Vulture not ashamed of picking real estate bones By Mary Umberger Chicago Tribune 11-01-2009

Vulture not ashamed of picking real estate bones
By Mary Umberger
Chicago Tribune
November 1, 2009

Peter Zalewski is a vulture.

He's not shy about it either: He named his Miami brokerage Condo Vultures Realty when he formed it in 2006, specifically to help bargain hunters sift through the carcasses left behind when South Florida's real estate market crashed.

He's gotten some media attention for his willingness to tread (or should that be "fly"?) where others flinch, including an appearance in December on "60 Minutes" talking about the meltdown in Miami.

And now he's in the movies, playing himself in Michael Moore's documentary "Capitalism: A Love Story." The movie, an indictment of greed, puts Moore's signature spin on the behavior of Wall Street, the banking industry, privatized social services and numerous other entities, but it spends a fair amount of time taking a whack at real estate and the foreclosure mess.

"What's the difference between you and a real vulture?" an interviewer asks Zalewski in the movie.

"I don't vomit on myself," he replies, with a grin.

In the film, Zalewski makes a fairly brief appearance, escorting a camera crew to foreclosed properties that his clients hope to buy at a huge discount and explaining to the camera, "This is straight-up capitalism."

But he says he didn't realize at the time that his comments would end up in Moore's documentary.

"I knew I was being filmed," says Zalewski, who grew up in Chicago and graduated from Gordon Tech High School. "I was approached in May by a company saying, 'We're an independent film company working on a documentary about the economy, and we wonder if you could talk about Florida real estate.' "

So he spent a day with them.

"At no time did I know it was a Michael Moore movie," he said. "Later, I got a call from a guy I know in Frankfurt, Germany, who had seen the trailer for the movie and called me. That was the first I knew."

He's not complaining.

"Michael Moore can say whatever he wants about us. At the end of the day, when we pack up the tents, I'll give Michael a call and ask him if he wants me to donate to a charity," he says. "He's helped put a lot of money in my pocket."

Zalewski these days oversees a stable of 36 agents at Condo Vultures Realty. Two-thirds of them work with individual buyers in South Florida, but 13 specifically handle "bulk sales" to investors who are buying large numbers of units in the area. (The company has opened offices in Las Vegas and San Diego, with plans to expand to Los Angeles and Phoenix.)

Though Florida, in general, went on a building binge during the housing boom, Miami became the national poster child of excess. In late October, he said, about 70,000 condos were for sale, and though that's an extraordinary number, it's down from the 108,000 listed last year at Thanksgiving.

Buyers are definitely out there, he says, and he and his agents are putting in long days with them. He says 60 percent to 70 percent are investors or second-home buyers; the rest are "primary users" who will occupy them full time.

At the height of the boom, condo buying in Miami was frenzied. Buyers stood in long lines to put down deposits on not-yet-constructed buildings; some hired people to do it for them.

The frenzy is back, sort of, Zalewski says. Most prominent are foreign investors trying to take advantage of the weak dollar. These buyers, he says, are paying premium prices.

"A (bank-owned) property will come to the market on Friday, and on Monday, when the bank starts to collect offers, they might collect 10 or 20, and they can be 10 or 20 percent higher than the asking price," Zalewski said.

So, is the Miami market headed for another bubble?

"I wouldn't say we're not," he said. "The only difference in today's Miami condo market, compared to (the market peak) in 2005, is that today's buyer is all cash, no leverage.

"In 2005, it was all leverage, no cash. But it has the same feel, the same irrational exuberance."

Zalewski says the pace at his Bal Harbour-based business these days is nonstop. He knows that both within and outside real estate, some are scornful of his specialty.

"There's a hero and a villain in every story. We don't have any trouble being the villain in some people's eyes because we're the hero in someone else's. It just depends on which side of the table you're sitting on at the closing," he says.

"We're going to do what we do as long as we're doing everything legally and ethically. We're not being charlatans.

"Vultures haven't been put on Earth without a good reason."