Miami Commercial Real Estate News December 2, 2020: Land for Brickell Development Trades for $24 Million; Black Friday Retail Foot Traffic Tanks; More…

Michael Stern pays $24M for future site of 62-story Brickell tower

Developer Michael Stern closed on an assemblage of properties in Miami’s Brickell neighborhood where he plans to build a 62-story tower, The Real Deal has learned.  Stern, who leads New York-based JDS Development Group, paid $9 million for property at 191 Southwest 12th Street. The seller is a company tied to John Polit. Stern also bought adjacent land from…

South Florida Retail Dodged Bullets This Year, But More Shakeout Is Expected In 2021

In spite of the coronavirus, Miami-based real estate investment firm Tricera Capital completed 45 new office and retail leases in 2020. “Buy the best-located properties at the right basis, in the core of emerging growth markets, with a heavy focus on service and convenience,” said co-founder and Managing Principal Ben Mandell about the firm’s guiding strategy.

Signature Miami bridge rising as contractor pumps out water

Work forges ahead on the expansive I-395/SR 836/I-95 Design-Build Project in Miami, a project of the Florida Department of Transportation (FDOT) in partnership with the Miami-Dade Expressway Authority and its contractor, the Archer Western-de Moya Group Joint Venture. Work along I-395 from I-95 to the MacArthur Causeway; SR 836 from west of Northwest 17th…

Office Developers, Miami Beach Wants You — With Some Caveats

Miami Beach is known for sun, sand and hotel rooms. City leaders say it’s also a great place for an office. With high-profile businessmen like Barry Sternlicht and Carl Icahn having moved to the Miami area, part of an exodus from high-tax states to business-friendly Florida, the city of Miami Beach is seeking letters of interest from developers who might want to…

Court takes hard line on late rent payment into court registry during COVID-19

Under a particular Florida statute, in a commercial eviction, where there is a court order requiring the tenant to pay rent into the court registry during the lawsuit and the tenant fails to pay, the tenant is considered to have waived its defenses and the landlord is entitled to an immediate default for possession. How strictly that rule is applied was recently put to the test.

Short-Term Woes Could Yield Long-Term Wins for Alert Office Investors

In classic contrarian fashion, investors in office space might want to watch closely in the coming weeks and months for the opportune moment to strike some deals downtown. Downtown office space is taking a beating during the pandemic, and there’s certainly a lot of reason to believe that working from home (WFH) is as much permanent reality as temporary…

Trusts benefitting Masoud Shojaee’s daughters sue to access his company’s financial records

Masoud Shojaee is facing another legal entanglement involving his daughters. Two trusts benefitting Anelise and Lilibet Shojaee sued a company managed by the Coral Gables-based developer that’s tied to a recently completed Doral mixed-use project. The lawsuit follows a separate complaint filed earlier this year by another trust benefitting his…

Housing drives rise in construction spending October

Residential construction accounted for 44% of spending in October. (iStock) A strong housing market continued to fuel construction spending this fall. Construction spending grew an estimated 1.3 percent in October to $1.43 trillion, seasonally adjusted, compared to $1.42 trillion in September, according to the U.S. Census Bureau’s monthly report. Private housing…

At The 57-Story 830 Brickell Office Tower, 8-Story Parking Garage Now Nearly Complete

In Brickell, contractors working on the 830 Brickell office tower appears close to completing a parking garage, new photos show. The eight story parking facility appears to now be nearly complete. The garage runs from level 2-8, followed by office space starting on level 14. There is strong interest by tenants in the building, brokers say. Brian Gale, Vice Chair…

Where retail sales have been booming : Sporting goods, home project supplies, and groceries are way up

We recently discussed how some areas in the retail sales sector have suffered dramatic declines during the pandemic. Today, we highlight three areas where sales have actually been booming. FRED just added monthly state retail sales data from the Census Bureau, and we can enlist the help of GeoFRED to show the details. In the first map, we see that sporting goods…

Reuben Brothers takes over $132M loan backing St. Regis Bal Harbour

British billionaire brothers David and Simon Reuben are picking up the senior loan behind the St. Regis Bal Harbour resort, as the hotel market continues to struggle. Their private equity and investment firm, Reuben Brothers, acquired the $132 million mortgage from Mack Real Estate, according to a spokesperson for Reuben Brothers. Tarek El Sayed, CEO…

Retail foot traffic tanks on Black Friday

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Notable Retail Leases Signed in South Florida Q3 2020

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Chart: September Miami-Dade Unemployment Rate Approaches Prior Peak After Prior Month Respite Head Fake

Miami-Dade County, Florida Unemployment Rate Year Ending September 1, 2020 As can be seen in the chart above of the unemployment rate in Miami-Dade for the year ending September 1, 2020, the unemployment rate as of September 1 went back up to 13.0%, not so far from its peak of 14.5% reached two months prior. This followed a welcome decline in the month…

Real estate deals dominate Opportunity Zones. Is that bad?

Investment in Opportunity Zones is growing at a rapid pace, and so is skepticism about the program — and whether its incentives for pouring cash into low-income communities amount to a tax dodge. The Economic Innovation Group, a policy group that’s a proponent of the program, identified 186 real estate and business investments in Opportunity Zones…

Pandemic takes drastic toll on dry cleaners

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Miami Beach may create incentives for affordable housing developers

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South Florida October construction starts drop, year-over-year

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Miami to Disney? Brightline announces station that would connect South Florida to Mickey Mouse

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ROVR Development Buys Miami manufactured housing community for $15M

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Mill Creek, Invesco sell Fort Lauderdale apartments for $180M

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Top Stories
December 2, 2020

Sky Kennels: Mounting Sanitation and Noise Issues for Pet Friendly High-Rise Multifamily Properties

Downtown America is Becoming an Open Sewer as Dog Populations Multiply in Multifamily Towers

As Americans have been moving back to the central business districts of its cities, a situation has been developing that has gone largely unnoticed except by those affected; downtown America is becoming an open sewer. In downtown areas it has become common to be met by the sight of a dog’s arched back. That is generally internalized as innocuous, as we all grew up with dogs in neighborhoods, and dogs poop and pee outside. Right? Yes, that is true, but only up to a point. As the density becomes too great, the concentration of urine and feces in the little remaining green space of downtown America is increasingly unpleasant if not unhealthy. Feces, after all, is feces. Though I think most would quickly agree with this after only a moment of thought, for any that doubt this claim, Popular Science addressed it in an article about how dog feces is essentially the same as that of humans. Ditto urine; pee is pee.

This is happening all across America as downtown populations swell. We’ve lived in numbers downtown before, but that was long ago in an era when dog ownership was not as prevalent. Back then families with kids got dogs, really for the kids as much as anything. Today young adults get dogs seemingly in lieu of kids, and young people like to live downtown. In reality, the modern family is less the varying relationships in the popular sitcom of that name, but instead young couples with dogs as their children. In concentrated areas as is increasingly the case, it makes for one smelly, germ ridden situation.

To make this point, let’s consider our fair city, America’s most tropical, Miami, where the year around warmth exaggerates the aromatic effects of open sewage. The ever more numerous multifamily buildings in its downtown area are increasingly dog friendly, with the resultant open sewage numbers becoming mind boggling and nostril overwhelming in some parts. In a 2018 article, the population in Greater Downtown Miami was estimated to be approaching 210,000. Some buildings downtown – more on that later – appear to have as many as half as many dogs as people. For illustration purposes on a city-wide level, let’s guess that there are 20% as many dogs downtown as people. That equates to 42,000 dogs. If there aren’t that many now – I truly can’t say for sure – there will be, and then later more. With that assumption, here is what that adds up to in total excrement:

42,000 Dogs (assumed)
x 20 pound average weight
x 15 midpoint of 10 to 20 ml of urine for per pound of body weight per day
x 365 days per year
÷ 3,785 ml per gallon
________________

1,215,000 +/- gallons urine per year

To put this in perspective, this would fill 90 13,500 gallon typical home swimming pools.

Mind boggling, right? Walk around and notice the smell, particularly in any patch of green space near any dog friendly building in downtown. That smell, the one like that in stairwells in public transit stations, is the result.

Then there is the feces. Again, let’s pick on tropical Miami as an example:

42,000 dogs (assumed)
x 0.75 pounds of feces per day for the average dog
x 365 days per year
_____________________________

11.5 million +/- pounds of feces dropped per year

Yep.

In the above calculation, note that I use a daily feces per dog amount of 0.75 pounds. That comes from a document about clean water which further notes that a single average dog’s feces contains 7.82 billion bacterial coliforms each day. The article goes further – you know how those these silly clean water types can be – to note the general and significant health risks of dog feces. Thought I’d drop that in.

An astute reader, particularly if partial to dogs, will note that most feces is picked up by owners. That is generally true. Regardless, the residual feces smear left each time a dog defecates, visibly obvious to anyone that looks where dog has poop has just been removed, is significant enough to make the point. For the following, we’ll assume that a mere 1/4 of an ounce, a bit more than a teaspoon, of feces dropped remains, on average, per defecation, sometimes more for those with “digestive issues,” sometimes less.

42,000 Dogs (assumed)
x 0.25 oz. of residual feces per defecation
x 2 defecations per day
÷ 16 oz per pound
x 365 days peryear
__________________________

479,000 pounds +/- of residual feces left on downtown Miami greenspace per year

That aforementioned astute reader that loves dogs would perhaps point out that “insects and microorganisms consume it,” perhaps noting this as natural and good, Whole-Foods-like. I would not entirely disagree with the point, but I would note that there is a term for such: open sewer. If one deranged person poops at the bus stop, it is a clean up issue, but if everyone poops outside, it is an open sewer. The point? It is not the act that makes it an open sewer, it is the density. Ditto for dogs.

Also, and I think worse, dog owners sometimes allow their dogs to defecate and urinate on their balconies. This causes urine and feces to drip down not only on other units, but into the swimming pools, hot tubs, and other common facilities located below. “is that rain?” “Er, no.”

There is also the issue of the fecal and urination accidents in elevators and hallways, frequently left by entitled owner types “for the little people to clean up.” Again, do the math. Assume, in a building with 200 dogs, every 50th time a dog is taken out to relieve itself, there is an accident. Well, with 200 dogs going out 2 x per day, this would mean 8 accidents in elevators, per day, nearly 3,000 a year! Residents of dog friendly buildings will tell you that calculation matches their experience.

Then there is the incessant barking, like a giant kennel cage in the sky. Woof. Everywhere, always, woof. The sounds of the sky kennel.

Anyone considering visiting a dog friendly building with small children, anyone elderly, anyone undergoing chemotherapy, or anyone with a compromised immune system would be well served to look up campylobacter. People don’t realize that dogs are carriers of bacteria that can make people ill. Outbreaks attributable to dogs, like this one, likely go undetected all the time. Common sense would indicate that staying away from a place where dogs urinate and defecate several hundred times per day in a small area, aka an open sewer, might make sense for anyone with any immune deficiency, but people don’t think of this. Other wonderful things transmitted by dog feces, as noted by DoodyCalls (great name, right?), include whipworms, hookworms, roundworms, tapeworms, parvo, corona, giardiasis, salmonellosis, and cryptosporidiosis. Also, some of these can be found in swimming pools. Thus, if you find yourself ill in the days after swimming in the pool of a high rise, the culprit may have been above you in the buildings sh#tmist, the residue swept or washed off of the balconies of dog owners that have their mutts poop and pee on their balconies. Pleasant, right? Brings to mind the old expression “don’t eat where you sh#t.”

