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New Lease On Life: Apartment Projects Popping Up At Distressed South Florida Shopping Centers

Residential redevelopment of South Florida shopping centers is becoming more common, amid solid demand for rental housing and a slack market for retail space.

This month, Houston-based developer Morgan Group won a land use change to build 356 apartments on the site of a former Macy’s store and parking lot at Pompano Citi Centre, a shopping center in Pompano Beach on the southwest corner of Copans Road and Federal Highway.

“We haven’t seen many of these residential transformations at commercial centers, but I think you’ll start to see more of them as the centers unfortunately start losing tenants on a permanent basis,” said attorney Neil Schiller, a founder and shareholder of Boca Raton-based Government Law Group who represents real estate developers.

Shopping centers in densely populated areas are among the best in-fill sites for multifamily developments because they can meet the residential, occupational, and recreational needs of residents, said Art Falcone, co-founder and chief investment officer of Boca Raton-based Encore Capital Management.

“As South Florida gets basically built out, the opportunity now is combining live, work and play,” Falcone said. “People don’t like to be in cars and stuck in traffic.”

Falcone’s company acquired the 34-acre Fashion Mall in Plantation, demolished it, and is replacing it with Plantation Walk, a mixed-use redevelopment that ultimately will include 730 apartments. Tenants have started moving into two newly opened apartment buildings with 410 units, and Falcone expects construction of a third apartment building with 320 units to start early next year.

Falcone said Encore also has received certificates of occupancy for 130,000 square feet of new retail and restaurant space. Other completed projects at Plantation Walk include a Sheraton Suites hotel and a fully leased, 180,000-square-foot office building where insurance giant Aetna occupies half the space.

Newer mixed-use developments in South Florida commonly combine commercial space and rental apartments. Miami-based Terra developed Pines City Center in Pembroke Pines from the ground up with more than 300,000 square feet of retail and restaurant space and 400 apartments.

A positive market response to the residential options at Pines City Center encouraged Terra to acquire a 38-acre shopping center in Miami called Central Shopping Plaza, renovate the existing stores, including a former Kmart store that Target will occupy, and build apartments around them.

The first phase of that redevelopment, called CentroCity, will include 460 apartments, and will be completed in 12 to 18 months, said David Martin, CEO of Terra. By 2024, he said, Terra plans to build a total of 1,100 apartments and 250,000 square feet of office space at the CentroCity property in Miami’s West Little Havana neighborhood.

At Pines City Center, “what we saw was a very strong symbiotic relationship. Residents loved living around a retail offering, and retailers liked having customers who can walk to the store,” Martin said. “It becomes a lifestyle offering for the residents and obviously increases the number of repeat customers” for the retail tenants.

Another large-scale redevelopment is expected to bring a residential component to the Boynton Beach Mall. Columbus, Ohio-based Washington Prime Group won a rezoning of the 108-acre mall in Boynton Beach for a redevelopment that would combine as many as 1,420 apartments and up to 400 hotel rooms with 629,000 square feet of retail space. Washington Prime Group recently emerged from Chapter 11 bankruptcy with a new CEO.

However, shopping center owners like Beth Azor are unlikely to redevelop their properties in the absence of low occupancy rates. Azor is founder and principal of Azor Advisory Services, a Weston-based company that owns six shopping centers in Broward County.

She has no plans for multifamily development at any of her shopping centers because they aren’t distressed – three are fully leased – and because developers are building hundreds of apartments near her centers in Davie, Plantation and Sunrise.

“There are so many wiser, more experienced, richer folks doing apartments, that I like to watch their success from my vantage point,” she said, citing her career as an investor in shopping centers. “After 35 years in the business, I know how to do those, versus trying to learn how to develop multifamily properties.”

 

Source:  The Real Deal

 

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New York Developers Unveil Plan For South Beach Office Project

Two New York-based development firms are teaming up to build a Class A office project in Miami Beach.

