Month: March 2021

When considering changes or potential changes in commercial real estate capitalization rates (cap rates), market participants tend to most commonly think of interest rates. However, rent growth assumptions also affect cap rates as the more one expect earnings to grow over time the less return an investor is willing to accept now. This is just like growth stocks in the financial markets, the higher a growth ratio the higher the PE (and thus the lower the earnings yield, a calculation for companies essentially equivalent to a cap rate). I know this intuitively, and commonly mention it to commercial real estate investors coming from other markets with lower assumed and historical rent growth; “cap rates are lower here as rent growth assumptions are higher.” I find it is generally not discussed – almost never, actually – by most market participants, but one can nonetheless see such effects in pricing. In writing this article I’m taking my first stab at quantifying the math of it. Here goes.

In the above I’m attempting to quantify a ratio is between rent growth and cap rates. I’ve done this by calculating how much lower a price would need to be assuming 0% rent growth (scenario C) to have the same IRR as if the rent growth rate was 2% for a purchase made at a 5% cap rate. Then, the implied cap rate for the lowered price (scenario C priced lowered to match IRR of scenario A) at purchase is calculated, then the difference in these two cap rates, then the ratio between the difference in rent growth (2%) and this cap rate differential (1.35%). This arrives at a ratio of -68.51%. In other words, according to this calculation, for every 1% change in rent growth assumption, the cap rate should decrease by .69%.

Let me say this ratio is bogus, then add that it is not. First, I’ve never seen this calculation done in practice, thus it seemingly isn’t actively considered, though the effects surely come into play for more sophisticated buyers doing long-term projections. Second, there are numbers of variables that could affect this. Taxes and their effects on investor decisions are ignored in the above, as are transaction costs. Plus, there is nothing magic about the twenty years I’ve chosen above. Change this to a shorter or longer period and everything moves. Finally, improved real estate over a long period of time tends to depreciate to land value, which is evidenced incrementally as cap rates steadily increase as a property ages (and drops in class). That effect is ignored in this. Thus, this is somewhat bogus. However, it isn’t in that it is a calculated measure of the effect on IRR of rent growth, and the adjustments necessary to make returns in the form of IRR equivalent and the resultant affect on cap rates as a ratio of rent growth. What I want to illustrate is not an exact effect, but that there is an effect and that it is not inconsequential. It is not the exact ratio that is valid, it is the general effect.

In practice, I would mark this ratio down to “something approaching half.” This not only serves to pull away some of the effects on IRR of rent growth that are noted in the prior paragraph, it also matches my personal observations as an active market participant. This exercise has provided me me with one calculated mathematical ratio, using a method, likely not nearly the most elegant, of surely many others. In the past, I’ve generally noted that rent growth rates in Miami tends to be assumed to be higher than many markets, and that drives down our cap rates. That is more than what most of my competitors would say, but still just a general approximation that, not adequately substantiated, likely tends to go ear to ear nonstop and out of a listener’s mind without registering. Now, having gone through this exercise, I’m comfortable tightening this general statement to something like: the longer term IRR calculations indicate that cap rates should drop by about half a point for every percent higher rent growth assumed. Much better. Love it.

Note: Do me a favor and check my math. This spreadsheet was put together quickly, thus there could be a formula error within. This wasn’t super complicated and the result was not out of line with what I would expect, thus I didn’t fine-tooth-comb review it. If you find an error in these calculations or with my logic in general, let me have it.

Any and all facts, statistics, financial information, specifications, and analysis provided are on a best efforts basis only, and should not be relied upon for making real estate or investment related decisions. Nothing in this post should not be relied on for, tax, legal or accounting advice.

The post Quantifying the Effect of Rent Growth Assumptions on Commercial Real Estate Cap Rates appeared first on Hawkins Commercial Realty.

Blackstone buys MiamiCentral office buildings for $230 million

Blackstone Group paid about $230 million for the office buildings at Brightline’s MiamiCentral station, marking one of the largest investment sales to close in South Florida this year. Funds managed by New York-based Blackstone Real Estate bought 2MiamiCentral and 3MiamiCentral from San Francisco-based Shorenstein Properties, according to a news release….

Shorenstein Properties Sells Miami Office Complex for $230 million

Shorenstein Properties, a privately owned investment firm with offices in New York City and San Francisco, has sold 2 & 3 MiamiCentral, a 320,000-square-foot office complex in the city’s downtown area. A fund backed by Blackstone purchased the property for $230 million. Constructed in 2018, the two-building complex is located within MiamiCentral, a transit…

Blackstone Expands in Miami With $230 million Office Buy

On the heels of Blackstone signing a 41,000-square-foot lease for its tech team at the recently constructed 2 MiamiCentral in Miami, funds managed by Blackstone Real Estate have purchased the entire asset along with the neighboring 3 MiamiCentral. Shorenstein Properties sold the pair of downtown office buildings for $230 million. According to…

Blackstone Drops $230 million On 2 Miami Buildings

San Francisco-based Shorenstein Properties announced Friday that it sold two high-profile Class-AA office buildings in downtown Miami to funds managed by Blackstone Real Estate for $230M. MiamiCentral is a mixed-use, transit-oriented development project that spans six city blocks. The train station was designed to accommodate Brightline private trains and…

Shorenstein Properties Sells 2 & 3 MiamiCentral to Funds Managed by Blackstone Real Estate