Americans criticize developing countries for open sewage ditches, for living among their feces. Are we not doing the same thing? Though open sewage and consequent hookworm epidemic is increasingly seen as an issue in America’s poorer areas, are we not inviting the same issues into our downtown areas at large? Why would we do that?

This is all seemingly a byproduct of zoning code or other laws that are not clearly applicable or perhaps are even ignored. It seems to not at all. Zoning or other rules tend to limit dogs per acre in residential areas unless you are a kennel, and high-rise residential buildings are not registered as kennels. In Miami-Dade, one cannot own more than four dogs on properties under an acre. The reason for such limits has to do with sanitation and noise, health and quality of life issues. What is to be done, however, for a property that has hundreds of dogs per acre, but spread over multiple floors.

What can you do?

Bring it up in local government meetings. Email, write, or fax your local government officials. This is a growing issue, but few at the moment are vocal about it. Your voice is needed. Here in Miami, those aggrieved or just with something to say about it might contact their local Miami commissioner Ken Russell, their mayor Francis Suarez, and the city of Miami’s zoning department to ask why they allow open sewage in downtown Miami.

Also, vote with your pocketbook by not moving into a dog friendly building. Let management know why you are not moving there. Post comments about all this issue on social media and in building reviews. You’ll be helping others avoid nuisance and inconvenience they’ll otherwise not notice until it is too late.

Note there are canine population assumptions in this post that are only that, assumptions. Though I’ve tried to use numbers that are reasonably representative of reality, I can’t be sure as to the exact population numbers. 

Related Posts:

There are numbers of related posts linked to in this post. If you need more, check out some of these:

Zoonotic Diseases in Dogs
Is Pet Waste Harmful to Humans? Diseases From Dog Poop
Zoonoses: The Diseases Our Cats and Dogs Give Us
Exposure to Animal Feces and Human Health: A Systematic Review and Proposed Research Priorities
Dog droppings pose a health risk
11 Ways Your Beloved Pet May Make You Sick
Diseases From Animals: A Primer
Miami Is the Nation’s Best City for Dog Owners
Miami Ranked the Best City to Be a Dog in the U.S.
Solving The Pet Pee Needs In An Urban High-Rise Apartment

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Development
December 2, 2020

Chart: September Miami-Dade Unemployment Rate Approaches Prior Peak After Prior Month Respite Head Fake

Miami-Dade County, Florida Unemployment Rate Year Ending September 1, 2020

As can be seen in the chart above of the unemployment rate in Miami-Dade for the year ending September 1, 2020, the unemployment rate as of September 1 went back up to 13.0%, not so far from its peak of 14.5% reached two months prior. This followed a welcome decline in the month between to 8.0%, the lowest since March 2020, that now seems to have been a statistical head fake given the benefit of hindsight.

Unemployment levels have remained elevated since COVID-19 reeared its head in March. In the months prior to this, the unemployment rate was two-ish in general, registering a tight 1.5% in February 2020. The effects of COVID-19 on employment and the economy in the Miami area and around the country continue.

Higher unemployment rates can have negative effects on commercial real estate, increasing vacancy rates and decreasing rent growth. Offsetting this is the associated low cost of money, and perhaps the prospect of inflation in the near future due to the ballooning of money supply with efforts to mitigate the effects of the coronavirus. On a good note, as we experience new surges in infections, we seem to be figuring out how to navigate them better, thus presumably future effects will at least be less pronounced. Even more positively, it is looking like a vaccine will be available within months.

Here’s hoping.

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Economy
November 26, 2020

Miami Commercial Real Estate News November 25, 2020: Delano South Beach Trades; PortMiami Sets Cargo Record; 312K sf Industrial Development Breaks Ground; More…

Despite pandemic, PortMiami sets all-time cargo record

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Eldridge Acquires the Hudson Hotel and Delano South Beach from sbe

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Goldman Properties buys Wynwood property for discounted $5M

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Tech giants occupy nearly 600M-sf of US real estate

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Regal Cinemas scores financial rescue package

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What doom-and-gloom forecasts miss about the office market

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PortMiami Cargo Keeps Head Above Water In Downturn

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Developers pay $15M for Miami River mobile home park

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Pharrell’s Billionaire Boys Club to open store in Wynwood

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Affiliated Development launches $125M workforce housing fund

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Retailers now owe $52 billion in back rent

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Doral’s Economy Begins To Recover

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Miami Commercial Real Estate Sales to List Price Ratio Firms Back Up ~ October 2020 MLS

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Developers score $15M construction loan for Miami townhouse development

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Questions surround $50M in EB-5 investments tied to former INS building: lawsuit

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Real estate investment firm Elion Partners bought a Pompano Beach distribution center for $11.65 million. The 94,000-square-foot center at 3141 Southwest 10th Street is part of a larger series of logistics purchases that Miami-based Elion plans to make in markets including Broward and Miami-Dade counties, according to a press release. Aftermarket parts and tools…

Mixed-use Delray Beach development on former Office Depot HQ site advances

Delray Beach board members gave partial initial approval to a proposed mixed-use development with about 600 residential units on the site of Office Depot’s former headquarters. The Delray Beach Site Plan Review and Appearance Board unanimously approved changes to a site plan, landscape plan and architectural elevation for the residential…

Mattos family pays $20M for Waterway Shoppes of Weston

The Mattos family expanded its South Florida holdings by buying a shopping center in Weston for $20.45 million. A company managed by Nicolas and Isabella Mattos — the children of Carlos Mattos, founder of car importer Hyundai Colombia Automotriz — bought the Waterway Shoppes of Weston at 2210-2282 Weston Road, according to records. The buying…

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November 25, 2020

Chart: Miami Commercial Real Estate Sales to List Price Ratio Firms Back Up ~ October 2020 MLS

Miami Association of Realtors January 2010 to October 2020 Sales to List Price Ratio for Commercial/Industrial Property Type Classification within Miami-Dade County and Price from $1 Million to $10 Million

The sales to list price ratio as reported by the Miami MLS for improved commercial real estate within Miami-Dade County from $1 million to $10 million firmed back up in October to just over 90% after a dip in September. This put the ratio within but in the lower end of a 5% band it has been in for the past year or so.

It remains reasonable to assume there is a touch of COVID effect on this ratio, with the sales to list prior ratio seeming to now be a touch lower than before COVID. Nonetheless, this ratio continues to remain in the middle of where it has been in the past decade, as can also be clearly seen in the chart.

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November 19, 2020

Miami Commercial Real Estate News November 18, 2020: Brightline Pack has Wynwood Station; Miami Lakes Industrial Trades for $15 Million; More…

Melo Group Tops Off Miami Twin Towers

Downtown 5th, a downtown Miami mixed-use multifamily property with 1,042 units planned for two 52-story buildings, is moving closer to completion as construction crews have topped off the East Tower and expect to top off the West Tower later this month. Developer Melo Group expects construction to be completed in summer 2021 with pre-leasing…

Centennial Management Lands $20M Refi for Miami-Area Affordable Community

Centennial Management has received a $20 million HUD-insured loan to refinance Pembroke Park Apartments, a 244-unit affordable housing community in Pembroke Park, Fla. Greystone provided the Section 223(f) financing with a 35-year term and a low, fixed rate. According to Yardi Matrix information, Centennial previously financed the property in 2011…

Dorms no more: Student housing turns into high-end apartments

Developers are eyeing sparsely-populated student housing as an opportunity to create high-end apartments for professionals. According to data from Moody’s, 30 percent of public and private universities in the country are running deficits, the New York Times reported. And with fewer students on campus due to the pandemic, some are looking to close…

Miami-Dade seeks proposals to develop mixed-use project at Vizcaya station

Miami-Dade County issued a request for proposals to develop the property next to the Vizcaya Metrorail Station, near the entrance to Miami’s Brickell neighborhood. Proposals are due to the county by Nov. 30 for the 2.6-acre property at 3205 Southwest First Avenue, documents show. The development agreement would allow a multi-phased project to be built…

Miami Beach Convention Center hotel plan still alive

Development of a Miami Beach Convention Center Hotel has been delayed for an unknown period, but developer David Martin of MB Mixed Use Investment LLC said in a statement he is still confident in the project. On March 16, Miami Beach spokesperson Melissa Berthier told Miami Today this week, the developer notified the city that it was experiencing…

Chart: Miami-Dade Commercial Real Estate Sales Maintain Strength ~ October 2020 MLS

As can be seen in the chart above of the trailing two yearsof closed sales of Miami-Dade commercial property, both improved commercial property (with buildings) and vacant commercial land, recorded in the Miami MLS. October 2020 was again a strong month in line with recent, also strong, months. The Miami Multiple Listing Service (MLS) will not record all…

Miami Marine Stadium, if restored, couldn’t welcome public

Imagine the City of Miami spending more than $40 million to restore the iconic Marine Stadium only to be prohibited from using it for “public assembly” because that special use permit expired long ago after the stadium was closed in 1992 in the wake of Hurricane Andrew. That’s the reality facing city officials, who have been pushing for a zoning text…

Brightline pact has a Wynwood station on track

A binding deal between Miami-Dade and Brightline for a Miami-to-Aventura commuter rail line isn’t signed, but details of the project – including plans for a station in Wynwood – are coming into focus. County commissioners Nov. 13 approved a resolution directing incoming Mayor Daniella Levine Cava’s administration to negotiate with the private…

Coral Gables Country Club tussles with city over rent relief

A resolution to grant a rent deferment for the Coral Gables Country Club is still under negotiation and has yet to reach an agreement with the city. During the Oct. 27 city commission meeting, Commissioner Jorge L. Fors Jr. was authorized to speak with country club’s CEO Anthony Di Donato to resolve and move forward with a deferred rent and payment plan only…

Miami Beach hunts for venue sponsorship revenue

Miami Beach commissioners, who seek to reduce the city’s dependence on tourism as that sector continues to falter, explored on Friday the first category of opportunities for economic expansion laid out by city administration: sponsorship opportunities and naming rights.  At a meeting of the Finance and Economic Resiliency Committee last month…

Wynwood team recommends an adaptive re-use building

The Wynwood Design Review Committee is recommending approval of an adaptive re-use project designed to revive a high-profile corner in the booming Wynwood Arts District. The one-story building is at 2521 NW Third Ave., at the southeast corner of Northwest Third Avenue and 26th Street. The owner is David Lerner and the applicant is MKDA FL.

