The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

FTX’s $256m Bahamian property empire is set to “hit the market within the next 30 days” after five to seven local realtors were selected to handle their disposal.

Realtors spoken to by Tribune Business said the high-end international market for Bahamian real estate is more than capable of absorbing the one-time influx of 34 properties purchased by the collapsed crypto exchange, one going so far as to describe their impending listing-for-sale as a “drop in the bucket”.

All confirmed that FTX’s Bahamian liquidators, chiefly the PricewaterhouseCoopers (PwC) accounting duo of Kevin Cambridge and Peter Greaves, have recently started issuing confirmations to the Bahamian realtors selected to list, market and sell properties that represent a significant source of recovery for investors and creditors.

This newspaper understands that the high-end residential and commercial properties have been split-up between as many as five to seven realtors as the Bahamian liquidators seek to maximise the sales prices for the benefit of creditors and also to fulfill the terms of their agreement with John Ray, FTX’s US chief who heads the 134 entities currently in Chapter 11 bankruptcy protection in Delaware.

Matthew Marco, marketing director and licensed realtor with Bond Bahamas,

voiced optimism that the high-end market will have no difficulty dealing with an FTX-led surge in inventory as he confirmed the company is among those selected to sell those properties.

“I seriously think it’s a drop in the bucket. Everybody will forget about this in a few years,” he said of the FTX properties. “There’s more than enough people to buy this inventory at full asking price. There’s no discounting at all. We have a handful of listings that will go on the market within two weeks.”

Asserting that “it doesn’t take a lot to move the needle here”, Mr Marco cited as an example the 70,000 wealthy individuals and families potentially looking for new homes and jurisdictions as a result of the UK’s upcoming changes to non-domicile tax laws and rules next year.

“If 0.1 percent decide they want to move to The Bahamas that’s 70 families,” he explained. “There’s not 70 properties here for them. We’re not Miami, New York or Toronto where you need thousands of people. You only need a handful of people to move the needle. That’s all it takes.”

Mario Carey, founder of Better Homes & Gardens Real Estate MCR Group, told this newspaper that disposing of the FTX properties will be more complex than a traditional real estate sale since the Bahamian liquidators are answerable to the Supreme Court and have a fiduciary duty to creditors to achieve the best possibly sales price.

“The process has been advanced. They’re moving in that direction where they went out to prime brokers,” Mr Carey said of the liquidators’ selection process that began in mid-February 2024. “I guess the properties will hit the market in the next 30 days.

“There are many things that we have to pay attention to. You’re going to get a lot of bottom feeders who think they can come in and get discounts. You will have property owners in some some communities who feel that deals will be cut that will devalue their properties.

“I think the market will absorb them without any issues because the demand is still strong. You will find wealthy owners will probably come into the market to protect themselves and protect their flock. If a guy can afford a $20m condo, he will come into the market and buy these assets. They can donate them to their children. It’s going to be an interesting end result. We’ve never seen this before - $270m of inventory hitting the market.”

David Morley, Morley Realty’s principal, made a similar prediction. “Two days ago we got an e-mail from the liquidators indicating they have selected us to represent them on one of the commercial properties,” he told Tribune Business. “We did not get everything we bid for.

“There was one of the Pineapple House properties, and the acreage at Blake Road and West Bay Street where they were going to build the headquarters. We also bid on Veridian Corporate Centre, and we were selected for Veridian Corporate Centre. Now we have to move forward trying to meet with them [the liquidators]. They want to see our terms of engagement and everything is subject to contract.

“It looks like they are moving forward, making decisions. We’ll see marketing of those assets very shortly. I would anticipate that, within two to three weeks, you will see marketing of those assets. There’s still work that has to be done in advance of marketing them.” This, Mr Morley said, included realtors completing listing agreements with FTX’s Bahamian liquidators.

“I think it’s going to help,” he added of the inventory influx. “There are people in the market waiting to possibly pounce on those assets, thinking they can pick them up for pennies on the dollar, when the liquidators have to prove to the court they’ve achieved the best possible price.

“For the residential stuff and the high-end side it’s going to help the market in adding inventory back to it. On the commercial side, I’m not that ambitious about it. I don’t think there’s as much demand on the commercial side as there clearly is on the residential side. At least we’re one step closer. The wait is almost over. Now we have some work to do.”

Another high-end realtor, speaking on condition of anonymity, agreed. “They are now appointing the agents for the FTX properties. It’s getting done. They’re getting close. I’m happy they are. It looks like I have a lot of work ahead of me,” he added.

The Bahamian liquidators, in launching their request for “expressions of interest” from Bahamian realtors in mid-February, confirmed that a total 34 properties are being readied for sale. Of this number, close to half - 16 - are located in the high-end Albany community in south-western New Providence, featuring a number of three to seven-bedroom condos and one separate residential dwellings.

Of the remainder, eight are one-two bed condos located in the GoldWynn development on Goodman’s Bay, while another four units are in the One Cable Beach complex on Cable Beach. The final six properties include the Ocean Terrace gated residential condo building, with 16 units and leisure facilities, on West Bay Street, plus two residences in Old Fort Bay.

The balance consist of commercial real estate, including the 4,000 square foot Pineapple House; FTX’s former Bahamian head office at the Veridian Corporate Centre on Western Road; and undeveloped land on West Bay Street and Blake Road.

The 16 properties at Albany, 15 of which are condominiums, were bought at price points between $4.75m and $30m. The seven units acquired in the GoldWynn project at Goodman’s Bay were valued between $563,520 and $1.449m.

Four units, varying in value from $975,000 to $1.54m, were purchased in the One Cable Beach project. Some $26.34m was spent on acquiring multiple units at the Veridian Corporate Centre, with further outlays of $17.435m, $9m and $1.8m on property at Ocean Terrace, Old Fort Bay and Pineapple House respectively.

Under the terms of the Bahamian liquidators’ agreement with Mr Ray, all 34 properties must fetch a price that is “equal to or greater than 80 percent” of their broker-appraised values. The deal stipulates that “the aggregate sale price with respect to each Bahamas property sold pursuant to the sale is equal to or greater than 80 percent of the price stated in a broker price opinion produced by a real estate broker licensed in The Bahamas”.