HomeShare CEO Jeff Pang and a converted bedroom in Downtown Los Angeles

To save money in expensive cities like Los Angeles, renters have long subdivided apartments, willing to sacrifice comfort in order to find a decent place to live. Now, a cottage industry has taken that necessity to an extreme.

Bunk beds, “sleeping pods,” and temporary room partitions are becoming popular with landlords and renters amid California’s tight and pricey housing market, according to the Los Angeles Times. Some renters will even squeeze into a space if the building comes with attractive amenities.

The number of people per housing unit has been on the decline nationally, but in California the rate has increased from 2.79 per unit in 1990 to 2.97 this year. Median rents in L.A. County are around $2,442 per month, compared to the national median of $1,553 per month.

San Francisco-based company HomeShare contracts with landlords to match residents with people looking for partitioned rooms, and rents out partitions. The company will also transfer residents to other units if things don’t go well with roommates. Customers pay a monthly fee for the service.

Christopher Cacho, a recent graduate who recently moved to L.A., went through HomeShare and now pays $950 a month for a an 11-foot by 8-foot space in a Glendale apartment building, according to the Times. In his case, he opted for the smaller space in exchange for the building’s amenities.

The firm Up(st)art, signs multiyear leases for houses, then outfits them with amenities for artists, and adds bunk beds or sleeping pods, starting at $700 a month. That includes acting and dancing classes, as well as use of in-home music recording and photo studios. [LAT] — Dennis Lynch 

(Credit: iStock)

As interest rates climb and salary growth stalls, borrowers are taking cash out against their homes in volumes not seen in over a decade.

Close to $14.6 billion was withdrawn from home equity across the country during the third quarter, as more than 80 percent of borrowers chose to take out cash against their homes, according to The Wall Street Journal. However, these figures are still well below rates seen before the financial crisis, when borrowers cashed out over $80 billion for three consecutive quarters in 2006.

Homeowners often seek to refinance their homes to retire their previous loans, and cashing out can be used to fund renovations or retire a college debt. The economy’s growth is driving up housing prices, but leaving worker salaries growing at a slower rate, so many borrowers are turning to the cash stored within their homes.

“I don’t have that much cash on hand,” Mandy Whitworth, a resident of Dallas, told the Journal. “It allowed me to pull out equity from the home to reinvest in the repairs and addition.”

It follows a report this month that found home loan application volume fell to its lowest point since December 2014. [WSJ] — David Jeans  

Miami-Dade condo sales dropped last week thanks in part to the Thanksgiving holiday.

The county recorded 80 closings for a total of $24.2 million, nearly half of the $42 million sales volume recorded the previous week. Condos sold for an average price of about $302,000 or $265 per square foot.

The priciest deal was at the Trump Palace in Sunny Isles Beach. Unit 1501 sold for $1.29 million, or $605 per foot, after a little more than four months on the market. David Lee had the listing, and Lea Rubin represented the buyer of the three-bedroom, 2,143-square-foot unit. The condo development was completed in 2006 by a partnership between the Trump Organization and Dezer Development.

The second most expensive deal was at the Reserve at Marina Palms in Aventura. Unit 1911 sold for $1.1 million, or $529 per square foot. Elena Chacon represented the seller and Melanie Tenenbaum brought the buyer.

Here’s a breakdown of the top 10 sales from Nov. 18 to Nov. 24. Click on the map for more information:

Most expensive

Trump Palace, Sunny Isles Beach | #1501 | 139 days on market | $1.29M | $605 psf | Listing agent: David Lee | Buyer’s agent: Lea Rubin

Least expensive

St Tropez, Sunny Isles Beach | #1-TH403 | 65 days on market | $600k | $289.5 psf | Listing and buyer’s agent: Renato de Azeredo Mendonca

Most days on market

Towers of Key Biscayne, Key Biscayne | #F1007 | 621 days on market | $875k | $491 psf | Listing agent and buyer’s agent: Ileana Puig

Fewest days on market

One Paraiso, Miami | #1001 | 59 days on market | $1.08M | $464 psf | Listing agent: Gustavo Cabrera | Buyer’s agent: Ana Anauate Hirschbruch

Aston Martin Residences

UPDATED, Nov. 27, 3:20 p.m.: The Coto family of Argentina closed on a $200 million construction loan to build Aston Martin Residences, a luxury waterfront condo tower in downtown Miami.