Albert Garcia: Wynwood leader aims to double 5.5 million visitor record

Albert Garcia considers himself an agent of change, a leader drawn to jobs and environments with steep challenges that offer equal or greater opportunities. Such is the case with his chairmanship of the Wynwood Business Improvement District (BID), the funding mechanism and overlaying organization that over the past decade has helped to transform…

Miami Beach asks for offers to develop lots near Lincoln Road

Miami Beach wants to develop parking lots near Lincoln Road into Class A office space, banking on demand fueled by executives migrating south. Developers can submit letters of intent by 3 p.m. on Jan. 11 for a public-private partnership to redevelop the three lots next to Lincoln Road between Alton Road and Meridian Avenue. Combined, the land could…

Developers score $15M construction loan for Miami townhouse development

A partnership of two local developers received a $15.3 million construction loan to build 30 luxury townhouses near South Miami. Miami-based Apollo Bank provided the loan for the proposed development at 6790 to 6880 Southwest 80th Street in Miami. The project is dubbed the Somi Subdivision, according to records. The borrowers are a company…

U.S. retail spending slows but still higher than last year

Americans are spending more money than they did at this time last year — and even last month — but the trend may slow as Covid-19 cases spike throughout the country. According to the latest statistics from the Census Bureau, American shoppers spent $553.3 billion in October, a 0.3 percent increase from $551.9 billion in September, and 5.7 percent above the…

Miami commissioners reject proposals for marina redevelopment

Biscayne Marine Partners’ rendering of new boat storage and marina facilityvirgin For the second time in six years, the Miami City Commission deep-sixed proposals to redevelop two city-owned marinas on Virginia Key. Commissioners voted 3-2 to throw out all proposals, including an $80 million plan submitted by the top-ranked bidder Virginia Key LLC…

8 Vital Questions (and Answers) for South Florida Real Estate Investors

MMG’s Director of Acquisitions, Marcos Puente, discusses the current state of the South Florida / Miami real estate market. More specifically, he addresses the factors to consider for South Florida real estate investors, and the direct impact of the pandemic in the area. He also dives into the future of the market with a positive…

Oversubscribed: Russell Galbut and Michael Liebowitz’s SPAC raises $115M

The blank check company formed by developer Russell Galbut and investor Michael S. Liebowitz raised $115 million, $15 million more than its $100 million goal. New Beginnings Acquisition Corp. closed its oversubscribed initial public offering in early November, after forming the special-purpose acquisition company last month, Liebowitz said. The firm plans to invest…

Climate concern driving down sales and prices along coastal Florida: report

Concern over climate change may be driving down sales volume and prices for homes along coastal Florida, according to a recently released report. The study published by two researchers at The Wharton School at the University of Pennsylvania found that from 2013 to 2018, sales in coastal Florida census tracts with the most exposure to sea level rise declined…

Apartment developer buys South Miami Winn-Dixie site from Bacardi JV

Apartment developer AvalonBay Communities paid nearly $19 million for the Winn-Dixie property in downtown South Miami. Property records show 5850 S.W. 73 Street LLC sold the 1.9-acre site at 5850 Southwest 73rd Street to Avalon SoMi LLC, an affiliate of the real estate investment trust. The seller is tied to the Bacardi family and Henry Pino’s Alta Development…

Sapir Corp names Sharon Raz CEO

Sapir Corp’s Alex Sapir and Sharon Raz Sapir Corp has named former Elad U.S. Holding CFO Sharon Raz as its next CEO, the development firm announced Monday. The appointment comes a week after the company’s previous CEO, Amir Richulsky, resigned to pursue a job opportunity in a different industry. “Sharon Raz is a seasoned leader with just the right…

Back to the future: Automat dining concept gets Covid upgrade

A century-old dining concept is being resurrected in the New York metro area, as restaurant owners struggle for customers amid the continued coronavirus restrictions. Automat Kitchen in Jersey City and Brooklyn Dumpling Shop — in Manhattan — are updating the automat, in which meals are served to customers via vending machine-like lockers…

MMG’s Marcos Puente Featured on Retail Real Estate Expert Roundup

N3 Real Estate, a national real estate company specializing in retail properties, aggregated a collection of insights from retail real estate experts regarding the state of retail real estate in the coming year or two. Answers were provided by a number retail professionals, and MMG’s Marcos Puente provided his view on where retail property valuations…

Miami-Dade moves forward with multimillion-dollar Brightline deal

On Friday, the Miami-Dade County Commission unanimously approved a resolution authorizing further discussions with Brightline, Florida East Coast Railway and the county to create a commuter rail. The commuter train system would operate between downtown Miami and Aventura with as many as eight stations in Miami-Dade, and it could extend as far…

Michael Gianaris to President-elect Biden: Cancel rent

State Sen. Michael Gianaris and President-elect Joe Biden (Getty) State Sen. Michael Gianaris is calling on President-elect Joe Biden to provide relief for New Yorkers — in the form of canceling rent. The Democratic politician, who represents Astoria, Queens, and, as the deputy majority leader of the Senate is the second highest–ranking member of the legislature in New…

Pre-pandemic evictions resume in Miami-Dade

Residential and commercial evictions filed before March 13 can resume in Miami-Dade County, the mayor’s office announced on Friday. On one of his last days in office, Mayor Carlos Gimenez directed the Miami-Dade Police Department to begin enforcing writs of possessions for all cases filed on or before March 12, when the mayor declared a state of emergency due…

Are we still in a recession? : What to expect from the NBER business cycle dating committee

The Downturn and Rebound April 29, 2020: In its advance estimate, the Bureau of Economic Analysis (BEA) reported that real GDP for the first quarter of 2020 fell at a 4.8% annual rate. May 8, 2020: The Bureau of Labor Statistics reported that nonfarm payrolls fell by 20.5 million in April—the largest one-month percentage decline on record (dating back to 1939).

Owners of Ritz-Carlton South Beach and Bal Harbour hotels merge with Sagamore

The three families that own Ritz-Carlton hotels in South Beach and Bal Harbour, as well as the Sagamore Hotel in Miami Beach, merged ownership of their properties. The Ben-Josef Group, which owns the Sagamore, and partners Flag Luxury Group and Lionstone Group, which own the two Ritz-Carltons, secured a joint merger, and could bring the Sagamore under…

From underwear to surgical masks: Isaco sells Miami Lakes warehouse for $15M

A warehouse in Miami Lakes will move from making underwear to masks, after a medical device manufacturer paid $15 million for the 156,000-square-foot building. DemeTech, based in Miami Lakes and led by Luis Arguello Jr., bought the property at 5980 Miami Lakes Drive, according to a press release. DemeTech’s products include N95 respirator masks…

Manhattan-based asset manager, down on NYC, opens Miami office

As lockdowns continue to affect New York, Marathon Asset Management is setting up an office in Miami. While the investing team will remain in New York, the new Miami office will be available for all other personnel. Read more New Yorkers snap up high-end rentals in Miami Beach Following the money, NY brokers seek licenses in other states Return to the office?

Sale Of Doral Industrial Warehouse Negotiated

DiGiacomo Group’s Stephen J. DiGiacomo, SIOR, Roger Zuniga and Patricia Marquez negotiated the sale of an industrial warehouse totaling 107,667 square feet located at 1910 NW 97th Avenue in Doral. Buyer Park 1910 NW 97 Ave Owner LLC purchased the warehouse, which is situated on just over 6 acres, from Clover Logistic 1910 PROPERTY HOLDINGS…

Knotel may slash its global portfolio by 60%

Knotel once hoped to be the next WeWork. And as the pandemic rages on, it’s facing similar headwinds as its co-working rival. The flex office provider is looking to trim 60 percent of its 4.8 million-square-foot global portfolio, and slash its leases in the U.S. and Canada from 3.4 million square feet to just 500,000 square feet, Business Insider reported. Knotel’s goal is to…

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November 18, 2020

Chart: Miami-Dade Commercial Real Estate Sales Maintain Strength ~ October 2020 MLS

Miami MLS Number of Sales from November 2018 to October 2020 in Miami-Dade County Property Types: Commercial, Industrial; Commercial, Business, Agricultural, or Industrial Vacant Land

As can be seen in the chart above of the trailing two years of closed sales of Miami-Dade commercial property, both improved commercial property (with buildings) and vacant commercial land, recorded in the Miami MLS. October 2020 was again a strong month in line with recent, also strong, months. The Miami Multiple Listing Service (MLS) will not record all commercial property sales and thus cannot be said to be fully representative of the asset class. Nonetheless, it does record many, and given that it is representative of commercial property sales recorded in MLS in a prior period versus now, it should be reasonable reliable as a tool for comparing activity between periods.

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November 12, 2020

Miami Commercial Real Estate News November 11, 2020: NMB Commission Finally Approves $1.5 Billion Development; 37-Story Tower with Zero Parking Proposed; More…

Miami-Dade’s Retail Market Posts Net Negative Absorption, Rent Declines in Third Quarter

Miami-Dade County’s retail market posted 120,934 square feet of negative net absorption in the third quarter, according to research from Colliers International. The decline is a sizable improvement from the second quarter, a period where the market gave back 230,698 square feet of retail space. Year-to-date absorption remains positive for Miami-Dade County…

IHG Breaks Ground on First Atwell Suites Hotel

IHG Hotels & Resorts has begun construction on the first property of its latest all-suites brand. The Atwell Suites hotel, which is owned by Francisco Arocha, Pedro Villar, Albert Ovadia and Sunview Cos., is located in Miami and is expected to open by the summer of 2021. The 90-key Atwell Suites hotel is aimed at the upper-midscale traveler who opts for longer stays…

Sweetwater District Industrial Building Brokered for $44 Million

Newmark has brokered the $44 million sale of a 312,000-square-foot industrial facility located within Dolphin Commerce Park in Miami. Tech Data Corp. sold the property to Badia Spices, a local manufacturer and distributor of spices and herbs that will eventually move into the building. Built in 2002, the property at 2200 NW 112th Avenue is situated…

Trump plan would let real estate firms avoid SALT deduction cap

The Treasury Department has announced a new measure that would allow many businesses to get around the cap on state and local tax deductions. Congressional Republicans and the Trump administration implemented the $10,000 cap as part of their 2017 tax overhaul. But it has been met with heavy resistance from both the real estate industry and Democrats…

Federal Realty’s Proposed Redevelopment Of The Shops at Sunset Place Falls Through

The Shops at Sunset Place in South Miami will not be redeveloped as planned, its lead developer said in Securities and Exchange Commission filings and on a conference call last week. The long-struggling mall had been slated for a partial teardown and the addition of three new 17-story towers that would house apartments and hotel rooms. “There’s nothing…”

Logistics Firm Clover Systems Completes $16.2 Million Sale-Leaseback of Warehouse in Doral

Logistics firm Clover Systems has sold a 113,891-square-foot warehouse in Doral for $16.2 million. The family-owned company signed a short-term lease to remain at 1910 NW 97th Avenue, which is situated nine miles east of Miami International Airport and 15 miles east of downtown Miami. The buyer was Los Angeles-based 1910 NW 97th Ave Owner LLC, an…

Studies suggest targeted lockdowns of restaurants, gyms, hotels to curb Covid

Going to a restaurant, gym or hotel? It may not be as safe as you’d think. A new study by researchers at Stanford University and Northwestern University tracked the movement of people and compared it to Covid outbreaks, according to Bloomberg. The study estimated that just 10 percent of locations account for 85 percent of predicted infections. In Chicago, for…

Terra proposes 1,384-unit apartment complex near Magic City Casino

David Martin, Central Shopping Plaza, and a rendering of the apartment complex Terra, one of South Florida’s most prolific developers, is looking to build a seven-building apartment complex behind the Central Shopping Plaza in Miami’s Flagami neighborhood. The proposed development would take up 2.5 million square feet and add 1,384 apartments to the 38-acre…

Third time’s the charm: North Miami Beach approves $1.5B Dezer project

For the third time, and in spite of opposition from many nearby Eastern Shores dwellers, the North Miami Beach City Commission narrowly approved a development agreement and new zoning plan that will enable Dezer Development to move forward with its $1.5 billion plan to redevelop the Intracoastal Mall. Next, the developer will need to obtain Florida…

‘Nowhere To Put ‘Em’: Boating Craze Pushes Marinas Into Hot Property Territory

Integra Investments principal Victor Ballestas accidentally stumbled into the marina industry. After having worked on numerous condominium developments, he co-developed a project in Bay Harbor Islands, near Miami, that had a marina component with 14 slips. Seeing the high demand for them, his firm went on to buy marinas in the Florida Keys and even…