Sumaida + Khurana and Bizzi & Partners are planning a five-story building with 56,177 square feet at 944 5th Street and 411 Michigan Avenue in the city’s South of Fifth neighborhood, according to a press release. An entity managed by principals of both firms bought the two vacant lots for a combined $8.9 million in June, records show.

The joint venture tapped renowned Spanish architect Alberto Campo Baeza to design the building, and hired Miami-based Cube 3 as the project’s executive architect.

The South of Fifth office project would be Baeza’s first building in the Miami area, and his first commercial building in the U.S., according to the release. Over the last decade, developers have enlisted world-renowned architects like Renzo Piano, Bjarke Ingels, Rem Koolhaas and the late Zaha Hadid to design luxury condominiums in South Florida.

The proposed office building will be made of white concrete, glass, and marble, featuring high ceilings, open and flexible floorplans, private outdoor terraces and floor-to-ceiling windows. The building is planned to also have a fitness center, multiple food and beverage venues, a large atrium and a private rooftop with water views.

The two development firms are collaborating on a wide range of commercial buildings across the U.S., focusing on office projects, the release states.

Founded in 2000, Bizzi & Partners focuses on developing high-end commercial and residential properties in Europe, the U.S. and Brazil, according to the company’s websites. Bizzi developed Manhattan’s 565 Broome SoHo and co-developed Eighty Seven Park in Miami Beach.

Sumaida + Khurana, which developed condos at 152 Elizabeth Street and 611 West 56th Street in New York, and its affiliates are currently developing more than 300,000 square feet of ground-up residential projects in Manhattan, with a total projected sellout of about $700 million, according to the firm’s website.

Demand for office space is rising in Miami Beach. The city’s vacancy rate was 8.2 percent in the third quarter, compared to 10.7 percent for the overall Miami-Dade office market during the same period, according to Colliers. The average asking rent hit $51.57 a square foot compared to $44.59 for the overall Miami-Dade market in the third quarter.

Last month, Pebb Capital and Maxwelle Real Estate Group formed a joint venture with Miami Beach developer Russell Galbut to convert the shuttered Bancroft Hotel at 1501 Collins Avenue into a high-end office property. The partnership bought the site for $47 million from a Galbut-related entity. Galbut submitted plans for the conversion to the city of Miami Beach in April.

In August, an entity tied to Scarsdale, New York-based Greenacres Management bought a renovated office building at 1688 Meridian Avenue near Lincoln Road in Miami Beach for $49.5 million.

 

Source:  The Real Deal

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Miami Board Rejects Design For Massive Wynwood Mixed-Use Project

It looks like it is back to the drawing board for the developers of a massive, nearly 1 million-square-foot, mixed-use project in Miami’s Wynwood.

L&L Holding Company and Carpe Real Estate Partners were dealt a setback on Wednesday, when the Miami Urban Development Review Board voted 4 to 0 to reject its proposed design for N29, an office, retail, and apartment complex.

The ruling is technically advice for Miami Planning Director Cesar Garcia-Pons, who has the ultimate say on approving the project’s design. However, UDRB member Dean Lewis told The Real Deal that the board’s recommendations are taken very seriously by planning staff.

The New York-based developers want to construct N29 on an assemblage of land at 31-95 Northwest 29th Street, 2925 Northwest First Avenue and 40-94 Northwest 30th Street in Miami.

L&L Holding Company and Carpe Real Estate are under contract to buy all of the properties, most of which are owned by the Rubell Family Collection.

The development site also abuts the 220,000-square-foot Gateway at Wynwood project.

N29 is planned to total 960,870 square feet, and range between eight and 12 stories tall. The project is proposed to include 200,000 square feet of office space, 523 residential units, 26,372 square feet of retail, 668 parking spaces, and 670 bicycle parking slots. It will also have a 22,000-square-foot, ground-floor public plaza and about 30,000 square feet of programmable space.

David Weitz, co-founder of Carpe Real Estate Partners, said the design of N29 drew “a lot of inspiration” from Oasis Wynwood, an office and retail project Carpe developed at 2335 North Miami Avenue. Weitz said that what makes Oasis unique is its large 30,000-square-foot courtyard.

