Despite developers facing legal troubles, New Jersey developer Rey Grabato has won site plan approval for his planned 43-story apartment tower, 200 Third, in the Flagler Village area of Fort Lauderdale. The project will consist of a 388-unit multifamily development, with plans for the entire project to be sold rather than built by Grabato’s company. Designed by Humphries & Partners Architects LP, the tower will feature a nine-story parking podium with 34 floors of apartments, with the upper level of the parking podium featuring a swimming pool, lounge, bar, and seating areas.
200 Third: 43-Story Apartment Tower Approved for Flagler Village Despite Developer’s Ponzi Scheme Charges
In addition to the approval from the Fort Lauderdale City Commission, the developer must meet a set of conditions before receiving a building permit. These conditions include payment of a park impact fee, obtaining approval from the Federal Aviation Administration for the development’s height of slightly more than 448 feet, and completing the installation of larger sewer pipes to handle wastewater from 200 Third prior to the issuance of a final certificate of occupancy.
The project site, located at 200-210 Northeast Third Street in Flagler Village, was acquired by Grabato’s company, 3rd Street Capital 200-210 LLC, for $9.8 million in late 2021. This month, the entity paid an additional $9.3 million to acquire multiple parcels at 203-215 Northeast Third Street, directly across from the development site.
Legal Concerns Surround Flagler Village’s 200 Third Despite Site Plan Approval for Rey Grabato’s Multifamily Development
However, Grabato’s legal troubles have caused concern for some in Fort Lauderdale. In October of last year, the US Department of Justice announced charges against Grabato and another man in an 18-count indictment, accusing them of securities fraud, and conspiracy to commit The charges against Grabato and Salzano include allegations of committing fraud related to securities and wire transactions, conspiring to commit wire fraud, and conspiring to defraud the United States. According to the indictment, Grabato and his co-defendant were involved in an alleged $650 million Ponzi scheme, defrauding more than 2,000 investors.
The US Securities and Exchange Commission also announced charges against National Realty Investment Advisors (NRIA) and four former officers of the company, including Grabato, for allegedly running a Ponzi-style scheme on the same day as the DOJ’s announcement. NRIA, based in Secaucus, New Jersey, filed for Chapter 11 bankruptcy in June of last year, listing $50 million to $100 million of assets and $500 million to $1 billion of debt.
Despite the legal troubles surrounding Grabato in Fort Lauderdale and his company, the approval of the site plan for 200 Third suggests that the development will move forward. However, the ongoing legal proceedings will likely continue to be a cause for concern for investors and potential buyers of the development.
