothing more to do with the common elements,” he added. “There is no profit incentive to keep control of them… operating the common elements is just a burden.”

Grant said that mixed-used condo 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 buy or not buy a unit in this type of product.”

“As for [Pardo’s] statement that the association is better able 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 collapsed in Surfside in 2021, lawmakers concluded that part of the blame was on the condominium association, which had deferred structural repairs on the building. In 2022, they updated the law to require structural integrity reserve studies that would detail how much money associations needed to set aside for those repairs.

The issue of who controls common spaces — the condo units owners and their associations or the developer — has been at the center of several South Florida lawsuits, with courts recently deciding in favor of the unit owners. The late added provisions in HB 1021 would change that dynamic, threatening to upend lawsuits still making their way through courts because it applies retroactively.

After the Herald/Times’ last story ran on these disputed provisions in HB 1021, one condo association president with a stake in the matter tried to reach out to the bill sponsor, Rep. Vicki Lopez, a Miami Republican. Richard Ortoli is president of the condominium association that is suing Epic Hotel, which controls the high-end Epic Residences in Downtown Miami, over alleged overcharges 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 not getting any of the profit.

“This arbitrary allocation of expenses, even if it is provided for in the condominium documents, is incredibly abusive,” Ortoli said.

Ortoli was unsuccessful in reaching Lopez but did meet remotely with her staff on May 22 to go over his concerns. It didn’t appear to go well, per a follow-up email Ortoli wrote to her staff two days later on which he copied the Herald/Times.

“We have not had any meaningful explanation from Rep. Lopez as to why she defends these provisions and she will inevitably become embroiled in a controversy that will do nothing to enhance her reputation as a defender of the rights of the condominium unit owners in Miami and elsewhere in Florida,” Ortoli wrote to Lopez’ legislative aide, Alessandro Marchesani.

Lopez could not be reached for comment. Her aide, Marchesani, said in an email that she was “currently flying to Israel and will be back at the beginning of July to speak on HB 1021.”

On June 11, Ortoli emailed the Herald/Times an update.

“We are hopeful that the more egregious provisions of HB 1021 will be addressed by amendments,” Ortoli wrote. “If the law is not amended, suing will definitely be an option.”

Advertisement