Riverwalk East Developments LLC, an affiliate of the Coto’s G&G Business Developments, secured the financing from Brazilian lender Itaú BBA International, property records show.

G&G broke ground on the 66-story, 391-unit tower at 300 Biscayne Boulevard Way about a year ago.  It’s expected to be delivered in 2022, which could be the start of the next cycle.

Prices range from about $800,000 to more than $50 million, and Cervera Real Estate is handling sales and marketing. The project is just over 40 percent presold, according to a spokesperson.

The Coto family runs the large Coto Supermarkets chain in Argentina, and has development projects in Latin America and Europe.

The downtown Miami building is being built on the former Epic East site at the mouth of the Miami River. The developer bought the 1.25-acre property for $125 million in 2014.

A spokesperson for G&G could not immediately be reached for comment.

The sail-shaped building, designed by Revuelta Architecture and Bodas Miani Anger, is the first residential tower for Aston Martin. Amenities will include butler yacht service that delivers residents to the beach.

Banks have generally pulled back on condo construction lending in South Florida over the past year, with a few large projects as the exceptions. Despite a marketwide slowdown in luxury condo sales, the Trump Group (of no relation to the president), closed on a $558 million loan from Bank OZK in October, marking the largest condo construction loan in Miami-Dade County this cycle. The second largest construction mortgage of the cycle was the $315 million loan by Wells Fargo and Blackstone to Dezer Development and Related Group’s Residences by Armani/Casa.

The South Florida Business Journal first reported the Aston Martin loan.

TRD South Florida’s Winter issue drops in December.

The Real Deal South Florida’s winter 2018 issue is almost here, and it’s jam-packed with juicy stories and rankings.

On December 14th, digital subscribers will get first dibs on reading the magazine, including our examination of the future of the white-hot multifamily market and an in-depth look at the struggle to stay independent in a residential brokerage scene dominated by ever-growing local and national heavyweights.

The issue also features a ranking of the top coworking firms in Miami-Dade, an architectural and design survey of some of the most prominent projects of the cycle, an analysis of the residential brokerages that have seen the most turnover and plenty more.

Check out our fall issue online.

The deadline for advertising is Dec. 10. Contact us at Advertising@TheRealDeal.com or call 786-334-5052. 

Renderings of Time Out Miami

Time Out Market Miami | Miami Beach

Time Out Market Miami unveiled new chefs opening at its Miami Beach food hall in February.

Chefs Norman Van Aken, Antonio Bachour and Giorgio Rapicavoli are each taking space at the food hall, at 1601 Drexel Avenue. Veronica Menin and Diego Tosoni will open Love Life Cafe; Suzy Batlle is bringing Azucar Ice Cream; Christian and Dominica Plotczyk, the owners of Ella’s Oyster Bar, will open Salt & Brine. Other openings will include chef Shuji Hiyakawa’s Wabi Sabi; and Phuc Yea from chef Cesar Zapata and Aniece Meinhold.

The market will have 17 food and beverage concepts and seat up to 400. Previously announced chefs are Jeremy Ford, Michael Beltran and Alberto Cabrera. Instead of charging rent, Time Out takes a percentage of the chefs’ sales revenues.

Punch Bowl Social | Wynwood

Punch Bowl Social, a Denver-based chain of arcade, karaoke bar and restaurant wrapped into one, filed plans with the city of Miami’s building department to build out a 21,000 square-foot space at 2660 Northwest Third Avenue in Wynwood.

Goldman Properties paid $1.1 million for the property in 2012. The location will mark the first for Punch Bowl Social in Florida, according to its website.

