Boca developer has grand plan for West Palm Beach land near Northwood


Highlights

Mario Caprini is battling two lawsuits but he said they don’t affect his plans for homes and offices in WPB

Offices, a grocery store and “micro-condominiums” might soon rise out of the ground on a prime piece of land in West Palm Beach west of Northwood Village.

These are the first projects that Boca Raton-developer Mario Caprini wants to build as part of an ambitious $70 million complex dubbed Northwood Commons, on a 3.5-acre parcel owned by the West Palm Beach Community Redevelopment Agency.

Can Caprini get the job done?

His company’s website lists his prior development work in Canada and Ohio, including 1,000 residential units, 5 million square feet of industrial parks and “hundreds of thousands” of square feet of office, retail and medical buildings.

In South Florida, Caprini recently completed construction of a “green” home in Pompano Beach at 4620 N.W. 18th Ave.

The project, dubbed Modernista, was recognized by the mayor of Pompano Beach in March and won a national award in February from the Structural Insulated Panel Association, earning first place in the affordable housing category.

But Modernista also is the subject of ongoing litigation with Caprini’s investment partners, who allege civil theft and fraud by Caprini; his partner in the deal, Eddy Sua; and their company, Capital Group Developments LLC.

Caprini said his partners in the project “didn’t live up to their end of the bargain and spread some disinformation, so we took action.” He sued them.

Caprini said the Pompano Beach lawsuit, and another lawsuit involving a property in Northwood, were disclosed in his application to develop the CRA land.

Caprini said he’s not worried about the Pompano Beach lawsuit: “We’re enthusiastic, positive, honest people,” Caprini said.

In fact, Caprini is very enthusiastic about Northwood, which he believes is about to pop.

He could be right. A new apartment, 312 Northwood , is open and attracting tenants; a new restaurant, Hutton , is set to open Aug. 22 at 407 Northwood Road; and investors are pouring money into the area, even as Palm Beach investor Jeff Greene continues work to develop his properties to the east of Northwood, around Currie Park.

Caprini wants to build five separate complexes, starting with Building A, on the CRA site. The property is on the west side of Northwood Village, from 23rd Street to the south to 25th Street on the north, mostly west of Broadway.

Building A will be an eight-story structure featuring 325 parking spaces, 60,000 square feet of office space and downstairs, a 35,000-square foot space for an urban grocer. Caprini also hopes to build a Tri-Rail train station to connect to this complex.

Building A also will have 73 small condominiums, which he calls “micro-condominiums,” that he estimates would sell for about $165,000 each, suitable for millennials, retirees or out-of-town buyers who want a small but affordable home in West Palm Beach, Caprini said.

Overall, Northwood Commons will consist of 201 residents, 86,000-square feet of office space and 70,000 square feet of retail space. Residences also will include workforce housing apartments and market rate rentals. One building will feature incubator and shared workspace, a rooftop terrace with bar or restaurant and a permanent stage for entertainment. Parking also is a big part of the project, and Caprini plans to build two parking decks totaling 580 spaces.

Caprini said his goal is to incorporate popular construction design elements into an affordable project that can be done quickly.

His partner in the deal is Tony Brown, formerly executive director of the Riviera Beach CRA. Brown said he’s in charge of obtaining financing and has a commitment from 5th Third Bank for Building A. The financing will make use of new markets tax credits, Brown said.

Brown said whatever litigation is taking place in Pompano Beach has nothing to do with him or TBCG Capital Group, of which he is a 50 percent partner.

“My credit is clean. I’ve not been involved in any litigation,” Brown said.

On June 5, the CRA board approved the staff’s recommendation that TBCG build on the CRA-owned anchor site, which TBCG wants to lease. Negotiations on a development agreement are ongoing, CRA director Jon Ward said.

While Caprini irons out details with the CRA, his lawyers are working to litigate the lawsuit with the Modernista investors.

Last December, Caprini filed a lawsuit in Palm Beach County Circuit Court against investors CDA LLC, Luis Summers and Rebecca Turley-Summers. The complaint alleges the investors provided only $40,000 of $50,000 pledged to Modernista, causing the project delays and fines from the city.

The lawsuit also accuses the investors of defamation, alleging they engaged in a “smear campaign” to slander their business reputation.

The lawsuit cites an email sent by Turley-Summers to Pompano Beach city inspector Salvatore Reginello: “I have learned that both Mario and Eddy are insolvent. I believe they have used my funds, and likely the city’s funds, to pay their personal expenses and their expenses in unrelated projects where they could not meet their obligations. The bills at Modernista have not been paid….”

The lawsuit has grown complicated. The investors have countersued Caprini, Sua and Capital Group for civil theft, fraud and breach of contract.

In a June 6 filing, they claim Caprini and Sua diverted $10,000 of their money to a different project, refused to let them perform an accounting of the Modernista job and used unlicensed contractors “who performed substandard work and didn’t obtain permits.”

Caprini said after he filed the lawsuit, Pompano Beach city officials were made aware of it, and “the city gave us two more contracts.”

There’s another ongoing lawsuit against Caprini, this one involving a property in Northwood.

In April 2016, Global Business Financial Investments, Global Real Estate Holdings and Armando Rivas sued Caprini, Sua, CGR Investments and 3600 Broadway LLC (owned by Caprini and Sua) in Palm Beach County Circuit Court. The plaintiffs allege breach of contract and civil theft on a commercial building at 3600 Broadway.

CGR bought the property on March 24, 2015, for $326,000 and that same day flipped it to 3600 Broadway LLC for $550,000.

In an August 2016 amended complaint, Global and Rivas allege they are owed $37,800, which includes a funding fee, loan and other costs. The lawsuit is ongoing.

But the property is gone.

The month prior, on July 29, 2016, the property’s lender, Hersab Holdings, sued 3600 Broadway LLC, Caprini and Rivas to foreclose on a $330,000 note on the building.

The property was sold in a foreclosure sale to Hersab on May 1. Caprini characterized the sale as a “friendly foreclosure.”

“But we are still managing the property, and as soon as it’s back up for sale, we’re buying it right back,” Caprini said.

As for the Global/Rivas lawsuit, Caprini said the lawsuit will be dismissed soon.

Caprini expressed a fondness for the 3600 Broadway building, even though it resulted in litigation, because it made him aware just how much promise Northwood holds.

Caprini said his planned developments on the CRA anchor site will be “a game changer … We want to keep the price tags low so we can respond to the workforce,” he said. “That’s the goal.”

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



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