While N29 already received the backing of the Wynwood Business Improvement District’s Design Review Committee in July, the project review at the UDRB was delayed in August after board members objected to the proposed building’s massing along 30th Street.

The Gensler architecture firm, which is designing the project, attempted to solve this problem by adding a 40-foot-wide paseo entrance on 30th Street and other artistic design elements.

But in the meeting on Wednesday, Ignacio Permuy, chairman of the UDRB, said the project still resembles a wall along Northwest 30th Street. “This is a huge massing that is 100 feet high and 400 feet long, and it is not being broken up,” Permuy said.

This isn’t the case along Northwest 29th Street, Permuy said. “You did a terrific job articulating and breaking up the massing and inviting the pedestrians,” he added.

Board member Robert Behar pushed for a vote to reject the current design.

“I cannot believe that there was an attempt to do what was requested,” Behar said. “That is the bottom line.”

 

Source:  The Real Deal

 

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‘Enough Buildings’: Brickell Residents Oppose Church Plan For Development

Samantha Castellano sits in Mary Brickell Park watching her 5-year-old son scale the rope ladder and slip down the slide. As a Brickell resident for 15 years, she’s seen residential and office towers clog the skyline. At nine months pregnant, Castellano, 38, said she has a big problem with First Miami Presbyterian Church looking to sell some of its land to a developer.

“I think there should be more green spaces and not more buildings,” said Castellano, who would prefer a museum or community space for her growing family. “There’s enough buildings already.”

Owning what is one of the last waterfront properties in Brickell, the church is looking to sell the parking lot and the Key Point Christian Academy building at 609 Brickell Ave. to a real estate firm for the development of a soaring residential high-rise.

Many area employees and residents told the Miami Herald they are concerned about increased traffic, limited outdoor eating options, job loss and the diminution of one of the last green spaces in the city’s financial center. Valeria Gomez, a Brickell receptionist, calls the area a hidden gem. During tours with people she works with, she advertises the many food options in the food truck plaza, located in the church’s parking lot, and the Brickell Key, Biscayne Bay and ocean views.

“You can take a walk and you don’t have to go all the time to Shake Shack or Mary Brickell Village,” she said. “It’s nice. This area is a favorite, at least for my clients.”

The 26-year-old said most days from 11 a.m. to 2 p.m. the plaza is crowded with residents who want to grab a quick bite or account managers who’d like a relaxing lunch outside the office. She recalled the crowds as she got off work after 6 p.m. earlier this week.

“All the tables were filled up, there were people waiting to get help from the food trucks and everything,” Gomez said.

Several of her clients have children enrolled in the K-8 religious school and she said she cannot imagine how the parent would feel with the school closing if the land is sold.

“You’re taking away an educational environment to make room for people outside of the area,” she said. “With that being said, I feel like it’s a terrible idea.”

Traffic jams are unbearable, she added, and a driver could be sitting in gridlock for 30 minutes when the Brickell Avenue bridge raises. With the introduction of another large condo building, she imagines matters getting worse.

“It’s still a beautiful city, I think we have to do a better job at taking care of it and remembering the people instead of the business,” Gomez said.

Church members plan to vote after services Sunday on the land sale. The Brickell-based firm, 13th Floor Investments, has proposed constructing a high-rise condo with retail and restaurants on the ground floor, as well as worship space inside the tower. If the congregation votes in favor of the proposal, the church could receive about $240 million.

Isaac Rondon, World Wide Bistro food truck owner, said he sells his gourmet burgers and Philly cheese steaks from 12 p.m. to 9 p.m. every day in the plaza. The 23-year-old relies on the Brickell customer base for sales and without the plaza he could lose his job. As a historic site in Miami, the church cannot be demolished or relocated.

The church was hit with a $7.1 million tax bill in 2018 by the Miami-Dade Property Appraiser, for permitting a portion of church grounds to a for-profit school and the food trucks, violating its religious exemption status.

John Wayland, who works in banking in Brickell, said the land is an underutilized asset and by selling a portion of the property, the church can finance additional resources and services.