Shorenstein Properties, LLC (“Shorenstein”), an owner and operator of high-quality office, residential and mixed-use properties across the U.S., today announced the sale of 2 & 3 MiamiCentral to funds managed by Blackstone Real Estate (“Blackstone”) for approximately $230 million. Located in Downtown Miami, this approximately 330,000 square-foot property…

Related wins approval for another Wynwood mixed-use multifamily project

Nearly 10 months after acquiring a 2.27 acre assemblage in Wynwood’s south end, the Related Group is forging ahead with a new mixed-use project on the site. The Miami Design Review Board on Wednesday approved the developer’s proposal for a pair of 12-story buildings at 2130 North Miami Avenue and 38 Northwest 22nd Street. The project, currently known as…

Galbut development group scores approval for mixed-use North Beach resi project

The developers of one of the first projects planned for the North Beach Town Center district secured approval from the Miami Beach Design Review Board late last week. NoBe Creek LLC, an entity led by Jefferson Brackin, Russell Galbut and his daughter Marisa Galbut, wants to develop a mixed-use multifamily building at 666 71st Street. The board unanimously…

Chetrit scores $15 million for Miami River $1 billion mixed-use project

The Chetrit Group is pushing forward with its long-planned mixed-use Miami River mega-project, as it just scored a $15 million construction loan, bringing its total financing to $70 million. Chetrit Group, through affiliate MC Miami River, secured the loan from MSD PCOF Partners XXXIV, an affiliate of Michael Dell’s MSD Capital private investment firm….

Downtown Miami apartment tower Grand Station — A-Rod an investor — launches leasing

Grand Station Apartments in downtown Miami is launching preleasing of the tower, which counts retired Yankees shortstop Alex Rodriguez as an investor. Rovr Development, led by principals Oscar Rodriguez and Ricardo Vadia, is beginning to lease the 30-story, 300-unit building at 40 Northwest Third Street, near the federal courthouse, according…

Waldorf Astoria Miami, planned as the tallest resi tower south of Manhattan, launches sales

The developers of Waldorf Astoria Residences Miami, planned as the city’s tallest residential tower at 100 stories, are launching sales, The Real Deal has learned. The luxury project, at 300 Biscayne Boulevard, will be the highest skyscraper south of Manhattan at 1,049 feet tall, the developers said. Property Markets Group…

Miami’s upcoming Waldorf Astoria property will soon be the Tallest Residential building south of Manhattan

Step aside, New York; there will soon be a new big building city on the East Coast. Florida isn’t necessarily known for tall, glamorous residential or commercial buildings. As it stands, the tallest building in Florida is the Panorama Tower in the Brickell area of downtown Miami. The 85-story skyscraper is a commercial and residential building that soars 849-feet…

Venezuelan food mogul Mauro Libi nabs Miami warehouse for $8 million

A company tied to Venezuelan Mauro Libi, who owns a food empire, bought a warehouse in Miami International Park for $7.8 million. Records show Eleo Group, managed by Libi, bought a 47,668-square-foot warehouse at 7300 Northwest 35th Terrace from Medley-based window blinds and shades manufacturer Vertilux. Built in 1983, the two-story facility is on 1.8 acres…

Harbor Group International Finances Miami Hotel-to-Multifamily Conversion

Harbor Group International, LLC (“HGI”), a privately-owned international real estate investment and management firm, today announced the $27.5 million financing of a hotel-to-multifamily conversion project in the Coconut Grove neighborhood of Miami. The loan was provided to AB Asset Management (“AB AM”) to acquire and rebrand the property as a Class…

Developers see green in turning golf courses into warehouses

It’s a hole-in-one for warehouse developers. Builders have been turning golf courses into warehouse locations as the industrial space boom continues, according to Bloomberg Businessweek. In May, for example, Onondaga County in New York announced that Amazon would build a $350 million distribution center over 111 acres of land formerly occupied by the…

South Beach Businesses Feel the Pain of Spring Break Chaos and Curfew

Upon entering Miami Beach from the MacArthur Causeway, an electronic sign on Fifth Street warns visitors: “Loud Music Arrestable.” Just a few blocks to the east, vacationers walk along Ocean Drive with stereos and Bluetooth speakers, blaring music and dancing in the street outside the fenced-in dining areas of local bars and restaurants. Miami Beach is…

Spring Break Chaos On Miami Beach: Just A Blip For CRE

After big crowds converged on Miami Beach this weekend, the city imposed an 8 p.m. curfew and shut down bridges connecting the beach and the mainland — giving people just hours’ notice and backing up traffic late into the night. The restrictions are in place Thursdays, Fridays, Saturdays and Sundays through April 11. Officials, residents and business owners have…

Federal bill would give $1.5B to pro-housing localities

To combat the affordable housing crisis, three U.S. senators are set to introduce the Housing Supply and Affordability Act. The bipartisan bill would provide $1.5 billion for federal grants to local governments that commit to increase their supply of local housing, to be distributed over the next five years, according to Bloomberg CityLab. “All Americans deserve…”

Miami Beach developers nab $345M construction loan for 500 Alton

Beach developers Russell Galbut and David Martin scored a $345 construction loan for their planned residential tower at the entrance to South Beach, marking one of the largest loans to close in South Florida during the pandemic, The Real Deal has learned. Galbut’s GFO Investments and Martin’s Terra are partnering on the project at 500 Alton Road…

