Florida Outlet Mall Facing Foreclosure

When investor Irwin Tauber and his wife first announced they were buying the Vero Fashion Outlets in 2007 for $38.2 million, I thought it was either a scam in the works or Tauber was dumber than a box of rusty nails. It looks like the latter is true, because the note holder on the property just filed a foreclosure lawsuit in Indian River Circuit Court. I could not understand then, and I cannot understand now why so many "formerly" astute businesspeople are chasing deals . . . simply because there are other fools lined up with dumb money chasing similarly dumb deals. Unfortunately, for the very big deals, that dumb money is institutional pension fund money chasing big condo projects and big office projects that have busted out.

I was always told that Outlet Malls would survive. Why? What makes them any different? The same held true when we shorted the publicly traded outlet malls.

In closing, rest assured that the fall out in commercial real estate has not even begun to heat up. The government has done a tremendous job in pumping out money that has been flowing into the commercial vaults, only to be twitted away in losses and huge bonuses. Who's the loser? You, your pension funds and taxpayers that will never see the return on the money pumped into these losing commercial real estate deals . . . from outlet malls to high rise ritzy office towers.

Great Time to Buy Real Estate? - Yes, No, Maybe. I suggest you read this piece I wrote about how to find a Great Buy and what traps to avoid. The piece was written about residential property, but it applicable to the knuckleheads making big condo deals just because they have pension fund money thrown at them - Click Here