Downtown Miami developer seeks 37-story tower with all off-site parking

A 37-story mixed-use residential tower is planned for the heart of downtown Miami. To be called The District, the project will include 343 residential units, 2,297 square feet of commercial-retail use, and zero parking. The developer is requesting a waiver to allow all parking off-site. The city’s Urban Development Review Board has voted unanimously to…

Ocean Drive overhaul won’t come quickly, mayor says

Updating Miami Beach’s newly-named Art Deco Cultural District has been the talk of the city commission all fall, but a major change isn’t likely overnight.  At a workshop Sept. 17, commissioners and city staff brainstormed ideas for re-imagining the Mixed-Use Entertainment District, which officials agreed hosted many good business operators but also…

Creative minds use ingenuity to map road to economic recovery

As Miami-Dade continues to battle the novel coronavirus under “new normal” conditions, its path to recovery and prosperity relies in large part on creative minds whose ingenuity will pave the way. Thanks to the inventiveness of John Stuart, director of FIU’s Miami Beach Urban Studio, home to one of the largest 3D printing labs in the state, thousands of lives…

You can’t put Humpty Dumpty together again in South Beach

Miami Beach is stumbling through a minefield that could blow up its economy. Impacts of a worsening pandemic are battering the city’s economic driver, its visitor industry, causing officials to assess diversifying away from reliance on guests.  Nobody has hit the panic button, but it is at hand. The city spent years and millions to modernize a convention…

Foreclosure filings picked up in October up despite moratoriums

Despite federal and state moratoriums, foreclosure activity in the United States ballooned last month. Nearly 12,000 properties had some kind of foreclosure filing in October 2020, up 20 percent from last month but down 79 percent from October 2019, according to a monthly report from Attom Data. That largely continued a trend of growing foreclosures that began…

Video: Related’s Stephen Ross Discusses COVID CRE Effects on CNBC Power Lunch

Stephen Ross, the chairman and majority owner of The Related Companies, a global real estate development firm he founded in 1972 that has been and continues to be very active in Miami, and owner of the Miami Dolphins, discusses reopening and the state of commercial real estate projects like Hudson Yards in New York in elsewhere. This discussion concentrates…

Investcorp sells nearly $1B in multifamily assets

The private equity firm Investcorp has sold eight multifamily properties across the U.S. for $900 million. Investcorp said it sold the properties to multiple buyers, though it did not disclose specifically who those were. The buildings are located in four states — Arizona, California, Florida and New York — and were acquired by the company in 2016 and 2017, according…

Office unease: Tenants are paying up but staying away

A pattern has emerged among office landlords reporting their third quarter results: The vast majority of tenants kept up with rent payments, but an equal number also kept their workers away. Investment firm and REIT executives reported strong rent collections across much of their office portfolios, a positive sign for their immediate bottom line. At many of…

Negotiating: Strategic Advantages of Backup Offers for Commercial Property Buyers

I regularly am in situations where a buyer is interested in some commercial property that is already under contract. It is the exception where I don’t recommend submitting a backup offer. There are two principal advantages to a buyer of submitting a backup offer in an effort to put a backup contract in place. Both are strategic advantages. “This is the bottom line; win the…”

Video: How COVID-19 is Impacting Commercial Real Estate

In this video from Yahoo Finance, Doubleline Capital Portfolio Manager Morris Chen joins Julia La Roche and Zack Guzman of Yahoo Finance to discuss in some detail the latest commercial real estate outlook amid COVID-19. They talk about the variance in pain among various commercial real estate sectors as well as the offsetting positives of an extremely low…

From inflation targeting to average inflation targeting : The Fed’s new long-run monetary framework

Since 1996, it has been understood among Fed policymakers that the (undeclared) target for inflation was around 2%. In January 2012, Chairman Ben Bernanke made this implicit inflation target explicit and official, thereby aligning the Fed’s inflation target with that of all the major central banks. In this framework, when inflation has approached or exceeded…

Bridge, PGIM Secure $67M Construction Loan For South Florida Cold Storage Project

Joint venture partners Bridge Development Partners, one of South Florida’s most active industrial real estate developers, and PGIM Real Estate, the global real estate investment and financing business of Prudential Financial, Inc., announced it has secured $67 million in financing to develop Bridge Point Cold Logistics Center, a 312,103-square-foot speculative cold storage facility in Hialeah. The loan was issued…

Sapir Corp CEO Amir Richulsky resigns

After about half a year as Sapir Corp’s CEO, Amir Richulsky is leaving for another firm. The developer announced Richulsky’s resignation in a Sunday filing on the Tel Aviv Stock Exchange, where the company’s bonds are listed. The disclosure did not specify where Richulsky is going, but notes that his tenure will officially end in December. Richulsky, previously Sapir Corp’s…

Office, apartment REITs get shot in the arm from vaccine news

New York office and apartment landlords received a rare shot of good news Monday with Pfizer’s announcement that it’s getting closer to developing an effective Covid-19 vaccine. An early analysis found that Pfizer’s vaccine was more than 90 percent effective in treating Covid-19 on clinical volunteers. The company said it could potentially manufacture enough vaccines for…

Oak Street Real Estate Capital buys Oakland Park Walgreens for $7M

Oak Street Jim Hennessey and Marc Zahr with 3100 North Andrews Avenue, Oakland Park The flurry of Walgreens trades continues with an Oakland Park store selling for $7.3 million. Walgreen Co. sold the store at 3100 North Andrews Avenue. The buyer is a company affiliated with Chicago-based private equity firm Oak Street Real Estate Capital. In June, Oak Street…

Lame-duck Congress will resume stimulus package talks

After several long days of vote counting last week, former Vice President Joe Biden emerged as the president-elect, Republicans gained more seats in the House and control of the Senate hinges on the results of two run-off elections in Georgia. Congress will now enter a lame-duck session, where little is typically accomplished even under normal circumstances…

Real estate to Trump: Produce evidence or move on

Former Vice President Joe Biden declared victory in the contentious 2020 presidential race Saturday morning after securing the clinching number of Electoral College votes from Pennsylvania. President Donald Trump, however, refused to concede Saturday, vowing that he would “not rest until the American People have the honest vote count,” likely setting the stage…

GLP pays $16 million for Doral warehouse

A family that owns an international logistics company sold a Doral warehouse for $16.2 million. The Rincón family, which owns and operates the Clover Group, sold the 100,000-plus-square-foot building at 1910 Northwest 97th Avenue, according to records. The buyer shares a Santa Monica address with GLP Capital Partners, an investment firm that…

Hard-hit retail, restaurants, construction show big jobs gains in October

A handful of industries that have sustained the most damage from the pandemic reported the biggest job gains in October, pointing to an improving economy despite Covid-19’s surging numbers nationwide. Travel and leisure companies added 271,000 jobs last month, retail added 104,000 positions and construction gained 84,000 jobs, according to data released…

Miami commercial brokerage alleges it was stiffed on medical office commission

A Miami-based commercial real estate brokerage alleges that a buyer and seller cut it out of its commission on a medical office deal. The brokerage, Real Capital Partners, sued the buyer and seller of the three-building, 10-acre medical office campus at 7400, 7500 and 7800 Southwest 87th Avenue in Miami, according to the lawsuit filed last month in Miami-Dade …

Prospect of divided government rallies real estate stocks

During a week of uncertainty for the country, the stock market had its best performance since April. Real estate stocks were among the big gainers as votes for president and Congress were cast and counted. Top performers in the industry included large service companies and asset-management firms, proptech and residential home builders. Gains were lower for…

Video: “It’s going to take longer, and it’s going to cost more”: Craig Solomon on the real estate capital stack

Craig Solomon is one of the most active lenders and investors in a market that’s rife with uncertainty. His firm, Square Mile Capital, has made some recent big bets on last-mile real estate and is quickly becoming one of the country’s largest owners of soundstage space, with acquisitions such as Silvercup Studios in New York City and CBS Television City in Los Angeles.

Black Creek buys Davie apartments for $79M

Real estate management firm Black Creek Group bought a 340-unit apartment complex in Davie for $79.1 million. Black Creek, based in Denver and led by CEO Raj Dhanda, bought the complex at 11000 Cameron Court for about $233,000 a unit, according to records. Los Angeles-based investment firm CIM Group sold the complex, which was built in 1998.

Suburban office demand spikes as working from home continues

Interest in small suburban offices is picking up as more people continue to work from home, and relocate outside of major urban centers. For IWG, the short-term office company, deals for its downtown New York offices have collapsed by 30 percent since the virus outbreak, while activity in southern Connecticut has surged more than 40 percent, according to Bloomberg.

Election puts real estate’s generous tax breaks in spotlight

For many in the real estate industry, having a developer in the Oval Office has brought an uncomfortable amount of media attention to a long-standing practice: avoiding taxes. A series of recent articles in The New York Times and other outlets have showcased the many ways developers and investors use tax breaks to lower their bills — sometimes to zero.

Mall giant Unibail-Rodamco-Westfield says its real estate is worth 11% less than year ago

Unibail-Rodamco-Westfield saw U.S. rental income tumble 39 percent year-over-year in the third quarter, the company disclosed Sunday. The retail landlord and investor reported that rental income from U.S. operations, including from 39 Westfield-branded malls, fell to $464 million. Across its overall portfolio, which includes major…

Has there been a “Trump effect” on property values?

Despite Trump’s claim that he will boost property values, it’s not clear that those have grown that fast in places where he won handily in 2016 (Getty; iStock) In July, President Trump announced that the Department of Housing and Urban Development would repeal an Obama-era rule requiring localities that receive federal funding to break down barriers to fair…

What four years of Trump has done for real estate

An assessment of how President Donald Trump affected real estate in terms of foreign investment, housing, taxes and general political sentiment. (Getty) Nearly four years ago, Donald Trump was sworn in as the nation’s first developer-in-chief, surrounded by prominent figures from New York City real estate. The sight of his industry friends on the national stage…

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November 11, 2020

Negotiating: Strategic Advantages of Backup Offers for Commercial Property Buyers

I regularly am in situations where a buyer is interested in some commercial property that is already under contract. It is the exception where I don’t recommend submitting a backup offer. There are two principal advantages to a buyer of submitting a backup offer in an effort to put a backup contract in place. Both are strategic advantages.

“This is the bottom line; win the game.” 

~Joe Namath

First, if the current active contract buyer does not close, then a backup contract becomes the active contract, knocking out competitive buyers before they have a chance to get started. The more sought after a property is, the more significantly this benefit is, but it is always a benefit as it only takes one buyer to knock you out of the process. Oh, by the way, that could be a backup offer being submitting while you’re thinking about it. Just saying…

Second, and I think more powerfully, a backup contract in place increases the likelihood of a property again becoming available as it tends to make a seller less likely to grant consideration or additional due diligence time, if asked.

Think about it. Imagine a buyer has been under contract with plenty of time for due diligence. The buyer asks for an extension of due diligence. If the seller only has people saying they’re interested – talk is cheap – then he/she might or might not grant the extension. If a firm backup offer is in hand, that same seller is much less likely to grant the extension.

Allow me to go one better, strategically. A backup buyer that really wants a property can make a hard offer, i.e. an offer with a non-refundable deposit or at least with some portion non-refundable. Why? A seller in a due diligence period will consider that differently than an offer with a new due diligence period. If you want to play to win, this is your best shot.