Miami Beach investor Greg Mirmelli to convert former Banana Republic store into mansion hotel

Miami Beach investor Greg Mirmelli bought the former Banana Republic building at 800 Collins Avenue, with plans to convert the property into a mansion hotel, The Real Deal has learned. Mirmelli paid $4.5 million for the 10,026-square-foot building, he said. Property records show the seller is 800 Collins Ave LLC, led by Sam Herzberg. Herzberg’s entity paid $9.7 million…

 $5.4M Sale Arranged for Former Methodist Church and School in Miami

Gridline Properties has arranged the sale of a former Methodist church and school in Miami for $5.4 million. The 28, 947-square-foot property is located at 205 NE 87th St. in Miami’s Upper East Side and within El Portal Village. Built in 1952, the former Rader Memorial United Methodist Church has been vacant for more than 10 years. Gridline’s Alfredo Riascos…

Rock-bottom prices: 11 malls whose valuations have tanked

The pandemic has wreaked havoc across the retail industry, but few have been hit harder than second-tier malls. And it’s no surprise the largest mall operators have taken the biggest hits. Simon Property Group and Brookfield Property Partners controlled 5 of the 11 malls whose values have fallen the most, according to Trepp, which tracks commercial mortgage-backed…

Limestone Asset Management Closes on Pinecrest Town Center Mixed-Use Retail and Office Property for $32 Million

Miami-based Limestone Asset Management, via a joint venture with Orion Real Estate Group, closed on Pinecrest Town Center, the mixed-use retail and office property located at 12651 South Dixie Highway, Pinecrest, FL 33156, for $32 million. Limestone Asset Management invests in and acquires real estate properties over all asset classes throughout North…

Pop-Up Hotel Concept WhyHotel Launches In Miami

A pop-up hotel concept that originated in Washington, D.C., will launch in Miami on May 1. WhyHotel takes over units in new luxury apartment buildings, bringing in revenue and adding vitality to properties during the lease-up period. In Miami, WhyHotel will operate over 100 units at AMLI Midtown Miami, a 719-unit complex at 3000 NE Second Ave. that…

Sterling Bay Signs Retail Lease with Love Life Café at 545WYN in Miami

Sterling Bay, a Chicago-based real estate development firm, has signed a retail lease with eatery Love Life Café in Miami’s Wynwood district. Love Life Café will take 3,767 square feet of storefront space at 545wyn, Wynwood’s first Class A creative office building. Sterling Bay broke ground on 545wyn in January 2019 and completed the building in late 2020.

Office sector to keep sinking until 2024, Moody’s predicts

The office market is looking at three more years of pain until it turns the corner, according to a new report. Moody’s Analytics and CWCapital note that long-term leases saved landlords from a mass exodus but downsizing will continue to erode their tenant base. As a result, the rise in subleasing and vacancy and the fall in rents will continue before starting to ease…

Sleepy No Longer, Downtown Miami Evolves Into Urban Hub

Once a place that emptied at 5 p.m., Downtown Miami is in the midst of a dramatic transformation. Overlooked no longer, the city’s central business district is getting denser, growing taller and attracting new attention. The area has been poised for a breakout since the Great Recession, and its moment finally seemed to arrive during the pandemic. Out-of-state…

Developers look to seize the moment as Miami condo craze returns

A rendering of Baccarat Miami With half the business elite seemingly moving to Miami, South Florida’s residential developers are betting that migration momentum will overcome even the market’s significant supply glut.    They’re launching major condo towers set to bring thousands of new luxury units to the area, citing the spillover from booming single-family…

Israeli bond market rule changes could hinder U.S. developers

Around 30 U.S. real estate firms have raised over $5.5 billion in the Israeli bond market in the past decade (iStock) Over the past decade, U.S. developers have flocked to the Israeli bond market to obtain cheap financing for real estate projects — but that could change if new rules governing bonds are enacted. The Israel Securities Authority has…

Multifamily complex in Overtown Opportunity Zone hits market for nearly $12M

An apartment complex in an Opportunity Zone in Miami’s Overtown neighborhood hit the market with an asking price of $11.5 million. The owner of Citywalk Apartments, tied to Miami-based Armos Investments, listed the property at 415 Southwest Ninth Street after renovating some of the 92 units. The apartments were built in 1950, records show. Arthur Porosoff, David Cohen and Joseph Phelps of The Porosoff Group,…

WeWork lost $3B in 2020: report

Investors betting on WeWork’s second act just got a wake-up call. The co-working company lost $3.2 billion last year as the Covid-19 health crisis slashed the demand for flexible office spaces, the Financial Times reported, citing documents shown to possible investors. The pandemic caused WeWork’s occupancy rates to fall 47 percent in 2020, down from 72…

What’s Driving Record Industrial Real Estate Demand

The global pandemic accelerated the growth of e-commerce as lockdowns and safety concerns prompted an increasing number of consumers worldwide to shop online. As a result, several years of online sales growth were condensed into 2020 alone, causing industrial leasing to surge globally as logistics became essential for retailers. Changes in population…

Industrial Properties by U.S. Airports Command Premium Rents

According to CBRE, distribution firms want to be close to major air hubs to expedite speedy deliveries, but there is often a price to pay: Industrial rent premiums average 13 percent in the top U.S. airport submarkets and reach as high as 47% in the Chicago O’Hare submarket. In the era of next-day delivery, third-party logistics firms, ecommerce companies and retailers…