Historic Walgreens property | downtown Miami

Stambul filed plans for a 48,000 square-foot restaurant inside the historic Walgreens at 200 East Flagler Street in downtown Miami.

In July, Stambul paid nearly $20 million for the building and said it planned to build out a “multi-level entertainment complex” with retail and dining in the space, which was most recently home to La Epoca department store.

The permit, filed with the city’s building department, calls for other structural repairs to the building, including 20,000 square feet of repairs and a 4,000-square-foot kitchen.

Stambul’s Daniel Peña could not immediately be reached for comment.

India Kitchen and Bar | Midtown Miami

India Kitchen and Bar is opening in the former Brasserie Azur space at the Shops at Midtown Miami, according to new signage.

Brasserie Azur, which opened in 2015 and closed earlier this year, was leasing about 5,000 square feet at 3252 Northeast First Avenue, unit 109.

Lime Fresh Mexican Grill | Midtown Miami

Lime Fresh Mexican Grill just opened in a 2,616-square-foot space at Midtown Five at 125 Northeast 32nd Street. Other tenants that have recently opened at the 26-story apartment tower include MidiCi Neapolitan Pizza; Biostation, a medical wellness center; Solidcore Pilates and Omni Nail Salon.

Tacocraft Taqueria and Tequila Bar | Lauderdale-by-the-Sea

Tacocraft Taqueria and Tequila Bar signed a 10-year lease with two five-year extensions for a space in Lauderdale-By-The-Sea, at 4400 North Ocean Drive.

Marc Falsetto of JEY Hospitality Group brokered the deal for the 4,000-square-foot restaurant. It’s expected to open early next year.

Dr. Smood | Coral Gables

Dr. Smood leased 1,250 square feet at Giralda Place in Coral Gables.

The healthy cafe chain is set to open in the first quarter of next year at the downtown Coral Gables development, at 271 Giralda Avenue. No brokers were involved and a spokesperson for the project declined to provide the asking rent. The mixed-use project includes office space and 33 condos, which are being marketed by EWM Realty International. John Ellis with RKF is handling commercial leasing.

Del Frisco’s Grille | Fort Lauderdale

Del Frisco’s Grille recently opened at 501 Las Olas Boulevard in Fort Lauderdale.

The restaurant group is leasing about 8,000 square feet in downtown Fort Lauderdale. The Comras Company represented the landlord in the 10-year deal, and Koniver Stern Group and Newmark Commercial represented Del Frisco’s.

Shoreline Technology Park (Credit: Wikipedia)

Alphabet Inc., Google’s parent company, has just scooped up a $1 billion business park near its Mountain View headquarters.

The tech behemoth purchased Shoreline Technology Park, a 51.8-acre property a few blocks away from its Googleplex, Bloomberg reported. Google is already the main tenant of Shoreline’s 12 buildings.

Google’s been on something of a real estate tear.

The company recently bought up property in nearby Sunnyvale for $160.3 million, according to the Mercury News in San Jose. Earlier this year, Google closed on its $2.4 billion purchase of the Chelsea Market building in New York City. The company is also trying to buy property in San Jose for a new campus, but the deal is being challenged by two nonprofits that filed a lawsuit to block the $67 million deal.

Google’s latest massive real estate purchase comes on the heels of another tech giant announcing the location of its new headquarters. Amazon will be splitting its new HQ2 between Long Island City in Queens and Crystal City in Arlington, Virginia. The company is also opening a regional hub in Nashville, Tennessee. [Bloomberg] — Kathryn Brenzel

David Blitzer, Managing Director and Chairman of the Index Committee at S&P Dow Jones Indices (Credit: S&P Dow Jones via YouTube and iStock)

Want more evidence the U.S. housing market is losing ground? Home price gains continue to slow in many of the largest metro areas, according to a new S&P CoreLogic Case-Shiller nationwide survey.

The 5.5 percent home price increase in September was down slightly from the 5.7 percent gain the previous month, according to the report. The 5.5 percent gain was the smallest since January 2017.

Both the survey’s 10-city and 20-city composites performed worse than the national average, meaning price gains were strongest outside major markets.

