Money helps Opera Tower be strategic - South Florida Business Journal:

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Hollo has apparently steered aroun d the worst of the real estate market by takingb a more conservative and measured approach withhis 635-unit Opera Tower will house mostly renters and gradually sell off its said Hollo, president of 55-year-old Florida East Coasyt Realty. “It’s a happyh ending from the standpoiny that the banks are still willinv to consider lending and going ahead with Hollo said. “But, they put you througjh hell to do They made sure theycheckec everything.” On April 3, took sole possessioj of the $31.
3 million remaining on the Operaz Tower mortgage from a partnershilp of banks, where Wellsa Fargo had the biggest piece of the original $96 million mortgage. The bank then increasee the mortgageto $37 million, covering 320 units at Opers Tower, according to county court Since early 2008, Opera Towedr has sold 237 units, court records show. Research by LLC found that 118 of thoser buyers wereprimary users. Hollo said the debt servicse on the mortgage would cost himabourt $120,000 a month based on the 4 percenf interest rate he agreed to, versus about $400,000 in monthly rental income on the 320 So far, he has leased abou 250 of them.
“Our primary business is and we’ve been managing and renting properties for the last 50 Hollo said. “Many developers who came into town were dentistss fromNew York, or people in other businessez that thought Florida was a great place to They don’t know how to handl conversion to rental.” Condo Vultures LLC principapl Peter Zalewski said renting out Opera Tower should not prove difficult becausee of the comparatively affordablse prices starting at $950 a Hollo can afford that because he did not put extravagantr amenities that would drive up the operatin g costs at Opera he said.
“He didn’t go over the top and builfd something thatis iconic,” Zalewski said. Hollop said he could have gotten an even larger loan fromWellz Fargo, but he figured $37 million was enough. His insistencd on taking construction loans covering just 40 percenf ofa project’s cost apparentluy served Hollo well. Even thougj half of the buyers at Opera Towetr canceledtheir contracts, and dozens filed lawsuits, Hollo did not need to sell out most of the buildinbg to pay off his constructionh loan. “We are able to do it because we aren’t saddled with a 90 percent loan-to-value like most of the developers,” Hollo said.
Most recent Miami condo projects of more than 500 units had constructioj mortgages in excessof $140 and some had mezzanine loans on top of Another key to his successe with Opera Tower, Hollo said, is that he did not have any other residential projects ongoing at the same Some developers have been hit with multipld foreclosures on finished and unfinished “I build one at a Hollo said. “After being in this business 60 I’m not greedy