Weird flex but OK: How CRE giants hope to cash in on the future of the office

As a vision of the post-vaccine future of the workplace began to emerge late last year, Industrious co-founder Jamie Hodari was nearing a new funding round with a private equity firm in October. Then, CBRE came calling. The entrepreneur sat down for a socially distanced dinner with CEO Bob Sulentic and Andrew Kupiec, head of CBRE’s in-house co-working…

After $345 million buildout, Brightline to run new Miami-to-Aventura intercity rail

As heralded by a 2019 decision by Miami-Dade commissioners to pay $76 million for a Brightline station near Aventura Mall, county transportation decision-makers last week endorsed the for-profit inter-city rail company’s trains as the preferred mode for a Miami-to-Aventura commuter rail corridor. It will cost an estimated $345 million to build the necessary…

Mixed-use Wynwood buildings on Miami Avenue win OK

A sprawling mixed-use project designed to bring apartments, office space and more in two new buildings in Wynwood won a positive review from the city’s Urban Development Review Board. The board unanimously recommended approval of the project, known as PRH N. MIAMI, after the developer made several changes to the plan in response to issues…

Miami Today Editor suggests we need unity to bar casino perils

Whenever our economy slides, would-be casino owners look to Miami for a free lunch. All that keeps them from the lunch table is state law that bans casinos here and the integrity of enough lawmakers to keep the important barrier intact. As post-pandemic business swings back to normal, casino interests have their knives and forks out with hope of swaying Florida…

A downturn in travel of pandemic proportions : The latest data on miles traveled by air, rail, and road

It’s not news to say that people in modern economies travel. For work, school, or pleasure. For a few hours, days, weeks, months, or even longer. Going places has been an integral and obvious part of work and life for most American households and those of any wealthy economy. It’s also not news to say that travel and work commutes came to a halt last year…

One Thousand Museum developers score $90M refi to stave off foreclosure

The developers of the Zaha Hadid-designed One Thousand Museum condo tower in Miami secured a lifeline, The Real Deal has learned. Louis Birdman, Gilberto Bomeny, Kevin Venger and partners Gregg Covin and Todd Glaser, closed on a $90 million condo inventory loan from Cirrus Real Estate Partners, according to the lender. The refinancing comes less…

Knotel to tap former top WeWork exec as CEO

Knotel is bringing on a WeWork veteran to help straighten out the bankrupt flex-operator. Former WeWork vice chairman Michael Gross will join Knotel as its chief executive, the Wall Street Journal reported. Gross’ first order of business will be to reduce Knotel’s significant losses. The company already plans to close a number of its locations as part of its bankruptcy…

Here’s where Trumpworld has put down roots in South Florida

When Donald Trump left the White House on Inauguration Day, skipping his successor’s ceremony, he flew to South Florida, which has become a base of sorts for his inner circle since election results became widely accepted. Facing a hostile reception in the ex-president’s previous home state of New York, the former president and his wife, Melania…

Changing Zoning From Residential to Commercial

Converting commercial property into residential space—like turning a parking garage into condos—has been popular recently. But what about changing zoning from residential to commercial? Commercial real estate is lucrative. Nearly $90 billion is spent building it each year. If you have a residential property, it could be well worth your time to convert it to…

Cerberus Capital, Stonemont Financial form $1 billion domestic industrial property venture

Stonemont Financial Group and an affiliate of Cerberus Capital Management LP have formed a joint venture to invest in the white-hot logistics sector. The partners want to buy as much as $1 billion worth of industrial real estate, according to Commercial Property Executive. So far, the two firms have purchased properties in Illinois, Florida, Mississippi…

Landlords shun federal rent relief over program requirements

The federal government wants to give landlords and tenants $50 billion to help keep renters in their homes — but some of those property owners are turning down the funding that they’re eligible for. Some landlords have taken issue with the requirements to receive federal rent relief, including disclosing financial information, as well as limits on evicting tenants if…

Flamboyant Miami developer Gil Dezer talks branding, car racing, partnering with Trump

Any screenwriter who pitched the character of Gil Dezer to a Hollywood studio would be laughed out of the room. A chain-smoking, gold chain-wearing, foul-mouthed developer who owns the Aston Martin DB5 James Bond drove in “Goldfinger” and was married at Donald Trump’s Mar-a-Lago? The 46-year-old president of the development firm started by his…

Newmark’s acquisition of Knotel is approved

A bankruptcy court has approved the sale of flex-office provider Knotel to brokerage Newmark. Newmark officials said they expected the deal to close quickly, Commercial Observer reported. The brokerage provided $20 million in debtor-in-possession financing after Knotel filed for bankruptcy in January, and its stalking-horse bid of $70 million brought it closer…

Chart: Miami-Dade Commercial Real Estate Sales February 2021

Miami MLS Number of Sales from March 2019 to February 2021 for a) Commercial, Industrial or b) Commercial, Business, Agricultural, or Industrial Vacant Land within Miami-Dade County, Florida. The chart in this post shows the number of closed sales of Miami-Dade commercial properties, including improved commercial property and vacant commercial land, that were recorded in the Miami MLS for the two…