Los Angeles saw a 5.5 percent home price increase, while Miami had a 4.6 percent bump and Chicago had a 3 percent rise.

New York’s 2.6 percent year-over-year increase was the weakest of all major cities.

Some of the markets that are now seeing some of the strongest gains, like Las Vegas, Phoenix and Tampa, Florida; saw the most significant drops in home prices during the financial crisis.

Other recent figures point to a slowdown across the board. Sales of existing and new single-family homes were down 9.3 percent compared their peak value in November 2017. Existing home sales have declined on an annual basis for eight straight months.

Housing starts are also down and homebuilder confidence in the market dropped to its lowest point in two years earlier this month.

David Blitzer of S&P Dow Jones Indices attributed the slowdown in part to a recent increase in mortgage rates. The national average for a 30-year fixed-rate loan is 4.9 percent, a full percentage point higher than it was a year ago. That could be cause for potential buyers to pull back.

The higher rates also helped push mortgage applications to a four-year low. As those applications slow, more Americans are tapping their home equity. Homeowners took out $14.6 billion against their homes in the third quarter.

(Credit: iStock)

Miami-Dade County is knocking hard on the doors of FlipKey and HomeAway in an attempt to collect untold millions of dollars in unpaid resort taxes.

In two separate lawsuits filed in Miami-Dade Circuit Court at the end of October, Miami-Dade accuses FlipKey and HomeAway of not forcing property owners who list on the short-term rental platforms to pay their share of bed taxes. The complaints also name FlipKey’s parent company TripAdvisor and HomeAway’s parent company Expedia as defendants.

A Miami-Dade spokesman said the county does not comment on pending lawsuits. Representatives for TripAdvisor and Expedia did not respond to emails requesting comment.

According to the complaints, FlipKey and HomeAway are in violation of a county ordinance that requires third-party providers to collect three separate bed taxes totaling 6 percent from individuals and companies that rent properties on a short-term basis. As a result, Miami-Dade has lost millions of dollars in tax revenue, the complaints allege, though the county does not state a specific dollar amount.

Miami-Dade alleges both companies refused to reveal the identities of property owners who use the platform, and have rejected an offer to enter into a collection agreement with the county. Meanwhile, TripAdvisor and Expedia recently entered into collection agreements with Broward County, the lawsuits state.

Miami-Dade enacted its bed tax collection for short-term rental platforms in April 2017  as part of several measures to reign in the short-term rental industry. The same year, Miami-Dade passed an ordinance capping occupancy limits for vacation and short-term rentals in unincorporated Miami-Dade to 180 days per year. Under the new law, hosts are also required to sign up for a certificate of use, register for a business tax receipt, screen for sexual offenders and enforce some rental standards on guests, such as following standard garbage procedures and noise restrictions.

Airbnb, the nation’s largest short-term rental provider, has collection agreements with Miami-Dade and Broward that remitted more than $12 million to both counties through June 2018.

Alejandro Andrade, and 15231 Sunnyland Lane, Wellington

A former national treasurer of Venezuela was sentenced to 10 years in prison on Tuesday for his role in a $1 billion dollar money laundering scheme in which much of the money went into South Florida real estate.

Alejandro Andrade was sentenced by U.S. District Judge Robin L. Rosenberg of the Southern District of Florida. He admitted in a guilty plea that he received over $1 billion worth of bribes from his co-conspirator, Venezuelan TV mogul Raul Gorrín, and other co-conspirators in exchange for allowing them to tap into Venezuela’s special fixed currency exchange rate, according to the U.S. Department of Justice. The fixed rate is much more favorable than the market rate.

Federal prosecutors said Andrade received cash as well as private jets, yachts, cars, homes, champion horses, and high-end watches from his co-conspirators. As part of his guilty plea, he agreed to forfeit his assets, which included 17 champion show horses and five real estate properties in Palm Beach County.

Andrade pleaded guilty in December 2017 to one count of conspiracy to commit money laundering. The indictment was not unsealed until this month.

