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North End oceanfront Krause trust property sells for $16.8 million

Posted On: 08-03-2011

 

By Darrell Hofheinz

Daily News Real Estate Writer

Posted: 3:54 p.m. Wednesday, Aug. 3, 2011

 

With the stroke of a pen on a deed, Palm Beach has gained a new double lot with nearly 240 feet of direct ocean frontage.

The same trust that in May paid about $12.1 million for a seaside property on the North End has acquired the house next door at 1071 N. Ocean Blvd. for about $16.89 million, the price recorded Monday on the trustee’s deed.

Alan M. and Karen Krause sold the six-bedroom, Bermuda-style house through the Karen L. Krause 2005 Residence Trust, according to the deed, dated July 29 and filed with the Palm Beach County Clerk’s office.

Broker Lawrence Moens of Lawrence A. Moens Associates had listed the house for sale at $21 million. Broker Christian Angle of Christian Angle Real Estate represented the buyer, listed on the deed as the 1071 North Ocean Boulevard Trust.

If taken together as a single transaction, the sale of the two properties would total about $28.9 million. That would constitute the second-largest Palm Beach residential real estate transaction by a single buyer this year, just short of the $29.15 million fetched by a home at 40 Blossom Way in May. Moens was also involved in that deal, representing the buyer, while Cristina Condon of Sotheby’s International Realty acted on behalf of the seller.

Reached Tuesday by telephone in Paris, Moens said “a lovely young family” was associated with the trust that bought the house and the adjacent property at 1071 N. Ocean Blvd., where a 1950s-era home was recently demolished.

Moens declined to give any other details about the family or the transaction. Angle, who like Moens was involved in both of the North Ocean Boulevard deals, also would not comment on the sale.

Built in 1998, the house just sold stands on the east side of North Ocean Boulevard between Orange Grove and List roads, nine blocks north of the Palm Beach Country Club. With a total living space of 12,700 square feet, inside and out, the property has a four-car garage, a one-bedroom staff apartment, a lanai, a swimming pool and a whirlpool spa among its features, according to the sales listing.

It remains unclear whether the buyer of the two properties plans to demolish the existing house and build another home on the newly created double lot. An alternative might be to expand the existing house onto the adjacent property or to build separate structures or amenities there. As with all residential construction projects, any plans would have to receive the town’s approval.

The parcel that sold in May measures about three-quarters of an acre and boasts 117 feet of oceanfront. It was sold by the Janina Radtke Revocable Trust, named for the wife of Euro Homes builder Zack Ciomek, who at one point had planned to develop a house there.

The property that just sold is a little larger and has 122 feet of oceanfront.

In addition to having homesteaded their Palm Beach house, the Krauses own another home in Lyndhurst, a suburb of Cleveland, Ohio.

Internet sources show that 1070 N. Ocean Blvd. had been the Krauses’ residence since June 2001, when it was purchased for $10 million by an entity called the La Casita Trust. In September 2005, a trustee’s deed transferred ownership to another trust in Karen Krause’s name. Deeds for both transactions list attorney Samuel S. Pearlman of Cleveland as trustee of the trusts involved. Pearlman has been involved with Alan Kraus in other business transactions, public records show.

The ownership of the house was transferred a few months after Alan Krause was charged, in June 2005, with cheating on his personal federal income taxes and misleading investigators. The charges were related to his ownership of Mid-America Management Co. of Ohio, which owned and operated apartment buildings, warehouses and office buildings across the country.

In January 2006 at age 77, he was sentenced to a 16-month prison term for tax fraud. Investigators said Krause had falsely claimed business losses and depreciation for the years 1998 through 2000, realizing about $545,000 in tax savings. He later repaid that money, according to the Plain Dealer of Cleveland, which covered the case.

Prosecutors said Krause had used a limited liability company to fund a major renovation project at his Ohio home but devised a scheme with his accountant to falsely report the expenditures as business-related. The scheme, in effect, illegally reduced the amount of Krause’s 1998 taxable income, prosecutors charged.

The Krause family has been noted for its philanthropy, which has included major contributions to the Cleveland Clinic, among other organizations, many in the Cleveland area.

 

Source: Darrell Hofheinz, August 3, 2011, Palm Beach Daily News

http://www.palmbeachdailynews.com/news/north-end-oceanfront-krause-trust-property-sells-for-1690461.html

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