Midtown Miami Triptych dev site owner files for Chapter 11 amid foreclosure

The owner of a development site, planned for the mixed-use project Triptych, near Midtown Miami, filed for Chapter 11 bankruptcy amid foreclosure. The companies that own the property at 3601 North Miami Avenue are controlled by HES Group CEO and managing partner Francisco Arocha, and managing partner Alberto Abilahoud. Those companies filed…

Data center demand — and rent — surge in secondary markets

As new technologies, streaming and remote work drive demand for data centers across the country, smaller markets with relatively limited supply are attracting more attention. Data center space in secondary markets rented at a rate of $134 per kilowatt per month in the second half of 2020, a significant premium from the average primary market rent of $121…

Chart: Miami Commercial Real Estate Sales to List Price Ratio February 2021

January 2011 to February 2021 Sales to List Price Ratio for Commercial/Industrial Property within Miami-Dade County, Florida and Priced from $1 Million to $10 Million as Recorded in Miami MLS The sales to list price ratio as reported by the Miami MLS for improved commercial real estate (MLS classification: commercial/industrial) within…

Woerners buy historic Paramount Theatre in Palm Beach for $14M

The historic Paramount Theatre building in Palm Beach, which opened in 1927 as a silent film cinema and later morphed into a mixed-use retail and office landmark, sold for $14 million. The family investment firm, Woerner Holdings, through its affiliate WEG Paramount, bought the property at 139 North County Road from Paramount Church, a deed shows. Paramount…

JB’s on the Beach site in Deerfield sells at a discount for $11M

JB’s on the Beach oceanfront restaurant site in Deerfield Beach sold for $11 million, more than a year after it hit the market for $18 million. Ark Restaurants, which already owns and runs the restaurant, bought the 1.5-acre property from Boyle Beach House, led by John Boyle, according to a news release. JB’s on the Beach includes a 9,777-square-foot building…

PrivCap sells assisted living facility in Hollywood for $10M

PrivCap Companies sold the Midtown Manor assisted living facility in Hollywood for $9.7 million. Boca Raton-based PrivCap, through affiliate Midtown Manor Holdings, sold the property at 2001 Polk Street to Midtown Al Propco, led by Moshe Soskin and Joseph Hirsch, according to a deed. The buyer took out a $7.5 million loan from Israel Discount Bank of New York.

Related wins approval to develop high-rise condo project in Hollywood

Hollywood commissioners approved the Related Group’s proposal to develop a high-rise condominium and community center on city-owned beachfront land. Miami-based Related would rebuild the outdated Hollywood Beach Culture and Community Center at 1301 South Ocean Drive, and develop a 30-story, 300-unit condo project on adjacent…

Fort Lauderdale shoots down $1B Bahia Mar condo project on public land

Fort Lauderdale shot down developer Jimmy Tate’s $1 billion Bahia Mar condominium project proposal, but left the door open for Tate to renegotiate his lease for the publicly owned waterfront property. Following Tate’s pitch for 651 condo units during a public meeting on Tuesday, it was clear he didn’t have the needed commission support…

Hollywood approves funding for apartment project with workforce units

Affiliated Development won city approval of its subsidized plan to develop The Tropic, an 18-story apartment building with rent-controlled “workforce” units in downtown Hollywood. The 208-unit, mixed-income apartment building at 1744 and 1753 Federal Highway will have 50 percent of its units reserved for such middle-income tenants as police officers…

Triarch buys Dania Beach industrial property for $10M

Triarch Capital Group bought a Dania Beach warehouse distribution property for $10.4 million, in a deal a broker says set a record price per square foot. Aventura-based Triarch Capital bought the two buildings at 950-952 and 940 Eller Drive as well as a next-door half-acre lot in an off-market deal, according to a press release. Records show the buildings…

The post Miami Commercial Real Estate News March 24, 2021: Blackstone Snags MiamiCentral Buildings for $230 Million; Galbut’s NMB MXU Project Scores Approval; More… appeared first on Hawkins Commercial Realty.

EDIT BELOW

The chart in this post shows the number of closed sales of Miami-Dade commercial properties, including improved commercial property and vacant commercial land, that were recorded in the Miami MLS for the two years ending February 2021. One can see that February was a fairly normal sales month for Miami commercial real estate.

This is only for sales booked in the Miami Multiple Listing Service (MLS). This does not record all commercial property sales, but it records many. Given that it doesn’t record all sales it can’t be said to be perfectly representative of the asset class. Nevertheless, given that it is representative of commercial property sales that have also been so recorded in a prior period versus the current one, i.e. apples to apples, it should be fairly reliable for gauging change.

The post Chart: Miami-Dade Commercial Real Estate Sales February 2021 appeared first on Hawkins Commercial Realty.

The sales to list price ratio as reported by the Miami MLS for improved commercial real estate (MLS classification: commercial/industrial) within Miami-Dade county in Florida priced from $1 million to $10 million in January drifted lower to 90.3% from 94.1% the month prior. Though the lowest it has been since September of 2020, this percentage is about the middle of the pack when viewed over recent years.

The post Chart: Miami Commercial Real Estate Sales to List Price Ratio ~ February 2021 Commercial MLS appeared first on Hawkins Commercial Realty.