“I’m not sure how many more condominium buildings Brickell needs to have going up, but I would also say that I understand the desire to be able to convert an asset into a monetary asset,” Wayland, 53, said.

Chip Hoebeke, a consulting director for a business firm, said the plaza is one of the few spaces in Brickell where visitors and locals can enjoy the comfort of street food in comparison to the influx of high-end, sit-down restaurants in the area. As a fan of the vanilla milkshakes from the World Wide Bistro, he described the food truck plaza as a space for dog owners and parents to decompress.

“This is kind of a release valve for that congestion, and at some point, when you have too much congestion it’s got a negative influence on everybody,” Hoebeke, 47, said.

 

Source:  Miami Herald

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Rilea, Promanas Buy Wynwood Dev Site, Plan Short-Term Rentals

A short-term rental project with 127 units is coming to Miami’s Wynwood neighborhood.

Developers Rilea Group and Promanas Group bought the site on the southwest corner of Northeast 29th Street and the Florida East Coast Railway tracks for $12.2 million, with plans to build The Rider, according to a release from Rilea and Promanas.

The properties at 94 and 100 Northeast 29th Street and 101 Northeast 28th Street total 0.6 acres, records show. Seller 101 NE 28 St LLC ties to Jeffrey Miller of Krillion Ventures.

Alfredo Riascos and Yonatan Missika of Gridline Properties represented the buyers. Liana Rivera of LLV Realty represented the seller.

The area still lacks hotels, which prompted the developers to build a short-term rental project, Rilea’s Diego Ojeda said in a release.

Plans call for a 12-story project with 8,500 square feet of ground-floor retail, a rooftop restaurant and a pool bar, according to the release. Construction is expected to start in 2023.

Units at The Rider, near a planned passenger commuter train station, will be rented through short-term rental sites such as Airbnb and VRBO, according to the release.

 

Source:  The Real Deal

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Car-Free Lifestyles Create Commericlal Development Niches

A car-free lifestyle and commercial real estate development opportunities are closely intertwined, a Miami Association of Realtors commercial conference panel exploring Transit Oriented Development agreed.

“The real story in Florida is population growth,” said Aaron Stolear, associate vice president of 13th Floor Investments. “We are absorbing 1,000 people a day. We will soon be absorbing 10 million people in the next 20 to 30 years. But there is not enough land or space to grow in the urban core. Without a massive transit system, we won’t be able to sustain our growth.”

Eulois Cleckley, director & CEO of Miami-Dade County Department of Transportation & Public Works, agrees and wants to maximize development of the land around transit. He is an advocate of the Smart plan that includes six rapid transit corridors throughout Miami-Dade. 

“Access is important for jobs,” Mr. Cleckley said.

Transit Oriented Development is driven by a decision to enhance or build a web of transit to maximize the space around those transit locations. The panel at the Biltmore Hotel in Coral Gables agreed that with the quick growth and packed urban core of Miami, people need the ability to live all over the county, but with access to transportation to the city. 

The conference brought together 270 realtors on Oct. 1 to discuss the future of real estate in South Florida. One of three panels, South Florida Explored: Transportation, Transit Oriented Development, examined the future of transportation in Miami. 

Moderator and principal of Infinity Commercial Real Estate John W. Dohm led the conversation with five transportation and real estate entrepreneurs and how a car-free lifestyle would excel in Miami.

Patrick Goddard, president of Brightline inter-city rail, made it clear that many people are transit averse.

“People don’t want to get on transits, they don’t understand it. There’s a lot of friction involved with getting people out of their car. We have to enable it in three ways. We need the actual infrastructure to exist. That will involve entities like Brightline and then businesses like Lyft or Uber, ebikes and scooters. So it is an ecosystem,” he said. 

Brightline is to reopen in November in South Florida and plans to offer a fleet of vehicles that are going to pick people up and take them to the transit station.

