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<\/p>\nLuxury condos\u00a0donning the names of world-renowned brands are taking over South Florida, but the buyers\u00a0who have spent millions of dollars to fill them are starting to see the cracks \u2014 literally.<\/p>\n
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\n Bisnow\/Chloe Gallivan\n <\/p>\n
\n The Aston Martin-branded residences, a new condo tower in Miami where buyers have sued the developer, alleging shoddy construction\n <\/p>\n
In the first five months of 2026, the condo associations of three newly built luxury\u00a0Miami residential towers\u00a0have sued their buildings’ developers and\u00a0contractors over defects like cracks in concrete, roofing failures that cause water intrusion and using\u00a0cheaper materials than they were promised.<\/p>\n
\u201cIt’s what I would call a vicious cycle that doesn’t end,\u201d Haber Law founder and lawyer David Haber said.<\/p>\n
That outcome is becoming increasingly common for new high-rises in South Florida, which insurance experts have said is ground zero for the surge of lawsuits driving up liability insurance rates<\/a>.\u00a0<\/p>\n Developers say the spike in lawsuits is being driven by the trial lawyer industry, which has\u00a0spent millions<\/a>\u00a0nationwide on advertisements and aggressively expanded its headcount<\/a>. Florida, one of the states with the\u00a0highest concentrations of lawyers<\/a>, is a hot spot.<\/p>\n \u201cThere is a cottage industry there of law firms that are mainly based in South Florida, but they handle cases all over the country,\u201d Time Equities Director of Risk Management Aron Sotnikoff said. \u201cIt’s largely \u2014 I hesitate to call it a scam, but it is somewhat like that.\u201d<\/p>\n Between 2022 and 2024, national federal tort cases, mostly including slip-and-fall accidents, elevator and escalator accidents, toxic exposure and wrongful deaths due to negligence, increased by 20%, Risk & Insurance reported<\/a>.<\/p>\n But Florida has Chapter 558 of the Florida Statutes, a state law that allows a condominium association of a newly constructed building to inspect the property for construction defects and request repairs.\u00a0<\/p>\n The rule lays out the\u00a0prelawsuit process that requires property owners to notify developers and contractors of construction defects to provide an opportunity\u00a0for them to\u00a0inspect and repair before a lawsuit is filed.<\/p>\n \n Miami-Dade Circuit Court\n <\/p>\n \n A photo of eroding concrete in a garage filed in a lawsuit by the condo association of the St. Regis Bal Harbour against the condo-hotel’s owner\n <\/p>\n Meant to deter disputes by giving developers and contractors a chance to fix defects before a suit is filed, the rule has had the opposite effect.<\/p>\n So far this year, associations of the Aston Martin Residences<\/a>, the Missoni Baia Residences and the Amrit Ocean Resort, which represent nearly 1,000 units, have all filed lawsuits after going through the Chapter 558 process.<\/p>\n Haber represents the associations of the Aston Martin Residences and Amrit and said virtually all of the high-rise condos that go up enter the process and result in a lawsuit.<\/p>\n \u201cThey end up having to go through years of litigation before they get settled,\u201d Haber said. \u201cMaybe one out of 100 developers say, \u2018I’m fixing it, I’m going to do it myself, I’ll go after the contractor, don’t you worry, I’m\u00a0going to\u00a0stand behind my product.\u2019\u201d<\/p>\n In May, Haber’s firm filed a suit over construction defects at the Amrit Ocean Resort on Singer Island against the developer, an affiliate of Dilip Barot’s Creative Choice Group, after a rain event exposed construction failures.<\/p>\n The suit, filed two weeks after the association was handed over to the owners, alleged roofing failures that caused water intrusion, corrosion affecting air conditioning, plumbing, electrical and fire sprinkler systems, and cracking in stucco and deteriorating concrete, The Real Deal reported<\/a>.<\/p>\n Owners began the Chapter 558 last year at the building, where two-bedroom units are listed for more than $2M<\/a>.\u00a0<\/p>\n The dispute is among a host of legal issues the\u00a0developer is facing over the project, including an investigation by the Riviera Beach Police Department over claims the buyers were misled to believe their units qualified for the Florida homestead tax exemption,\u00a0TRD reported<\/a>.<\/p>\n Chapter 558 claims are part of the reason for-sale construction liability insurance premiums tend to be four to five times higher than the cost of insuring construction on a multifamily project,\u00a0Lockton Cos<\/a>. Senior Vice President Jonathan Perrillo said at\u00a0Bisnow’s\u00a0Condoverse conference in April.<\/p>\n And for those that may have come to Florida because of its business-friendly policies, it is becoming harder to ignore.<\/p>\n \u201cTalking about 558 claims with the condo associations and what have you \u2014 we wanted to get the hell out of New York because of the cost of insurance and what that did to development projects,\u201d Rinaldi Group President and CEO Anthony Rinaldi<\/a> said\u00a0at the event in April. \u201cWe’re starting to run into that [in South Florida].\u201d<\/p>\n \n The Missoni Baia condo tower at 777 NE 26th Terrace in Miami’s Edgewater neighborhood\n <\/p>\n The reason lawsuits drive insurance premiums up, Haber argued, is that instead of fixing the defects when the 558 claims are filed before the lawsuit, developers allow disputes to go to court, where their insurance will cover the payout.<\/p>\n And sometimes the insurers need a little nudge.<\/p>\n Vlad Doronin<\/a>‘s OKO Group<\/a>, after being sued in February<\/a> by the association of the Missoni Baia tower in Edgewater over alleged construction defects, filed its own suit in April against four different insurers<\/a> for $22M, claiming they only covered some of its losses from construction issues, which totaled more than $55M.<\/p>\n The association claims there are cracks in floor slabs, foundation and columns and water intrusion in units, mechanical rooms, stairwells and the parking garage. OKO claims the building settled unevenly in 2021, two years after construction began, which caused the issues.\u00a0<\/p>\n While the increase in disputes may be contributing to the rise in insurance costs in South Florida, Haber said developers ultimately bear the responsibility and argued that the state should be doing more to hold them accountable.<\/p>\n In April, he filed suit on behalf of the residents of the 341-unit, 66-story Aston Martin tower<\/a>\u00a0against\u00a0the developer, an entity led by Argentine grocery mogul German Coto, and 16 other contractors and subcontractors.<\/p>\n<\/p>\n<\/p>\n