Kushner starts construction on first South Florida development, scores $80M loan

Laurent Morali and Charles Kushner with a rendering of their Wynwood project Kushner Companies started construction on its first South Florida development with partner Block Capital Group. The developers are financing construction of their Wynwood project with a roughly $80 million loan from Axos Bank and Fortress. New York-based Kushner, founded…

Kushner Breaks Ground On First Florida Project – in Wynwood

Kushner Cos. broke ground Thursday on its first development project in Florida, where the company has been purchasing land over the past few years. Wynd, formerly called Wynwood 27 & 28, will be a mixed-use complex in Miami composed of two buildings at 130 NW 27th St. in the Wynwood arts district. Designed by Arquitectonica and developed…

Interactive Map: Land Sales psf by Miami 21 Zoning Code

To really use this correctly, you’ll need to access this on Google Maps directly. First, read the following. This map was made by using publicly available sales, filtering out sales types that tend to result in errant data. Consequently, though the underlying data was systematically assembled, it is far from complete, and thus is not perfect. Also note that this is intended…

SH Hotels & Resorts to Open 62-Story Treehouse Hotel in Brickell District

SH Hotels & Resorts, an affiliate of global private investment firm Starwood Capital Group led by Barry Sternlicht, will open the Treehouse Hotel in Miami’s Brickell district in 2023. Rockwell Group and SHoP Architects are the designers of the development, which will be the first U.S. Treehouse Hotel. The first Treehouse Hotel debuted in London in 2019. Treehouse…

Yardi Releases Winter 2021 Miami Multifamily Report

As Miami continues to navigate the health crisis and ensuing economic hardship, the metro became an example of resilience in the face of adversity, according to a study by the Atlantic Council’s Adrienne Arsht-Rockefeller Foundation Resilience Center. The report commended Miami’s efforts to repurpose existing strategies—already tested against coastal…

Edgewater Assemblage Site Fronting Biscayne Blvd Lists for $49.5M

A commercial assemblage spanning almost three acres in Miami’s blooming Edgewater neighborhood was recently placed on the market with a price tag nearing $50 million. The site includes a commercial building as well as 54 apartments. According to property records, the assemblage, located at 3333 Biscayne Boulevard, is controlled by Miami Sunrise Properties…

HFZ faces lawsuit, unpaid tax bill for Shore Club South Beach hotel

A partner in HFZ Capital Partners’ Shore Club in South Beach filed a lawsuit against the hotel’s owners, as HFZ’s financial and legal troubles continue to mount. A company tied to The Clark Estates, the family of the late newspaper publisher and businessman Stephen Carlton Clark, is suing the Shore Club’s owners to block the sale of the hotel without the approval…

Hulu unveils trailer for new WeWork documentary

“When you tell a 30-something male he’s Jesus Christ, he’s inclined to believe you.” That’s a line from the trailer for Hulu’s new crime-thrilleresque documentary on WeWork, set to hit the streaming service April 2. The two-and-a-half minute preview for “WeWork: Or The Making And Breaking Of A $47 Billion Unicorn” released Wednesday give…

Retail spending falls in February, but here come stimulus checks

Retail sales in February dropped 3 percent from January, a sharper decline than expected, but reflecting the timing of stimulus payments. Sales in January had surged 7.3 percent after $600 stimulus payments were deposited into consumers’ bank accounts at the end of last year. Spending then fell in February, but was $33 billion higher than in February 2020…

Citizens insurance seeks rate increase after adding 100K policies over last year

Florida’s state-backed insurer, Citizens Property Insurance Corp., is seeking a rate increase as it grapples with more than 100,000 new customers gained over the past year. Barry Gilway, Citizens’ president and CEO, said an increasing number of private insurers are not writing new policies or are restricting the types of properties they will cover, according to the…

Miami Beach Treehouse nightclub for sale — for cash or cryptocurrency

A Miami Beach nightclub is for sale, and open to Bitcoin buyers, which could make it the first known commercial real estate deal to close with cryptocurrency. Treehouse nightclub owner and operator Michael Freundlich put the single-story, 4,322-square-foot property at 323 23rd Street on the market. The nightclub, known for its techno and EDM…

Will This Miami Nightclub Be First U.S. CRE Sale In Bitcoin?

A Miami Beach nightclub called Treehouse at 323 23rd Street in South Beach is for sale, and the seller will accept Bitcoin as payment. If a Bitcoin buyer emerges, it could be the first U.S. commercial real estate transaction using cryptocurrency, according to.. “He’ll do part Bitcoin, full Bitcoin. He’ll hold paper. He’ll do a lease with an option. He would probably entertain…”

Bitcoin price – Miami Beach Nightclub for Sale, Open to Bitcoin Buyers

A Miami Beach nightclub is for sale, and open to Bitcoin buyers, which could make it the first known commercial real estate deal to close with cryptocurrency. Treehouse nightclub owner and operator Michael Freundlich put the single-story, 4,322-square-foot property at 323 23rd Street on the market. The nightclub, known for its techno and EDM…

Eric Trump is pushing for the family’s Doral golf resort in Florida to be turned into a casino

Eric Trump is pushing for the Trump Organization’s financially struggling Miami Doral Resort in South Florida to be turned into a casino to help boost revenues, the Washington Post reported Wednesday. The Florida state legislature is considering pursuing legislation that would allow real estate developers to grant gambling permits to properties without needing…

Much Of NYC’s CRE Business Has Moved To Florida. Will It Stay?