“We need to provide alternatives to the car. We cannot support any more congestion on our highways,” said Mr. Goddard, who stated that on I-95 the average speed is about 35 miles per hour and isn’t improving. “It’s one of the most dangerous in the country with about 50,000 accidents and 3,000 deaths a year. We need other ways to travel. There’s no one solution, but the community needs to support it.” 

 

“I-95 has an express bus and is very well-ridden. It is a national benchmark,” Jeremy Mullings, director of South Florida Commuter Services, said. “I represent one of those programs trying to get people to get out of their cars.”

He agreed with Mr. Goddard about transportation being an ecosystem. 

“In the late 2000s, we thought that millennials would get out of cars and ride the transit, but in 2015, when millennials became the dominant sector of the workforce, the transit started to plummet,” Mr. Mullings said. “I think the solution is going to be finding the sweet spot between government and a private sector. We don’t have it figured out yet.”

 

“When I was living in Brickell, I wouldn’t use my car for months at a time,” said Rafael Romero, senior vice president of retail advisory of Jones Lang LaSalle. “We have to find out where the consumer is comfortable for this car-free lifestyle. Where do they live, work and play? People love the ability not having to travel too far to reach their daily needs.” 

People are happy to be in walking distance of groceries, restaurants or the gym according to Mr. Romero. 

The panel agreed that the goal was to make the transit more appealing.

“Our legacy is to be a catalyst for change, living a car-free lifestyle,” Mr. Goddard said. “Are we giving you an opportunity to try it out?”

 

Source:  Miami Today

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Miami’s Tallest Tower Due In 2022

The Okan Tower is still on track to be finished in mid 2022, according to Okan CEO Kasim Badak. The $300 million project was put on hold because of the pandemic.

“The pandemic affected us,” Mr. Badak said. “But it affected everyone around the world. We stopped any operations, but we are back in business.”

Bekir Okan, a Turkish billionaire businessman, is building what would be the tallest tower in Miami and first for Okan in the US from the ground up. The building was designed by Behar Font and Partners Miami architecture firm to represent a tulip, the flower of Turkey. It is to rise at 555 N Miami Ave. and stand 70 stories tall, with 64,000 square feet of Class A office space, 294 rooms by Hilton Hotel & Resorts, 149 condominium residences and four penthouses.

In its 890 feet of height, the Okan Tower is still planned to include three pools, one outside on the 70th floor, a spa, an outdoor lounge, a fitness center, a gastro kitchen, a children’s play center, a wine cellar, a rooftop restaurant, a movie theater and a cigar room.

“We are celebrating an extraordinary person, Mr. Okan,” Miami Mayor Francis Suarez said at the Okan Tower launch party at the Perez Art Museum on May 21, 2018. “We open our arms to you and we know your project is going to be very successful.”

They had already sold 30 condos and condo-hotel units by May 2018.

When Mayor Suarez asked Mr. Okan why he loved Miami, he answered, “I love the weather, I love the casual lifestyle, but most importantly I love the people.”

Miami’s tallest tower today is the Panorama Tower, standing 868 feet.

 

Source:  Miami Today

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Psychedelic Therapy Clinic To Open First Florida Site In Wynwood

Field Trip Health, a psychedelic therapy company, picked one of Miami’s trippiest neighborhoods for its first location in Florida. The Toronto-based company plans to open in Wynwood.

Field Trip inked a lease for a 7,500-square-foot space at The Wynwood Annex, an office building that the Related Group and East End Capital built at 215 Northwest 24th Street, said Jonathon Yormak, who leads East End Capital. The eight-story, 65,000-square-foot building was completed more than three years ago and is now fully leased.

Field Trip is part of a wave of new psychedelic therapy companies that have raised tens of millions of dollars to invest in the treatment of depression and post traumatic stress disorder with drugs such as ketamine. Ketamine is the only hallucinogenic that’s currently legal for patients outside of a clinical study in the U.S., the New York Times reported.

Two bills proposed in the Florida Legislature would direct the Florida Department of Health and the state’s board of medicine to study the efficacy of ketamine, MDMA and psilocybin, the Daytona Beach News-Journal reported last week. Oregon was the first state to legalize the therapeutic use of psilocybin, the substance found in magic mushrooms. Other cities and states have decriminalized the drug or are considering similar legislation.

