New York developer Shahab Karmely thought he had sealed the deal: a small office building on prime Brickell land was his for $32 million.
The site screamed for redevelopment. But the property owner, Taplin Company — whose founder, Martin Taplin, had earlier fallen to his death in a suicide amid mounting financial woes — suddenly backed out.
Karmely claims Taplin got cold feet because the company had secretly shopped his offer around to other bidders, in violation of an exclusivity agreement, according to a lawsuit filed last week in Miami-Dade County circuit court. One competitor bit, according to the suit, agreeing to pay $10 million more than Karmely’s offer, which he made through his firm KAR Properties.
“Unbeknownst to KAR … Taplin was using KAR as a stalking horse to attract and negotiate the sale of the membership interest to third parties,” states the complaint, which alleges breach of contract, unjust enrichment and fraud.
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The dispute over the 10-story boutique office building shows how desperate developers are to snatch up properties in Miami’s urban core, where condos seem to sprout from every empty plot. Good land is the lifeblood of builders — and they’re willing to fight for it. Despite overseas cash slowing from a torrent to a trickle, developers are making a big bet that the market will come back strong.
$32 million Price for a controlling interest in the land at 1428 Brickell Ave.
“This is one of the last remaining jewels of property on the Brickell corridor,” said Mason Pertnoy, Karmely’s lawyer.
The winning bidder’s identity remains unknown.
The Taplin Company declined to comment and has not yet submitted a response in court.
‘But honey, she’s so beautiful!’
It’s not the only lawsuit swirling around the 1.15-acre parcel at 1428 Brickell Ave.
In 2014, a lender initiated foreclosure proceedings on the site over mortgages worth about $8.7 million. Then, last year, Taplin’s son Andrew filed a lawsuit accusing his father of using income from the property to “fund personal expenses through extravagant payroll and benefits.” That claim valued the land at $50 million.
The Taplin Company is also suing another lender, Walter Defortuna of Fortune International Realty, claiming Defortuna tried to force the company to sell at a below-market cost of $23 million. All of the cases are ongoing.
And it’s not the first time the Taplins have been accused of cutting deals with more than one buyer. Earlier this spring, two different firms said they had agreed to purchase the family’s famed Sagamore Hotel in South Beach. A Fort Lauderdale buyer ultimately emerged with the hotel for $63 million.
That’s like if my wife catches me in bed with a 22-year-old and I say, ‘But honey, she’s so beautiful.’
Shahab Karmely, developer
The Brickell office building dispute hinges on a letter of intent signed by Karmely and Neil Sazant, Martin Taplin’s son-in-law and the president of the Taplin Corporation.
The letter, dated June 17, included confidentiality and exclusivity provisions, according to court filings by the plaintiff. In an interview, Karmely said he was aware of the controversy at the Sagamore and wanted “ironclad” protections. He also provided proof of his funds: a bank account with $45 million in cash.
The agreement entitled KAR to an 80 percent interest in the property for $32 million, minus the cost of paying off outstanding mortgages. Taplin would retain control of a 20 percent stake.
But the letter, along with its confidentiality and exclusivity clauses, expired July 1. Karmely said he and Taplin executives came to an oral agreement to extend those provisions. And the lawsuit says the parties’ continued negotiations demonstrate that the agreement was still in effect.
KAR and Taplin came to terms in early July and prepared a contract, but Taplin’s representative, attorney Martin Kalb, never signed it.
“After we have a deal done on a Thursday afternoon, all of a sudden Marty Kalb called me on Monday morning and said he got an unsolicited offer Friday afternoon and he was going with that,” Karmely said. “Yeah, right. They took our offer and used it drum up something better. … They double-crossed us. When you have a deal with someone, it’s done. I want to make a point of that, and I want the property.”
Kalb, a lawyer at Greenberg Traurig, said in an email that he had no comment.
Karmely also showed the Miami Herald text messages he exchanged with Sazant after finding out their deal had fallen through.
“Seriously?” Karmely wrote.
“What choice?” Sazant responded. “$10MM more.”
What choice? $10MM more.
Neil Sazant in a text-message exchange with Shahab Karmely
“That’s like if my wife catches me in bed with a 22-year-old and I say, ‘But honey, she’s so beautiful,’ ” Karmely exclaimed to a reporter.
Sazant did not return phone calls.
The land in question could net big returns.
Zoning on the site would allow for the construction of a 48-story tower with office space, hotel suites, condos, shops and restaurants. Karmely said he envisioned developing a mixed-use space, with the emphasis on either condos or offices.
The building is located just off the water near a Metromover station and the Four Seasons Miami Hotel. Current tenants include BankUnited, along with several law and financial firms.
Karmely’s accusations echo a controversy over the Taplin family’s Sagamore Hotel.
Marty Taplin, a lawyer, developer, art collector and philanthropist, bought the hotel in the late 1990s, along with his wife, Christine, known as Cricket. The couple turned the Sagamore into an Art Basel hotspot. But the beachfront property struggled during the financial crisis and had been under threat of foreclosure for years.
Facing financial catastrophe, Taplin’s company negotiated two different sales: a $70 million deal with New York-based Merchants Hospitality and a later $63 million deal with InSite Group of Fort Lauderdale.
A battle over the sale seemed headed to court, according to a report in the Real Deal, but Taplin’s estate approved the $63 million deal with InSite in April.
A spokeswoman for Merchants said it was bought out of its contract by InSite that but the terms were confidential and she couldn’t comment further. An InSite executive wasn’t available for an interview.
“The matter has been resolved to our mutual satisfaction, and we look forward to working together in the future,” Merchants CEO Abraham Merchant said in an April statement.
The offer from Merchants was higher but would have seen Taplin’s family replaced as the hotel’s management, the Real Deal reported. The other agreement allowed the current team to stay in place.
But all of that was after Taplin fell to his death from a 25th-floor condo at the Bal Harbour Towers on March 8.
At the time, former Bal Harbour Police Chief Mark Overton said that “because of the fact that he was standing on the balcony by himself and he was having personal problems, it’s probably suicide.”
The Miami-Dade Police Department investigated Taplin’s death. Det. Michelle Mullen said a county medical examiner performed an autopsy on March 9 and found that it had been a suicide.