Miami has come to be known as the sixth borough of New York City, flourishing through the pandemic as moneyed Northeasterners have made a well-publicized move south. High earners, who in any other year would be packed into subways on their way to Midtown skyscrapers, are instead filling the Miami restaurants and buying pricey Florida houses and…

Oasis Wynwood unveils restaurant lineup, Pura Vida opens Abba Telavivian Kitchen on Miami Beach, other restaurant news

The Oasis, a mixed-use development in Wynwood, unveiled its food and beverage lineup. Coyo Taco co-founders Sven Vogtland and Alan Drummond are managing the 35,000-square-foot outdoor space. The Oasis is set to open next month and it will include six dining concepts, a tower bar, and a stage for live performances. Sandwich shop Alidoro, Buya…

Sluggish hotel market showing signs of life

Hotels are receiving an injection of new guests as more Americans receive the Covid-19 vaccine and consider traveling again. U.S. hotel occupancy hit 49 percent in the week ending March 6, its highest level since last August, the Wall Street Journal reported, citing data from STR. That’s down from 65 percent in March 2020 before the effects of the pandemic were fully felt.

Four national, global firms sign Downtown Doral office leases

The Offices at Downtown Doral, a mixed-use office campus within the suburban town center of Doral, has announced leases for four new tenants at 8333, the campus’s class “A” office building. A spokesperson for Codina Partners said the four new tenants are Paramount Residential Mortgage Group Inc. (PRMG), HDR Engineering Inc., Ekman Group and Kia Motors…

Coral Gables sounds out merchants on adding street music

Coral Gables city commissioners favor possibly easing noise prohibitions near and around the Central Business District. During their March 9 commission meeting, Commissioner Michael Mena brought up a discussion on whether restaurants or venues residing at the Central Business District should have lighter restrictions to play live music. Mr. Mena said he has…

Melreese soccer development seen as airport safety threat

Several county departments have joined the agency that runs Miami International Airport (MIA) in citing safety, traffic and commercial concerns with a soccer stadium complex proposed on nearby City of Miami-owned Melreese golf course. While there is reason for concern, said Lester Sola, Miami-Dade Aviation director, county staff still needs more information.

Wells Fargo moving Coconut Grove office into city-owned Regatta Harbour garage

Regatta Harbour, the mixed-use development at the helm of Coconut Grove’s waterfront revitalization, has attracted a notable tenant. Project developer The TREO Group– a Miami-based, privately-held real estate investment firm – announced Tuesday a signed lease agreement with Wells Fargo, the diversified, community-based financial services company…

Requiring 68% more costly steel is waste, not patriotism

With the aim of patriotism, Miami-Dade commissioners just signed a blank check to raise costs to taxpayers on an unknown number of infrastructure projects by an unknown percentage with an unknown total price. They missed their target. Their unanimous vote requires that the county use iron and steel products that are made in the USA. Only if suppliers couldn’t…

Blackstone, Starwood strike $6B deal for Extended Stay America

A long-in-the-works deal for an extended-stay hotel chain is finally coming to fruition. Blackstone Group and Starwood Capital Group have acquired Extended Stay America for about $6 billion, Bloomberg News reported. The two private-equity firms are paying $19.50 per share for the hotel operator, according to the report. Both companies have previously invested in the…

AEW sells Miami apartment complex to Grand Peaks for $63M

Cascades at the Hammocks with Grand Peaks CEO Luke Simpson and AEW CEO Jeff Furber (Google Maps) AEW Capital Management sold the Cascades at the Hammocks multifamily complex in southwest Miami-Dade County for $63 million. Records show AEW’s affiliate, Cascades at Hammocks LLC, sold the apartments at 10605 Hammocks Boulevard, to Grand Peaks Properties’ affiliate Cascades Hammocks Apartments LLC. Denver-based…

Newmark’s bid to acquire Knotel is nearly complete

Newmark’s bid to acquire Knotel is nearly complete. The bankrupt flex-office provider was scheduled to be sold on Friday afternoon in an auction, but no other qualified bidders submitted an offer, the Commercial Observer reported. A subsidiary of Newmark, which established a stalking-horse bid in advance of the auction, became the winner, according to the report.

Landlords, condo associations sue to end ban on eviction writs in Miami-Dade

A group of Miami-Dade County landlords, condo associations and others are pushing to end the moratorium on executing residential writs of possession filed during the pandemic. The county has suspended police enforcement of such writs for evictions filed since March 2020. The Miami-Dade Police Department executes writs of possession. Six landlords, three condo…

Data centers poised for record year of leasing

Data centers appear poised for record growth this year. A recent CBRE report found that demand is strong, and preleasing suggests 2021 a sustained surge, CNBC reported. Data centers https://therealdeal.com/chicago/tag/data-centers/ — essentially large warehouses filled with computing and data storage systems — are…

Spider nixes plans for Edgewater condo project, disposes of dev site for $7M

Spider sold an assemblage in Miami’s Edgewater neighborhood for $7.25 million, after scrapping plans to build a 12-story condominium. Spider, led by Andres Goldenberg and Alejandro Eskenazi, sold the 28,000-square-foot site to Edgewater investor Jehad Audy, according to a press release. The two lots are at 113 and 123 Northeast 25th Street, and include a 1926-built…

Target moves to hybrid work-from-home model for corporate office

Target is making moves to take its corporate workforce remote after a banner year in sales. The company will cease operations at the City Center building in downtown Minneapolis and will find alternative office accommodations for its 3,500 workers, the New York Times reported. More than 25 percent of the big-box retailer’s Minneapolis-area corporate…