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Negotiating, Uncategorized
November 10, 2020

Miami Commercial Real Estate News November 4, 2020: Voters Reject Miami Beach Marina Redevelopment, Approve Wolfsonian-FIU Museum Expansion, and Other Election Results; More…

Voters decide South Miami, Surfside and Bal Harbour real estate referendums

Voters weighed in on South Miami zoning rules, Surfside public property sales and Bal Harbour building heights, producing mixed results from Tuesday’s election. South Miami A referendum in the city of South Miami failed to pass on Election Day, so zoning vote requirements will remain the same. South Miami Referendum 1 proposed replacing a unanimous five…

‘The Money Never Stops Coming’: Miami’s Office Market Is Hot, Despite Pandemic

Plenty of people have been speculating about the end of the office since the coronavirus spurred a work-from-home revolution. But Brian Gale, vice chair of Cushman & Wakefield of Florida, has been seeing something different. People have always come to Florida for sunshine and a lack of state income taxes, Gale said during a Bisnow webinar Oct. 20.

Pharrell Williams Is Opening A ‘Spiritual WiFi’ Hotel In Miami

Musician Pharrell Williams is teaming up with Miami nightlife king David Grutman and Dreamscape Cos. to open The Goodtime Hotel in Miami Beach. The 266-room property at 601 Washington Avenue will take up an entire city block, and will have a pool deck, a restaurant, a recording studio and 45K SF of retail. The seven-story property’s exterior was redone by…

Voters reject Terra’s proposal to redevelop Miami Beach Marina with condo tower

By a slim margin, city voters rejected Terra’s proposal to redevelop the Miami Beach Marina, replacing a commercial building anchored by Monty’s Sunset with a 38-story luxury condo tower. According to the final vote tally, 51 percent of Miami Beach’s electorate voted no on a ballot question asking residents to sell the air rights above the retail complex to Terra, which…

Miami Beach voters reject proposal to redevelop marina

Miami Beach voters rejected a proposal to redevelop the Miami Beach Marina but approved expansion plans for the Wolfsonian-FIU museum. Two other ballot questions allowing increases in FAR (floor area ratio or density) – one to incentivize restoration of historic buildings and another to incentivize bicycle parking and help property owners meet new building…

Real estate on edge with election too close to call

From an undisclosed location in Manhattan, billionaire developer and local radio host John Catsimatidis told New Yorkers that President Donald Trump’s chances of winning the 2020 presidential race looked good. “The betting line in Las Vegas is laying 3 to 1 for Trump to win,” he said on conservative talk radio station 77 WABC late Tuesday, while “manning…”

Miami Beach voters overwhelmingly approve Wolfsonian-FIU expansion

A super majority of Miami Beach’s electorate approved the Wolfsonian-FIU’s plans to expand its footprint on Washington Avenue, one of the city’s long forgotten retail streets that is now undergoing redevelopment. On Election Day, nearly 64 percent of city voters approved a ballot question asking them to increase the museum’s Floor Area Ratio, or FAR…

Suburban office demand spikes as working from home continues

Interest in small suburban offices is picking up as more people continue to work from home, and relocate outside of major urban centers. For IWG, the short-term office company, deals for its downtown New York offices have collapsed by 30 percent since the virus outbreak, while activity in southern Connecticut has surged more than 40 percent, according to Bloomberg.

Key Biscayne voters approve $100M bond tied to climate change

Key Biscayne Key Biscayne residents voted to pass a referendum that would allow the village to issue $100 million in general obligation bonds to deal with the effects of climate change. More than 56 percent of the roughly 6,100 voters in Key Biscayne approved the referendum in Tuesday’s general election. About $40 million could go toward mitigating the effects of sea…

JV developing Hialeah spec cold storage facility lands $67M construction loan

A joint venture developing a speculative cold storage project in Hialeah scored a $67 million construction loan. The joint venture between industrial developer Bridge Development Partners and PGIM Real Estate, the real estate investment and financing business of Prudential Financial, plans to break ground on the project later this month…

Miami Beach seeks to end tourism economic dependence

Miami Beach is a world-renowned tourist destination, but commissioners are hoping to shift the city’s economy away from dependence on this singular industry. Covid, Hurricane Irma and the Zika virus are just some events within the past 15 years that have put a damper on visitation dollars, Commissioner Mark Samuelian said at a meeting Friday, and the city…

Greenberg Traurig Assists Atlantic Pacific Communities with Master Ground Lease for Quail Roost Transit Village

Miami office Real Estate Practice Shareholder Nancy B. Lash and Land Development Shareholder Ryan D. Bailine assisted longtime client Atlantic Pacific Communities in obtaining approval for a 90-year master ground lease from the Miami-Dade County Commission to accommodate the building of mixed-use, transit-oriented development Quail Roost Transit…

PortMiami huge project spending list wins county OK

PortMiami projects costing Miami-Dade more than $301.5 million won OKs just two days before commissioners OK’d waiving up to $285.5 million for cruise lines crushed by Covid-19. Commissioners signed off last month on construction deals required by prior berthing and development pacts. Each came via competitive bid, Deputy Mayor Jack Osterholt wrote. The priciest…

Tim Schmand: Spurs Lincoln Road Business improvement district change

When Tim Schmand first visited Lincoln Road in Miami Beach in the 1980s, it was a far cry from the chic, artsy and bustling thoroughfare it is today. In fact, he said, it was largely abandoned. That didn’t stop him from exploring, learning about its every nook and cranny and developing an affinity for its unique aspects, ingenious and idiosyncratic alike. “It was just a magical…”

Buildings of Tomorrow: Future Warehouses

Amid this prolonged uncertainty, everyone agrees that the pandemic’s impacts are yet to be fully seen. Nine months in, the health crisis is about to trigger a global economic crisis, and real estate sectors are reacting differently—some trends, that were already underway, are accentuated, while others are disrupted completely from their original course. One of…

Real estate industry in suspense as election hangs in balance

The presidential election remained too close to call early Wednesday morning, leaving the future uncertain for the real estate industry. Polls in the final days before the election largely predicted Joe Biden would defeat President Donald Trump in what’s been one of the most divisive presidential races in U.S. history. But hours after polls closed, crucial…

Real estate pros say Trump better for market than Biden: survey

Asked if Donald Trump or Joe Biden would be a better president for real estate, many industry professionals surveyed by The Real Deal picked the president, but more in some cities than others — and not at all in Chicago. Some 465 brokers, executives, and others who make their living in the industry answered the survey question: “Which presidential candidate…”

Adding flavor: Badia Spices pays $44M for Sweetwater warehouse

Talk about mixing sugar and spice. Badia Spices bought a warehouse in Sweetwater for $44 million. The Doral-based spices and herbs manufacturer paid about $141 a square foot for the 313,000-square-foot building at 2200 Northwest 112th Avenue in Dolphin Commerce Park, according to a press release. It is the largest warehouse sale by both…

Core real estate funds delay investors from cashing out

Pension fund investors are seeking to take cash out of real estate funds as property values fall, like at Water Tower Place in Chicago (Photo via iStock; Wikipedia Commons) Pension fund investors are seeking to take cash out of real estate funds as property values fall, putting managers of those funds in a difficult position. More than 15 of the 25 open-ended “core” funds…

Integra, partner move forward with $58 million senior housing project in Allapattah

A partnership between a private equity group and a nonprofit broke ground last week on a 271-unit affordable senior housing project in Miami’s Allapattah neighborhood. Integra Investments and Elderly Housing Development & Operations Corp., or EHDOC, plan to invest $58 million to develop the 13-story building at 1396 Northwest 36th Street, according…

Americans stand united on one thing: NIMBYism

Political polarization is at a fever pitch, but Trump and Biden supporters seem to have found common ground on one issue: NIMBYism. Nearly 75 percent of U.S. residents oppose policies to increase housing density in their own neighborhoods, though more than half think the government should provide developers with incentives to build more housing. Opposition…

Mall owners CBL Properties and PREIT file for bankruptcy

The Covid-accelerated retail apocalypse has claimed two more victims. Mall owners CBL Properties & Associates and Pennsylvania REIT (PREIT) filed for Chapter 11 bankruptcy on Sunday, adding to the growing list of retail and mall owners that have faced a financial reckoning this year. Chattanooga-based CBL Properties first announced plans to file for bankruptcy in…

Covid survivor: Construction spending up from a year ago

Construction spending this year is up 4.1 percent from last year, according to new data for September. During the first nine months of the year, some $1.058 trillion has been put toward public and private construction, compared with $1.016 trillion for the same period in 2019. The housing sector powered the gain, though growth tapered off in September.

Wynwood nightclub building hits the market

A nightclub building in Wynwood is hitting the market, unpriced. Miami-based commercial brokerage Metro 1 has the listing for the property at 150 Northwest 24th Street. The sole tenant is the nightclub Rácket, according to a release. It is operated by Miami Beach-based Homecookin’ Hospitality Group, led by Angel Ferbes. The owner is HJK Holding, led by CEO…

Russell Galbut and partner launch blank check company, plan to raise $100M

Developer Russell Galbut and investor Michael S. Liebowitz formed a blank check company aimed at raising $100 million to invest in travel, hospitality, fintech, insurance tech, proptech and other industries impacted by the pandemic. The company, called New Beginnings Acquisition Corp. plans to sell 10 million shares priced at $10 each, according to a release. It joins a…

Open air windfalls: Shopping centers breeze past malls in their recovery

Since reopening in May, Miami’s Upper Buena Vista has seen its foot traffic surpass normal pre-Covid levels, according to the shopping center. And the mixed-use “pocket-village” with 21 stores, 12 of which have opened during the pandemic and five more that are slated to open soon, is now back to almost full occupancy. The increase in business for the 60,000-square…

Atlantic Pacific’s plan for mixed-use affordable housing project near Cutler Bay advances

Atlantic Pacific Communities’ plans for a mixed-use development near Cutler Bay, with at least 500 residential units including affordable housing, are moving forward. Miami-Dade County last week approved a 90-year master ground lease for a subsidiary of Miami-based Atlantic Pacific, led by CEO Howard Cohen. The development, called Quail Roost Transit Village…

Fed Releases Proposal for Community Reinvestment Act Reform, Seeks Comments

The Community Reinvestment Act (CRA) is a federal law that requires federally insured banks to meet the credit needs of people in their communities while meeting safety and soundness standards. At the time of its 1977 passage, lawmakers were concerned about unequal access to credit and policies such as redlining, especially in low-and moderate-income…

The impact of COVID-19 on U.S. states’ economic activity : State-level GDP data show the second quarter was much worse than the first

View on GeoFRED® GDP comes in various forms—for the nation as a whole and also for individual U.S. states. The map above shows the change in real GDP in each U.S. state for the first quarter of 2020. This was at the start of the pandemic, and some states were hit hard. The worst declines were in Louisiana (-11.91%), Delaware (-11.43%), Wyoming (-10.53%), Hawaii…

“We are erring on the side of having too much capacity”: Amazon reports massive Q3

How much capacity is too much? For Amazon, the limit doesn’t exist. At least not yet. The e-commerce giant — which has been adding warehouses at a dizzying clip across the nation — is on track to expand its fulfillment and transportation capacity by 50 percent, it said. The company has already spent $4.7 billion on property and equipment. The Jeff Bezos-led…

Creative Ways to Repurpose Abandoned Malls & Big-Box Stores After COVID-19

Many large retail spaces are sitting empty because of retailers going out of business, but there are novel strategies to reuse these spaces Although the struggles of shopping malls and big-box stores aren’t new, as eCommerce has been cutting into their sales for years, the COVID-19 pandemic has been the final straw for many retailers.

