By Michael Stern’s account, everything is going great.
The developer behind Walker Tower in Manhattan, the Brooklyn Tower and Mercedes-Benz Places in Miami spoke at The Real Deal’s Miami Real Estate Forum on Wednesday, as he battles lawsuits from investors and lenders, as well as foreclosure threats. TRD’s August cover story, which depicted Stern hanging off a building, documented these challenges.
But Stern, founder of JDS Development Group, said he is close to finalizing a $1.1 billion financing package for Mercedes-Benz Places, a nearly 800-unit, two-tower condo development in Brickell. Stern said Jeffrey Soffer’s Fontainebleau Development will come in as a partner.
The financing, led by JPMorgan, would allow construction to resume after the project’s lender, Cottonwood Group, filed a foreclosure lawsuit in April. If it closes, it would be the largest construction financing in Florida history, surpassing an $817 million loan Tyko Capital provided for Faena Residences Miami last month.
Stern said JDS will hold the majority of the equity in the deal.
“Jeff is coming in and is the driving force behind that financing vehicle,” Stern said of Soffer. “Jeff will have vast say over anything that has to do with that financing.”
Last month, Newmark put the Dolce & Gabbana-branded condo project at 888 Brickell Avenue on the market though a source said JDS was looking for a minority partner. At the forum, Stern said he has lined up a commitment from an equity partner.
“We’re out to raise the last little piece of equity to get the construction loan closed,” Stern said. “We have a commitment for the construction loan.”
Stern said he expects to close on about a $640 million construction loan by the end of the year.
New partners or record-breaking construction loans may salvage Stern’s Miami projects, but they won’t end his legal problems.
Earlier this year, One Sotheby’s International Realty sued a JDS affiliate, seeking more than $500,000 in allegedly unpaid commissions on sales at the Dolce & Gabbana-branded tower. Stern described the dispute as a “small bid-ask spread.” While declining to comment on specific litigation, he said there are “questions about draws.”
“We have nothing but respect for the One Sotheby’s team, and we expect to continue to do business with them in the market, across the market,” Stern said.
In 2024, the developer handed the keys to his marquee Brooklyn project, the Brooklyn Tower, to Silverstein. Silverstein Capital Partners later brought an arbitration against Stern and JDS. Arbitrator Eugene Farber issued a $46.9 million award against them, finding that Stern concealed from the lender a $35.4 million insurance payout tied to a 2022 burst water pipe. Stern argued in the arbitration that it was an “obvious fact” that a developer could keep some of the insurance proceeds to cover the project’s “soft costs.”
Stern is also fighting his former partner, Italian investor and entrepreneur Gianluca Vacchi. In a lawsuit filed this summer, Vacchi claims Stern agreed to pay his entities $42.5 million under a settlement, and he is seeking to have Stern removed from the Mercedes-Benz project. (A spokesperson for JDS has previously called the lawsuit a baseless publicity stunt and extortion).
Stern’s JDS persuaded the city of Miami Beach in 2025 to approve an overlay zoning district that allows a 330-foot high-rise at 1250 West Avenue. Stern transferred his interest in the planned 28-story, 106-unit building to David Martin’s Terra last year. The project secured a $507 million construction loan from Tyko Capital in October.
When TRD Founder and Publisher Amir Korangy asked Stern how he felt about Terra keeping the partners he had brought into the project, Stern said, “It was the deal I contemplated.”
“We wish those guys luck. David’s a great developer,” he said. “He’s going to build a great building using the zoning that we put there, and we’re super happy about it.”
Read more
Soffer to the rescue? JDS working on securing partner, $1B loan for Mercedes-Benz Miami project
Michael Stern’s projects flash signs of distress, but risk-taking developer has come back from crises and chaos before