Residence Inn Coconut Grove sells for $31M, to be converted to apartments

Hersha Hospitality Trust sold a Marriott-branded hotel in Coconut Grove for $31 million…. The Philadelphia-based hotel real estate investment trust sold the three-building, 140-unit Residence Inn by Marriott to AB Asset Management, led by Getzy Fellig and Sam Zalmanov. The Miami Beach-based buyer plans to upgrade the property at 2835 Tigertail Avenue in…

Hersha Hospitality Trust Sells 140-Room Hotel in Miami’s Coconut Grove Neighborhood

Hersha Hospitality Trust has sold the Residence Inn by Marriott, a three-building, 140-room hotel at 2835 Tigertail Avenue in Miami’s Coconut Grove neighborhood. John Crotty, Michael Fay, David Duckworth, Brian de la Fé, Emily Brais and Berkley Bloodworth of Avison Young represented the seller in the transaction. AB Asset Management purchased the hotel for an…

Record cargo activity at PortMiami; January busiest month in history

PortMiami, one of the top ports in the U.S., processed 113,835 Twenty-Foot Equivalent Units (TEUs) in January 2021, an increase of 21.02 percent from the 94,064 TEUs processed in January 2020, the most active month ever recorded. Between fiscal year to date, Oct. 1, 2020, through Jan. 31, 2021, PortMiami processed a total of 420,838 TEUs representing the busiest…

The future of commercial real estate in Miami Beach

One year after the pandemic shut everything down the region is seeing a pop of activity in residential sales and interest from companies in having some kind of a presence in South Florida. If and how long that lasts is unpredictable, but four local industry leaders shared their thoughts on what’s ahead for commercial real estate in Miami Beach.

Rotem Rosen wins round in fight with Alex Sapir over Tamir Sapir’s estate

Rotem Rosen has won the most recent courtroom skirmish in the protracted war for more than $100 million of the estate of his former father-in-law, the late Tamir Sapir. The dispute, now in its second year in New York Surrogate’s Court, was nearly settled last year. But then the late real estate titan’s son and executor of his will, Alex Sapir, reversed course at the…

Biscayne Boulevard dev site hits market for $11M

A multifamily and commercial development site at 11240 Biscayne Boulevard near North Miami hit the market for $10.5 million. Owner Alex Silberman purchased the 3.2 acres of land at 11240 Biscayne Boulevard in August 2012 for $2.9 million from Biscayne 114 Center of New York, property records show. The asking price shows a significant uptick in valuations since then.

The 369-unit multifamily Vesada in Doral begins lease-up phase

LMC has kicked off leasing at its second community in Doral, Fla. Leasing opportunities for Vesada will be available through the leasing office that opened earlier this month alongside virtual and online alternatives. Scheduled to see its first move-ins in March, the 369-unit Vesada will offer one-, two- and three-bedroom floorplans. The units…

Done deal: Biden signs $1.9T stimulus with billions for real estate

President Joe Biden signed the $1.9 trillion stimulus package on Thursday, aggressively expanding federal aid to renters, homeowners, small businesses and more. “This historic legislation is about rebuilding the backbone of this country,” Biden said before signing the bill, “and giving the people of this nation, working people, the middle-class folks, people…

Bruce and Shawn Chait arrested on charges of extorting Miami based 13th Floor Investments

Father and son real estate duo Bruce and Shawn Chait were arrested on charges they tried to extort millions of dollars from Arnaud Karsenti of 13th Floor Investments, in connection to Tamarac housing communities the firm developed on golf courses once owned by the Chaits. The Florida Department of Law Enforcement arrested…

AMC reopens 90% of U.S. theaters

The show is going on for AMC. The international movie theater chain has reopened nearly 90 percent of its U.S. cinemas. AMC Entertainment Holdings said Wednesday that 527 out of 589 domestic theaters have reopened since last year’s shutdown. They include theaters in New York City, and theaters in Los Angeles are set to reopen soon. Internationally…

Sunbeam Television buys North Bay Village site next to Channel 7 for $29M

Sunbeam Television Corp., owner of WSVN-Channel 7, bought property next to the TV station in North Bay Village for $29 million. Records show Sunbeam Television, led by Andrew Ansin, bought two lots next to Channel 7 from Isle of Dreams, led by Andre Radandt. The property at 1415 Northeast 79th Street now has a two-story, 17,426-square-foot utility…

Lynd buys Margate apartments from Grand Peaks for $51M

San Antonio-based multifamily investor Lynd bought a Margate apartment complex for $50.75 million. Lynd bought the 280-unit Lakes of Margate at 5750 Lakeside Drive from Denver-based Grand Peaks, according to a press release. The sale price equates to $181,250 per unit. Built in 1987, the garden-style community spans nearly 14 acres, according to property…

Raanan Katz buys Publix-anchored Plantation shopping center for $17M

Raanan Katz’s RK Centers picked up a Publix-anchored Plantation shopping center for $17 million, its third South Florida acquisition since September. RK Centers, through affiliate RK Veranda, bought Veranda Shoppes from Regency Centers Corp. affiliate Equity One JV Sub Veranda, according to a deed. Property records show the 47,678-square-foot shopping…

The post Miami Commercial Real Estate News March 17, 2021: Coconut Grove Residence Inn Sells; Kushner Breaks Ground on Wynwood Project; More… appeared first on Hawkins Commercial Realty.