Denver-Based Company Pays $13.1M In Off-Market Industrial Acquisition

With a just-closed, off-market buy in Hialeah, Denver-based EverWest Real Estate Investors has expanded its strategy of investing and improving assets in prime industrial locations. Its latest purchase is located at 1101 E. 33rd St., an infill location in the heart of Miami’s Hialeah industrial submarket. EverWest purchased the 160,000-square-foot building for…

Pharrell, David Grutman partner with developer to launch South Beach hotel

Developer Eric Birnbaum brought on star power to launch his Washington Avenue hotel in Miami Beach. Singer-songwriter and producer Pharrell Williams and hospitality mogul David Grutman are partnering with Birnbaum on the Goodtime Hotel, a 266-room hotel on Washington Avenue between Sixth and Seventh streets, which is set to open early next year.

Bell Partners pays $94 million for two Boca Raton apartment complexes

An apartment investment and management company bought a pair of multifamily complexes in Boca Raton for a combined $94.25 million. An affiliate of Greensboro, North Carolina-based Bell Partners, led by CEO Jon Bell, bought the complexes at 5500 Broken Sound Boulevard and 950 Northwest Broken Sound Parkway, according to records. Built in 2018…

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November 4, 2020

Video: Stephen Ross Discusses COVID CRE Effects ~ CNBC Power Lunch

Stephen Ross, the chairman and majority owner of The Related Companies, a global real estate development firm he founded in 1972 that has been and continues to be very active in Miami, and owner of the Miami Dolphins, discusses reopening and the state of commercial real estate projects like Hudson Yards in New York in elsewhere. This discussion concentrates a lot on New York, but the discussion, much of which is him expressing opinions about that (in his opinion) and how we should be opening up the economy, could apply in Miami or anywhere.

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Economy
October 29, 2020

Video: How COVID-19 is Impacting Commercial Real Estate

In this video from Yahoo Finance, Doubleline Capital Portfolio Manager Morris Chen joins Julia La Roche and Zack Guzman of Yahoo Finance to discuss in some detail the latest commercial real estate outlook amid COVID-19. They talk about the variance in pain among various commercial real estate sectors as well as the offsetting positives of an extremely low interest rate environment. That the spread in cap rates to treasury rates has expanded, and what this might mean, is also discussed.

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Analysis
October 28, 2020

Miami Commercial Real Estate News October 28, 2020: Pics of Completed River Landing Development; 117 Acres Trade in Homestead; Projects Approved, Disapproved; More…

Photos Show the Massive $452 Million River Landing Project Now Complete

River Landing Shops & Residence, a massive mixed-use complex, is now open on the Miami River. It took nearly a decade to develop the project. Developer Urban-X Group first put the former Mahi Shrine Auditorium property where River Landing is located under contract in 2011. River Landing is a $452 million development with 2.2 million square feet…

$11.6M Sale of Former Newspaper Printing Facility in Metro Miami Arranged

Cushman & Wakefield has arranged the $11.6 million sale of the former Miami Herald Printing Facility in Doral. The three-story warehouse spans 118,993 square feet and features 15 dock-high positions, one grade-level ramp and clear heights from 10 feet to 46 feet. The property was built in 2013 and is situated at 3500 NW 89th Court, 14 miles west of downtown…

$23 Million Miramar Office Sale Brokered

Cushman & Wakefield has facilitated the $22.6 million sale of Miramar Tech Center, a 56,710-square-foot Class A office property in Miramar, Fla. Scott O’Donnell, Mike Ciadella, Dominic Montazemi, Greg Miller and Miguel Alcivar negotiated on behalf of the seller, United Data Technologies. The brokerage’s Jason Hochman secured a $13.6 million acquisition loan for…

Miami board again votes against a downtown Melo skyscraper

A Miami review board has unanimously recommended denial of plans for a skyscraper downtown from The Melo Group, advice the outgoing city planning director ignored for another Melo project that is now rising. The denial vote Oct. 21 is rare for the Urban Development Review Board, whose role is to advise the planning director. The latest Melo proposal…

Commercial Property Borrowing Cost Quarterly 2020 Q3: 5-Year Treasury Remains Naught-y

Yields on 5-year U.S. Treasury Notes continue to remain at lows reached as we began the era of COVID. As can be seen in the chart above, these rates, most closely tracked for commercial real estate financing cost, plummeted from what were already considered low levels to under 50 basis points (0.5%), barely hovering over zilch, where they have been since. Though…

Atlanta Fed: Beige Book Finds Slow Improvement but an Economy Still Lagging

A now-familiar pattern—economic growth picking up but still below pre-COVID levels—prevailed across the Southeast over the past several weeks. But two new factors joined the pandemic to hamstring commerce, as Hurricanes Laura and Sally disrupted energy production and transmission and damaged crops, farming infrastructure, and property across coastal…

Chart: August Miami-Dade Unemployment Level Reaches Lowest Level Since March

From its peak of 14.5% reached in only the prior month, the unemployment rate in Miami-Dade county plummeted in August (8/1) to 8.1%, the lowest level since March when unemployment had jsut started to creep up but was still in low single digits (3.7%). The continuing effects of COVID-19 on employment, and thus the economy, in the Miami area continue can be…

Saks Fifth Avenue Lender Looks To Foreclose On Miami Store

The pandemic has pounded traditional retailers. Landlords and lenders involved with properties ranging from large malls to urban shopping areas are sizing up their options — and some are playing tough. Lenders to the Saks Fifth Avenue store at Miami’s Dadeland Mall are foreclosing on its owner, The Wall Street Journal reported. The owner defaulted in April…

South Florida by the numbers: 2020 presidential election and real estate

“South Florida by the numbers” is a web feature that catalogs the most notable, quirky and surprising real estate statistics. You may know that Election Day is Nov. 3. (With all kidding aside, however, will we know who is the winner by the next time this column is published?) Some pundits are predicting a close and heavily contested election, with the added…

Biscayne Boulevard residential tower with grocery wins OK

A large development bringing together more than 500 residential units and a major grocer has garnered a positive vote. Crescent Heights of America Inc. and its affiliated entities propose 2900 Biscayne, a 38-story mixed-use tower on land at 2900 Biscayne Blvd., and the city’s Urban Development Review Board unanimously recommended approval. The site is at 2900…

Poor hospitality: Hotel owners in big cities hit major tipping point

All of the lights in the Hilton Times Square have been pitch black for weeks — one of several ominous signs for hotel owners in New York and other large cities around the country. The owner of the 478-room property, just blocks away from Broadway and Bryant Park, disclosed plans to the state’s Labor Department last month to permanently shut its doors and lay off…

Supreme Court shift could favor rent law challengers

When landlord groups filed a federal lawsuit challenging New York’s rent law last year, they already had their eyes on the U.S. Supreme Court. Now, with the appointment of a sixth conservative judge, their case may have a better shot at being heard by the nation’s highest court. Amy Coney Barrett was sworn in Monday night as the 115th justice in the court’s history. 

Miami-Miami Beach ferry service ‘at one-yard line’

Poseidon Ferry LLC, soon to offer daily waterborne commuter transportation between Miami and Miami Beach, will officially launch with an evening Music Cruise on Nov. 6, said CEO Johnathan Silva. The company’s core business, commuter service – still in the doldrums of permitting – should follow soon. “We’re at the one-yard line right now…”

Super Bowl economic impact touches down at $571 million

Fueled by shrinking supply and rising demand, Miami-Dade single-family home sales are close to a buying frenzy, with median sale prices increasing for 106 consecutive months and rising 15.2% in the year that ended Sept. 30, figures from the Miami Association of Realtors show. The average single-family home now sells for $435,000, September figures show. The hottest…

Cross-bay transit is vital, but blank-check deal is all wrong

Miami-Dade made a costly bet plopping down $8 million for designs of a multi-billion-dollar monorail in a deal with a global firm whose true interest is a mammoth gambling resort. The consortium that includes Malaysian casino mogul Genting aims to build a monorail linking Miami to Miami Beach and then operate it. But taxpayers would repay the group…

Life Time launches preleasing of $500M Coral Gables mixed-use multifamily project

Life Time launched preleasing of a major mixed-use multifamily development in Coral Gables that will include a 70,000-square-foot athletic resort and a 22,000-square-foot shared workspace component. Nolan Reynolds International is set to complete the $500 million, 1.2 million-square-foot project previously known as Gables Station. Life Time is…

Miami developer sued for running boat over Biscayne Bay swimmer’s leg

A Miami real estate developer is facing allegations that he ran over a swimmer with his boat in Biscayne Bay near Bay Harbor Islands, slicing her leg and causing permanent injuries. Theresa Murray filed suit in Miami-Dade Circuit Court Court on Monday, alleging that Irwin Tauber’s 41-foot boat’s three bladed stainless steel propellers sliced her leg and ankle…

Miami Developer Maimed Swimmer In Yachting Accident, Lawsuit Says

A Miami woman alleges that shopping center developer Irwin Elliott Tauber ran over her with his yacht in Miami’s Biscayne Bay in April, causing serious injury to her extremities. He also allegedly refused to render first aid. Tauber is the CEO of Taubco, which owns Causeway Square, an LA Fitness-anchored mixed-use building at the corner of Biscayne Boulevard…

Here are the most active players in the loan workouts space

Barneys’ former space on Madison Avenue was hanging by a thread. A $76 million balance on the building’s debt, which Ashkenazy Acquisition took out in 2010, was set to mature in July. And after Barneys filed for bankruptcy and shut down all of its stores this February, Ashkenazy was forced to tap the retailer’s letter of credit to make debt service payments…

Homestead Park of Commerce Sold for $35M to Copart USA

October 2020 – ComReal is proud to announce the sale of 117 acres within The Homestead Park of Commerce in South Dade and welcome Copart USA to the City of Homestead! The sales price was $34,746,716. Copart was represented by the ComReal team including Ed Redlich, Ron Redlich, Chris Spear, Edison Vasquez, Mort Fetterolf and Patrick McBride. The seller…

When the music stops: Guitar Center could file for bankruptcy

The music could stop at Guitar Center in the near future. The retailer is preparing for bankruptcy after missing a $45 million interest payment on its debt, the New York Times reported. The company has reached out to creditors to explore a plan where it could emerge from bankruptcy in 2021. The possibility of bankruptcy comes after Moody’s and S&P downgraded…

Does taxing the wealthy really drive them away?

