$50M sale mark end of killer’s real estate era, opportunity for others


Palm Beach real estate mogul Fred Keller killed his estranged wife and wounded his brother-in-law in 2003.

When Keller died in prison in 2007, he left behind his young son, Fredchen — and a wealth of commercial property in central and northern Palm Beach County.

Now, 13 years after Keller’s crime, the last of his estate has sold, marking the end of the Keller era in the county’s real estate circles.

In October, an affiliate of New Jersey-based Silverman Group quietly bought 38 properties totaling 915,000 square feet on 54 acres, said Robert Smith, executive vice president of CBRE .

The price was $50 million.

Silverman already is marketing the properties individually for resale, creating a unique opportunity for tenants seeking warehouse space in a tight market.

The sale puts into play properties that have not been available to buyers for decades. That’s because when Keller was alive, he never sold properties, and since his death, his estate has been locked in litigation.

Many of the properties are occupied by tenants that would like to buy their space, said Smith, who handled the Keller sale, together with brokers from CBRE’s institutional group.

Smith now is charged with reselling the properties. Asking prices for industrial space is near peak levels, ranging from about $90 to $100 a square foot, Smith said.

The portfolio includes 38 buildings in West Palm Beach, Riviera Beach, Lake Park and Mangonia Park.

Properties include four buildings at Garden Industral Park in Riviera Beach and two buildings at Gardens Business Center in West Palm Beach.

All are occupied, providing space to more than 230 tenants, Smith said. Tenants vary but many include real estate subcontractors, such as those in the millwork or marble and granite businesses, Smith said.

The fact that all the warehouses are full isn’t surprising, due to low vacancy rates for industrial space in Palm Beach County, now under 4 percent.

“We’ve had a ton of activity from users who want to buy these buildings,” Smith said. “It’s a great opportunity.”

With Small Business Administration help and low-interest loans, “a lot of people don’t want to lease. They want to own,” Smith said.

The $50 million sale to Silverman is half the price pegged for Keller’s portfolio back in 2008, when it first was marketed for nearly $100 million. At the time, the portfolio included a few more buildings.

But a sale didn’t take place because the market was tanking and offers came in low, Smith said.

If the sale of the Keller properties is good news for potential owners, it also marks the end of a sordid period in Palm Beach County history.

Keller arrived in Palm Beach County in 1957. Over time, he amassed a large commercial real estate portfolio, estimated to be worth $60 million.

Although he achieved the financial largess he always wanted, his personal life was far from successful, marked by his often vicious treatment of family members.

He kidnapped his three eldest sons when they were children and for nine years made them believe their mother was dead. Punishments included making a son drink out of a dog bowl or holding a boy’s head underwater until he thought he would drown.

Keller’s marriage to his fifth wife, Rosemarie, ended in divorce the way his previous marriages had. Rosemarie Keller said Fred was mentally cruel to her and their son.

On Nov. 10, 2003, 11 days after a judge in their divorce case gave Rosemarie 50 percent of Keller’s estate, Keller shot and killed Rosemarie at his Riviera Beach office.

Keller also shot and wounded her brother, Wolfgang Keil. Fred and Rosemarie’s young son, then 8, went to live with an aunt.

Fred Keller was sentenced to two life terms in April 2007. He died four months later at age 73, after battling leukemia for years.

Lawsuits followed for years over claims to his wealth by relatives and attorneys. The lawsuits eventually were settled.

Alexandra Clough writes about the economy, real estate and the law.



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