Field Trip has locations in New York, Toronto, Los Angeles, Chicago, Atlanta, Houston, Seattle, Amsterdam and Fredericton, Canada, according to its website. Forbes reported in July that Field Trip plans to have 20 clinics by the end of this year and 75 by 2024.

Yormak said Field Trip has been interested in the Miami market, and the company approached the developers to lease a space at the Annex. Other tenants in the building include venture capital firms Founders Fund and Atomic; Live Nation; and e-commerce company OpenStore.

Tony Arellano of Dwntwn Realty Advisors represented the landlord in the majority of leases at the Annex, including Field Trip. Miles Glascock at JLL represented Field Trip.

Modified gross rents have exceeded $62 per square foot, Yormak said.

The Annex is reportedly on the market. Yormak said that the partnership has not made a decision whether to sell, but confirmed that potential buyers have made offers to acquire the property.

 

 

Source:  The Real Deal

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Julia Apartments Break Ground In Allapattah

Neology Life, led by developer Lissette Calderon, broke ground on an apartment complex in the Allapattah neighborhood of Miami after obtaining a $78.2 million construction loan.

The Julia Apartments, named for Miami founder Julia Tuttle, will have 323 units. Construction on the 12-story building at 1625 N.W. 20th St. is expected to be completed by mid-2023.

Units in the Julia will range from 586 to 892 square feet. Amenities will include a pool with cabanas, a rooftop garden, a fitness center, a coffee bar, and a dog park.

Trez Capital provided the mortgage to TCG Allapattah, an affiliate of Neology Life, for the 1.7-acre lot.

“When we evaluate lending opportunities, we focus on the needs of a community and the track record of the developer,” said Ben Jacobson, a managing director at Trez Capital. “Partnering with Lissette and understanding her vision, we think Allapattah is perfectly positioned to attract nearby working professionals and families who desire a certain level of luxury living but are priced out of places like Brickell, downtown and Wynwood.”

 

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First Miami Presbyterian Looks To Sell Prime Real Estate For Development In Brickell

The First Miami Presbyterian Church is looking to sell a portion of its prime real estate location for development on the Miami River and church members are set to vote on the possible deal on Sunday, the church’s head of staff and reverend said Monday. The church, the oldest congregation in Miami, wants to move forward with plans to sell the waterfront parking lot and the Key Point Christian Academy building at 609 Brickell Ave. to the Brickell-based real estate firm 13th Floor Investments, according to documents shared with the Miami Herald from a source who had access to the plans at an Oct. 3 meeting of church members.

The source said the plans are for a high-rise condominium with retail and restaurant space on the ground floor. It would also provide the church with congregation space inside the tower. The project would be built on one of the last remaining waterfront properties in Brickell. With views of Brickell Key, Biscayne Bay and the ocean beyond the residential tower would sit between the Icon Brickell and an office tower 701 Brickell.

Rev. Dr. Christopher Benek said church members will vote on a plan Sunday after services, but he declined to comment on project details.

“This is a real moment before the church. God has blessed this community with an opportunity to potentially serve the people of Miami and the world to scale,” Benek said. “No matter where we land on Sunday, God has been working for the past 125 years to work through this congregation and he will continue to work through this congregation, regardless of the vote.”

According to the proposal, the church would receive about $240 million. Benek declined to comment on any financial arrangements. The 150-member church has faced financial challenges in recent years. In 2018, the church received a $7 million tax bill for allowing some of its property to be used for profit.

Benek said, “We’re not making a decision from scarcity, but of abundance.”

Another source familiar with the plans said church members have not been given enough information ahead of the planned vote this weekend.

“It’s hard to share the opportunities or challenges, because we don’t have enough details about the plan,” the source said. “You need an elected committee of church members to evaluate that. Any plan needs to be evaluated based on the needs of the church and not based on the dollars and cents of a real estate deal.”

 

Source:  Miami Herald

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