This year’s spring housing market came a couple of months later than usual to the leafy suburbs of New Jersey. But it was worth the wait. Michele Kolsky-Assatly, a veteran agent with Coldwell Banker focused on Bergen County’s luxury market, has been busier than ever with the exodus of families from New York City. “They never want to be locked up in a high…

Macken wins approval for North Miami Beach townhomes

Macken Companies Principal Alan Macken and a rendering of the project North Miami Beach-based developer Macken Companies received site plan approval for a waterfront townhome community in the city’s Eastern Shores neighborhood. The company hopes to break ground on the 10-unit Koya Bay, along the Intracoastal Waterway at 4098 Northeast 167th…

Abandoned malls get new life as senior housing

As more malls and shopping centers close or see their anchor tenants fall into bankruptcy, they may be repurposed for a new use: senior housing. George and Pat Ritzinger are among the early beneficiaries of the trend: The couple moved to Folkestone, a retirement community in Wayzata, Minnesota, developed on land that formerly housed a shopping mall built…

Blackstone makes $1.2B deal with Brookfield for Simply Self Storage

Blackstone Group is buying Simply Self Storage from Brookfield Asset Management for about $1.2 billion, Bloomberg reported. Brookfield bought the storage company in 2016 and has more than doubled its footprint; it now has more than 8 million square feet of space across the U.S. It started seeking buyers for the company earlier this year. With this deal……

Jules Trump talks luxury towers and assembling in Sunny Isles Beach in TRD’s Coffee Talks

In excess-loving South Florida, there’s always room for more — more mansions on the waterfront, more luxury penthouses, and more Trump. TRD‘s latest episode of Coffee Talk includes just one Trump. Not Donald, not Eric or Don Jr., but one whose name South Florida industry experts know just as well — South African-born developer Jules Trump. Though he…

The metamorphosis of the metropolis

After years of sparring over its highest and best use, the fate of 5 World Trade Center was left to a competition. The Port Authority of New York and New Jersey and the Lower Manhattan Development Corp. last year announced what was effectively a truce: The agencies would consider both residential and commercial visions for the site. Among them were…

Covid pummeled shopping centers, but their parking lots are thriving

While many traditional streams of income for landlords have slowed or dried up due to the pandemic, one has proven to be a surprising earner: parking lots. Landlords of large parking lots and garages have been renting out those spaces for a variety of activities, including open-air retail, job fairs, polling stations and drive-through COVID-19 testing, the Wall Street…

Kendall Corners Florida Retail Shopping Center Gets a New Tenant, Aldi

Key Points Regarding the New Aldi Lease in Kendall Corners MMG acquired the Kendall Corners retail center in March 2017.  The Kendall Corners’ original business plan included replacing Ashley Furniture with a grocer upon their lease expiration in 2020, as a means to incorporate more grocery-anchored retail centers to the portfolio. Ashley Furniture…

Active South Florida Lender Bank OZK’s lending up in third quarter

New York’s commercial real estate market has been pummeled by the pandemic, but one of its biggest condo construction lenders reported almost no write-downs in the third quarter. On its earnings call Friday, Arkansas-based Bank OZK reported that its net charge-off rate, or ratio of loans written-down to total loans originated, was 0.09 percent. That is well……

Do over: North Miami Beach to re-vote on Dezer’s plan to redevelop Intracoastal Mall

Dezer Development will return to the North Miami Beach commission for a re-vote on two ordinances tied to the contentious redevelopment of the Intracoastal Mall, despite securing approval earlier this week. In the Zoom commission meeting on Tuesday that ended after 2 a.m., two commissioners were absent for the vote. Still, the two ordinances passed…

MG3 buys former Miami Herald printing facility for $12M

Miguel Alcivar, Wayne Ramoski, Gian Rodriguez, Dominic Montazemi and Skylar Stein of Cushman & Wakefield MG3 Group, an Aventura-based private real estate company, bought the former Miami Herald printing facility in Doral for $11.6 million, a $2.3 million loss from its previous sale in 2016. Records… the three-story warehouse at 3500 Northwest 89th Court.

Eight stats tell the tale of Adam Neumann’s rise, fall, and return

Alfred CEO Marcela Sapone and Adam Neumann Adam Neumann is back. In his first venture since leaving WeWork last year, the eccentric and brash Israeli entrepreneur is investing $30 million in Alfred, a “future of living” startup that provides apartment services such as dog walking, maintenance and rent processing, according to Bloomberg. Neumann’s family…

At final presidential debate, talk of Opportunity Zones and “little tiny windows”

At Thursday’s presidential debate, there was less interrupting and more real-estate related discussion. The event marked the final faceoff between President Donald Trump and former Vice President Joe Biden before Election Day. Housing was only briefly acknowledged in the first debate, which devolved into more of a shouting match than polite discourse.

Gap Inc. will close 350 stores and exit malls entirely

Another big retailer is leaving struggling malls behind. Gap Inc. announced Thursday that it will close 350 of its stores —220 of its namesake Gap shops, and 130 Banana Republic outposts — by early 2024, ABC News reported. Eighty percent of its remaining stores will be in off-mall locations, according to ABC News. “We’ve been overly reliant on low-productivity…

South Florida industrial market shows signs of weakness in Q3

South Florida’s industrial market — believed to be resilient to coronavirus as demand for distribution space and cold storage grows with online shopping — did show some signs of weakness in the third quarter, according to a newly released report. In Palm Beach County, 350,000 square feet of industrial space was…

Sold! Online auto auctioneer pays $35M for Homestead land

Going … going … gone. A publicly traded provider of online car auctions paid $34.75 million for 117 acres of land in the Homestead Park of Commerce. Copart USA, founded in 1982 and based in Dallas, bought the land at Southeast 36th Avenue and Southwest 336th Street. The site includes a 32,453-square-foot Class A distribution warehouse, according to a…

Rent collections in market-rate apartments stagnate in October

Rental payments for market-rate apartments are holding steady from September, but down slightly from last year. The National Multifamily Housing Council’s monthly payment tracker, which collects data on collections in 11.4 million market-rate units, found that 90.6 percent of those households paid some rent by Oct. 20. In 2019, about…

Miami board approves plans for Related, Crescent Heights towers and rejects Melo’s proposal

A city of Miami board rejected plans for Melo Group’s latest downtown Miami project, and approved plans for separate projects from Crescent Heights and the Related Group. On Wednesday, the Miami Urban Development Board unanimously approved Crescent Heights’ 38-story tower at 2900 Biscayne Boulevard and a 37-story mixed-use project at…

Sunny Isles mayor sells Hialeah warehouse for $13M

A company tied to the mayor of Sunny Isles Beach and a fellow South Florida real estate investor sold a 160,000-square-foot warehouse in Hialeah for $13.1 million. George “Bud” Scholl, elected mayor in 2014 and re-elected in 2018, and investor Steven M. Rhodes sold the industrial building at 1101 East 33rd Street, The Real Deal has learned. EverWest Real Estate…

Logistics Company Relocates. Inks New 93,000-SF Lease Deal

IFS Neutral Maritime, a consolidation, cargo and logistic company, inked a 7-year lease deal for 93,320 square feet at Turnpike Commerce Center (TCC) located at 1350-1400 NW 121st Avenue in Doral, with plans to occupy the building in its entirety in January 1, 2021. The deal closed October 7. Hector Catano, president of Cornerstone International Realty, represented the…

Midtown Capital Partners buys Miramar office center for $23M

A Miami real estate investment and asset management firm bought the Miramar headquarters of an information technology company for $22.6 million. Records show Midtown Capital Partners bought the Miramar Tech Center at 2900 Monarch Lakes Boulevard. A company affiliated with United Data Technologies, or UDT…

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October 28, 2020

Commercial Property Borrowing Cost Quarterly 2020 Q3: 5-Year Treasury Remains Naught-y

U.S. Treasury 5 Year Nominal Rates for the Five Year Period Ending September 30, 2020

Yields on 5-year U.S. Treasury Notes continue to remain at lows reached as we began the era of COVID. As can be seen in the chart above, these rates, most closely tracked for commercial real estate financing cost, plummeted from what were already considered low levels to under 50 basis points (0.5%), barely hovering over zilch, where they have been since. Though borrowing costs have not followed this point for point, they’re nonetheless lower.

This low interest rate environment is powerful for real estate as an asset class. There are of course ongoing concerns about vacancy rates and rent growth in a slower economy, but lower interest rates mean a lower cost of capital. Plus, real estate income becomes relatively more attractive to fixed income investments. Vacancy and rent growth effects remain unknown, but lower interest rates are known – now.

The interest rate environment has the ability to affect commercial property economics in a number of different ways (see this and this). Borrowing costs are, of course, affected directly, as higher interest rates increase the cost of borrowing and thus negatively affecting demand. Cap rates tend move over time with interest rates, but not in lockstep, with considered analyses generally concluding that capitalization rates on average move in the same direction as 10-year rates, but only about a third as much, and again not in lockstep. Interest rates also affect the economy, which in turn affects vacancy and rental rates.

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Economy, Financing
October 22, 2020

Miami Commercial Real Estate News October 21, 2020: Feasibility Study Approved for Monorail to Miami Beach; Sunny Isles, Medley Warehouses Trade; Office Rents Set Record; More…

South Florida Q3 office rents hit record high, despite higher vacancies

Despite record high office vacancies across South Florida, average asking rates hit new highs Despite record office vacancy rates across South Florida, average asking rents hit new highs in the third quarter, according to a newly released report. Miami-Dade had the highest average asking rate, at $41.68 per square foot, according to the report from Colliers International…

Miami Commercial Real Estate Sales to List Price Ratio Trails Off in September to Five Year Low ~ September 2020 MLS

The sales to list price ratio as reported by the Miami MLS for improved commercial property in Miami-Dade County from $1 million to $10 million dipped in September. September’s recorded ratio of 86.3% is the lowest level recorded since February 2015’s 84.9% number. This follows a dip two months prior that, though a slightly better number was itself then the…

Here’s What Could Happen To The EB-5 Program In A New Administration

The EB-5 immigrant investor program, which has been used to fund major development projects throughout the United States, has been limping along for the past few years, and some have even predicted its demise after rules were tightened last summer. How might the program, which awards U.S. green cards and visas to foreigners who put a minimum of $900K into…

Sunny Isles mayor sells Hialeah warehouse for $13 million

A company tied to the mayor of Sunny Isles Beach and a fellow South Florida real estate investor sold a 160,000-square-foot warehouse in Hialeah for $13.1 million. George “Bud” Scholl, elected mayor in 2014 and re-elected in 2018, and investor Steven M. Rhodes sold the industrial building at 1101 East 33rd Street, The Real Deal has learned. EverWest Real Estate…

Honeywell warehouse in Medley sells for $8M

South Florida real estate investor Leo Ghitis sold a warehouse near Medley for $7.5 million. Ghitis sold the nearly 50,000-square-foot building at 9315 Northwest 112 Avenue on 3 acres of land inside Flagler Station Industrial Park, according to records. The price equates to about $152 a square foot. The buyers are entities that share an address with Midtown Capital…

Miami Beach based Starwood scores $265M refi for portfolio of InTown, Uptown hotels

Starwood Capital Group secured $265 million in refinancing for a portfolio of 58 extended-stay and midscale hotels nationwide, representing a fraction of all the hotels it owns and operates. Miami Beach-based Starwood hopes to execute the first lien mortgage about Oct. 28, according to a report from Kroll Bond Rating Agency. Starwood will use the funds to pay off existing…

Seritage sells Hialeah shopping center for $21M

Seritage sold a 108,000-square-foot shopping center formerly anchored by Kmart in Hialeah for $21 million. A Daytona Beach-based publicly traded real estate company, CTO Realty Growth, bought the shopping center at 1460 West 49th Street, records show. The company changed its name from Consolidated-Tomoka Land Co. to CTO in May. The sale equates to $194 psf…

Rental project in MiMo District launches leasing

The developer of the American Legion property in Miami’s MiMo District launched leasing of the first phase and plans to break ground on the second phase next year. Private equity firm Asia Capital Real Estate, also known as ACRE, and QuadReal Property Group, the real estate investment arm of the British Columbia public employees’ pension, completed the first phase…

In “Billion Dollar Loser,” WeWork’s “epic rise” and Adam Neumann’s quiet enablers

Real estate executives had their doubts about WeWork, but many weren’t willing to risk missing out on its success. They and others who kept their criticism to themselves helped enable and then felled the co-working giant once it became clear that its crash would be just as extraordinary as its ascent. “They couldn’t explain WeWork’s valuation, but they were fearful…

10,566 SF Office Sublease Negoitated at Brickell City Centre

Cresa has negotiated a 10,566-square-foot office sublease for Pillsbury Winthrop Shaw Pittman LLP (Pillsbury) in Miami’s Brickell City Centre. Pillsbury, which focuses on the technology and media, energy, financial services, and real estate and construction sectors, has occupied the space at 600 Brickell Ave. since 2017 and will now lease the space until at least…

Dezer’s mega development project gets key approval

A rendering of the project with developer Gil Dezer Dezer Development’s plan to redevelop the Intracoastal Mall property into a massive mixed-use project cleared another hurdle. North Miami Beach commissioners approved ordinances for the complex on second reading in a 3 to 2 vote early Wednesday morning. Two commissioners were not present for the…

Edgewater-Midtown tower residences win Miami’s backing

A mixed-use residential development is being proposed for the area where Edgewater meets Midtown in the City of Miami, and not far from Wynwood. Called 27 Edgewater, the planned 18-story building would rise at 2728 NE Second Ave. and be home to 108 dwellings. The project by developer 908 Group Holdings LLC was recently reviewed by the city’s…

Rents fall in cities around the world

Across the country, rents are tumbling. Sales have surged in the New York suburbs, and prices with them. But Manhattan apartments are the cheapest they’ve been since 2013. The number of listings have tripled from a year ago while the median rent has dropped 11 percent, according to Bloomberg. Expensive cities have taken the biggest hit. In San Francisco, the median…

Jorge Pérez steps down as president of Related Group, handing title to son Jon Paul

Jon Paul Pérez was named president of the Related Group, taking over from his father, Jorge Pérez. Jorge, who founded the Miami-based real estate giant in 1979, will stay on as chairman and CEO when Jon Paul takes over in November, according to a release. Billionaire developer Jorge Pérez, known as the Miami condo king, has spoken about his succession plan in the past.

