Real Estate News

The robotic garage at this Brickell condo broke. Now the developer must pay $40.6 million.

The elevator entrance bays at the robotic parking garage at the BrickellHouse condominium. The garage was shut down in Nov. 2015, leaving residents with no place to park.
The elevator entrance bays at the robotic parking garage at the BrickellHouse condominium. The garage was shut down in Nov. 2015, leaving residents with no place to park. Photo courtesy Siegfried Rivera

The developer of the 46-story BrickellHouse condominium tower in Miami that made news in 2015 over its failed robotic parking garage has been ordered to pay $40.6 million in reparations to the condo association that dealt with the aftermath of the debacle.

The jury verdict, which was reached in Miami-Dade Circuit Court on Aug. 30, found that developer BrickellHouse Holding LLC, a subsidiary of the Newgard Development Group, breached statutory warranties owed to the building’s condo association and its unit owners.

The ruling comes four years after the building’s parking garage — a high-tech, $16 million robotic system designed to retrieve cars in under 10 minutes — was shuttered, leaving residents with no place to park their vehicles.

Since then, the BrickellHouse condo association has been forced to secure off-site parking for the building’s tenants. often relying on month-to-month tenancies and valet parking, according to Helio De La Torre of the law firm Siegfried Rivera, which represented the association. The lawsuit was filed in April 2016.

“This was a long and difficult process for the association and its owners,” said Ginna Rojas, association board member and representative. “It is unfortunate we had to take the developer to court to resolve this problem. We have waited four years for our day in court. The BrickellHouse community appreciates the jury’s decision, and we look forward to getting the garage the owners were promised.”

The money will be used to remove the broken robotic system, repair the garage, install new mechanical plumbing and retrofit the garage, according to De La Torre.

“We have to fix the damage caused by the robots,” he said.

The garage was designed to allow tenants to swipe a card or fob at one of the computer terminals located in front of five entrance bays. The computer would locate the owner’s automobile and deliver it to the owner using a robotic lift.

But the garage, which was prone to mechanical glitches and delays since it became operational, was closed in Nov. 2015, one month after the developer turned over control of the condo association to its current board members.

Boomerang, the New Jersey-based company contracted to build and operate the garage, pulled out of its contract in January 2016 after declaring bankruptcy.

The developer also oversold spaces in the garage to tenants, who were allowed to buy an extra spot for $40,000. A total of 530 spaces were sold, even though the garage had a capacity of 480 spaces, according to Lindsay Thurswell Lehr.

The 374-unit tower, located at 1300 Brickell Bay Drive, was finished in October 2014 and was one of the first condo buildings completed after the recession. The average sales price of a unit was $456,000, with some penthouses fetching as much as $2.1 million. The average square-foot sales price was $574.

There are currently 44 units listed for sale in the building at an average square-foot price of $587.50. The listed units have been on the market for a total average of 399 days.

In an interview with the Herald in April 2015, Harvey Hernandez, the co-founder and CEO of Newgard, said the robotic garage brought added attention to the project.

“It gave us great exposure during sales,” Hernandez said. “A lot of buyers said the parking was a great attraction.”

Hernandez had already agreed to pay $275,000 to settle the association’s lawsuit against him, according to the South Florida Business Journal. The association had also been awarded a $32 million payment in March by the company that insured Boomerang.

Ron Lowy, the attorney who represented the developer in the lawsuit, told the South Florida Business Journal that the jury was not informed of that previous payment and is confident the court of appeals will rectify this error.”

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Rene Rodriguez has worked at the Miami Herald in a variety of roles since 1989. He currently writes for the business desk covering real estate and the city’s affordability crisis.