Blackstone Move Solidifies Miami Mayor’s Vision For A Global City

The dream of Miami Mayor Francis Suarez to have the city turn into a global destination for talent and investment is coming to fruition. Blackstone, a private equity investment firm, has set its sights on opening a Miami outpost as the nation’s largest investment managers continue to migrate to South Florida. Its plans surfaced as the city is in…

PortMiami dredging may rest on economic future of cruise lines

PortMiami continues to plan for more dredging, pandemic or not. As the coronavirus has plagued both Miami and the rest of the nation, there has been an increased focus on cruise ship travel and economic recovery.  Last year, Miami-Dade County commissioners authorized a three-year study. Now, after about a year and a half, US Army Corps of Engineers project…

Things To Consider When Leasing To A Medical Marijuana Dispensary

Some essential CRE steps when leasing to an essential business At the height of lockdowns and quarantines, it quickly became apparent that what was considered essential expanded far beyond first responders and hospital staff. Truck drivers working long shifts to get goods to supermarkets, and the employees stocking shelves with those products quickly rose to…

Can Proposed Seawalls Protect Miami From Storm Surges?

The Magic City could see walls become a permanent part of the downtown area if an Army Corps of Engineers plan comes to fruition Downtown Miami has one of the planet’s most spectacular coastlines, featuring buildings that seemingly jet from the ocean as you approach from the air or water.  This beautiful location comes with…

Bus Rapid Transit has inside track in East-West Corridor

After nearly three decades of studies, local transportation decision-makers are set – again – to choose a mass transit upgrade for a 14-mile commuting route linking West Miami-Dade to Miami International Airport and downtown Miami. Today (10/22), the Miami-Dade Transportation Planning Organization Governing Board is to vote on a preferred transit mode for…

Sandor Scher: Set to bring hotel, condos, retail to Beach’s Ocean Terrace

For almost two decades, Sandor Scher’s Claro Development has advised on more than 100 projects in over 60 cities, adding nearly 2,500 hotel rooms in South Florida and, according to firm figures, delivering more than $750 million of hospitality, commercial and historic restoration development. His entrée into real estate came through a restaurant startup that over 6½…

Miami-Dade approves interim contract for monorail to Miami Beach

A rendering of the monorail Plans for a monorail between the city of Miami and Miami Beach took a step forward on Tuesday. In spite of calls for a deferral from Miami Beach, the Miami-Dade County Commission approved a contract of up to $14 million with Genting Group and Meridiam Infrastructure North America Corp. to study the feasibility of building…

The REInterview: Reeves Wiedeman on the manic rise and fall of Adam Neumann and WeWork

Dream no small dreams, for they have no power to move the hearts of men — or venture capitalists. Adam Neumann, the co-founder and former CEO of WeWork, certainly wasn’t guilty of small dreams. From being a broke émigré living rent-free in his sister’s apartment to building one of New York’s largest real estate companies to becoming the head of one of the…

Related, Crescent Heights and Melo Group seek approval for Miami projects

The Related Group, Crescent Heights and the Melo Group are seeking approval from the Miami Urban Development Review Board for projects in downtown Miami and Edgewater. Related and its partner, ROVR Development, led by Oscar Rodriguez and Ricardo Vadia, are proposing The District at 225 North Miami Avenue in downtown Miami. The 37-story…

Mezz lender forecloses on Ocean Drive hotel in South Beach

The pandemic brought especially bad timing for the owner of a South Beach hotel, which purchased it last year, embarked on a multimillion-dollar renovation, and ended up losing its investment. Leste Group and its partner, Moto Capital Group, last month foreclosed on the newly renovated Lord Balfour Hotel at 350 Ocean Drive, The Real Deal has learned. The,,,

Former Uber CEO Travis Kalanick cooks up a real estate empire

Uber co-founder and ex-CEO Travis Kalanick has quietly amassed a real estate empire over the past two years. Companies tied to Kalanick’s CloudKitchens, a startup that rents available space to food delivery businesses, have snapped up more than 40 properties across the country for more than $130 million, the Wall Street Journal reported. Kalanick’s…

AMC faces serious cash crunch despite theaters reopening

Movie theaters are reopening across the country, but that may not be enough to save some of the biggest cinema operators. AMC Entertainment Holdings, one of the world’s largest movie theater operators, said it could run out of cash by the end of the year if it can’t find additional sources of liquidity, Reuters reported. The company said…

Buying distressed debt to get the underlying property – a litigation due diligence checklist

It’s beyond the scope of this blog to predict where the commercial real estate market is heading, but there are those who have predicted a downturn. If that turns out to be right, there may be more loans than usual going into default. If you are considering buying a commercial note that is in default because you ultimately want to foreclose to buy the property…

New York’s CRE woes could spread nationwide: investors

Investors are betting that trouble in New York City’s commercial real estate market will spread nationwide. Prices for debt backed by hotels, restaurants and retail in New York City — among the hardest-hit sectors as the pandemic emptied out tourist destinations this year — have fallen and new loans have slowed…

Here’s what tenants are paying at Shops at Merrick Park

Brian Kingston and Merrick Park Nordstrom and Neiman Marcus may be closing stores across the country amid the pandemic, but at the Shops at Merrick Park in Coral Gables, the retailers appear to be in for the long haul. Brookfield Property REIT owns the roughly 850,000-square-foot property at 358 San Lorenzo Avenue, which consists of a three-story open-air…

Family foundation pays $5M for land in Miami Shores, plans private Jewish school

Jamie Rose Maniscalco and Daniel Ades with the property A family foundation paid $5.3 mil… The Ades Family Foundation, the philanthropic arm of Aventura-based Kawa Capital Management’s managing partner and chief investment officer Daniel Ades, bought the assemblage at 855, 975 and 995 Northwest 95th Street and at 900, 910 and 920 Northwest 96th Street.

Building up: Homebuilder confidence hits new highs

Homebuilders are feeling record levels of optimism, according to a new report. The National Association of Home Builders Housing Market Index reached 85 in October, seasonally adjusted, the highest reading in the monthly metric’s 35-year history. After experiencing a sharp decline in the spring, the NAHB index has been steadily rising — and…

How Does the Pandemic Recession Stack Up against the Great Depression?

Many observers have been comparing the COVID-19-induced recession with the Great Depression. An Economic Synopses essay published in August examined some key economic indicators during these contractions to consider their severity and duration. Group Vice President and Deputy Director of Research David Wheelock explained that the Great Depression…

Aventura office complex Optima inks new leases

Four companies signed leases for a total of 36,000 square feet at Optima, a three-building office complex in Aventura, including the first tenant of the complex’s 28-story tower that is still under construction. Blanca Commercial Real Estate, which brokered the deals, declined to disclose lease terms for space at the complex at 21500 Biscayne Boulevard.

Ransom Everglades sues developer Caroline Weiss over backyard boat dock

A pop-up private marina behind a commercial developer’s home in Coconut Grove is disrupting Ransom Everglades’ aquatic learning experiences, according to a recently filed lawsuit. The private school is suing Caroline Weiss, CEO of the Weiss Group of Companies, in Miami-Dade Circuit Court, in an attempt to stop her from allowing private boats from docking along…

State Of South Florida Commercial Real Estate Discussed

Paul Marko was recently appointed as principal of the South Florida Avison Young team, and he applied his 30 years of experience in office tenant representation, buyer broker services and portfolio administration to answer some questions about the South Florida and national commercial real estate markets.

“There’s a lot of money to be made”: IRS targets foreign real estate investors

The Internal Revenue Service is going after foreign real estate investors as part of a broader sweep to collect revenues amid the pandemic.  In the past month, the Internal Revenue Service has announced two new audit campaigns targeting overseas investors who own or hold interests in U.S. property. The campaigns focus on foreign investors selling their interests…

Fontainebleau Miami Beach’s $1B loan exits special servicing

Miami-Dade County’s largest resort is no longer in special servicing. The $975 million commercial mortgage-backed securities loan for Jeffrey Soffer’s Fontainebleau Miami Beach returned to the master servicer on Sept. 23 following successful negotiations with lenders, according to Trepp data updated this week. The loan was transferred to the special servicer…

Unibail-Rodamco sues Express over $30 million in missed rent

Act of God? Mall operator Unibail-Rodamco-Westfield said its lease agreements with Express cover such events, and still require the retailer to pay the rent. Now Unibail is suing Express, saying the retailer owes $30 million in skipped rent across 27 locations throughout the U.S. Fourteen of those stores are in malls in California, according to the suit, filed in Los…

Mast Capital wins initial approval for shorter Mid-Miami Beach condo project

Developer Camilo Miguel Jr. won initial approval for a shorter, 85-foot tall version of his planned 4000 Alton Road condo project in mid-Miami Beach. The Miami Beach City Commission on Wednesday passed on first reading three ordinances that will enable Miguel’s Mast Capital to build an 85-foot tall building with as many as 216 units. The proposal will be heard once…

Miami Beach approves zoning change allowing for Aman tower

Miami Beach commissioners approved a zoning change that would allow billionaire developers Vlad Doronin and Len Blavatnik to build their Aman-branded tower. Commissioners Steven Meiner and Micky Steinberg voted against the Faena district overlay ordinance on second reading, which will allow the developers to build a 250-foot tall tower, up from the previously…

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Top Stories
October 21, 2020

Chart: August Miami-Dade Unemployment Level Reaches Lowest Level Since March

Miami-Dade County, Florida Unemployment Rate Year Ending August 1, 2020

From its peak of 14.5% reached in only the prior month, the unemployment rate in Miami-Dade county plummeted in August (8/1) to 8.1%, the lowest level since March when unemployment had jsut started to creep up but was still in low single digits (3.7%). The continuing effects of COVID-19 on employment, and thus the economy, in the Miami area continue can be seen, to be sure, but this is improvement, considerable. Though there is a new surge in infections, we seem to be figuring out how to navigate all this, thus hopefully any future effect will at least be muted.

Here’s hoping.

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Economy
October 21, 2020
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