The properties include:

• 15231 Sunnyland Lane, Wellington, a five-bedroom, six-bathroom estate that was last sold for $4.75 million in 2012.
• 15680 46th Lane South, Wellington, a three-bedroom, two-and-half bathroom home that last sold for $1.35 million in 2013.
• 15740 46th Lane South Wellington, a 4.2-acre parcel of land.
• 1290 North Ocean Boulevard, Palm Beach, a six-bedroom, five-and-half bathroom home that last sold for $8 million.
• 16912 Crown Bridge Drive, Delray Beach, a four-bedroom, five-bathroom home that last sold for $1.7 million in 2016.
• 15159 Sunnyland Lane, Wellington, a seven-bedroom, five-and-half bathroom, 10-acre estate that last sold for $3.5 million.

Gorrín, a billionaire who is president of the news channel Globovisión, is now a fugitive, according to the Department of Justice.

Authorities are now seeking to seize about two dozen properties allegedly tied to Gorrín. Those residences include luxury homes in Miami’s Cocoplum neighborhood and six in Manhattan.

The indictment follows a separate billion-dollar money laundering scheme in July that also included real estate in South Florida. In that case, federal prosecutors say top Venezuelan officials siphoned funds out of the state oil company, and into assets throughout the world.

In both cases, some of the money is alleged to have been poured into two units at Dezer Development’s luxury Porsche Design Tower in Sunny Isles Beach.

In November, Matthias Krull, a wealth manager with the Swiss bank Julius Baer Group, was sentenced to 10 years in prison for his role in that scheme, after pleading guilty in August.

Gorrín was not a defendant in that case, but the Miami Herald — which first reported on the most recent indictment — reported that he is suspected of moving $600 million from PDVSA to a European bank for his own benefit as well for other members of Venezuela’s elite class.

5951 Alton Road (Credit: One Sotheby’s International Realty and iStock)

A few months after announcing it was moving Popeyes Louisiana Kitchen’s headquarters to Miami from Atlanta, the president of the company is also putting down roots.

Popeyes’ President Alex Santoro paid $2.75 million for the five-bedroom, 4,193-square-foot house at 5951 Alton Road in Miami Beach, sources said. The seller is 5951 Alton Road LLC, led by Carol Lavigne of Maine.

The deal marks the highest sale on Alton Road, according to a spokesperson for One Sotheby’s International Realty. Ida Schwartz and Stephanie Doppelt with The Schwartz Team at One Sotheby’s represented the seller. They declined to comment on the buyer’s identity.

The two-story home backs up to the La Gorce Country Club and includes a master suite, media room, and a pool with a waterfall. It was built in 1947 on a 9,635-square-foot lot and last sold in 2016 for $1.3 million. The house was listed for sale for $2.95 million.

Santoro has worked for Restaurant Brands International since 2015. The company acquired Popeyes last year, and is combining the U.S. operations of Popeyes and Tim Hortons with Burger King at the Blue Lagoon office park.

From left: Via Mizner, Miami Worldcenter, and Metropica

UPDATED Nov. 28, 12:35 p.m.: When Triple Five Group gained approval from Miami-Dade County commissioners earlier this year to build the largest mall in America, the news brought national interest to South Florida’s real estate market.

The project will bring an indoor ski-slope to Miami as well as other entertainment, and is betting big on retail at a time when the industry is seeing a surge in vacancies. Yet, American Dream Miami is only one of several megaprojects planned in South Florida. Among them, Turnberry Associates and LeFrak are proposing to build a $4 billion project on a former toxic landfill in North Miami; and Art Falcone, Nitin Motwani and Dan Kodsi are developing a 27-acre, mixed-use project that could transform downtown Miami.

Other developers such as Moishe Mana and Jeff Berkowitz have proposed their own ambitious developments in Wynwood and downtown Miami. Time will tell if their preliminary plans become a reality.

SoLe Mia

Turnberry Associates and LeFrak are seeking to turn the former site of a toxic waste dump into a $4 billion megaproject, SoLe Mia.

The development group’s plans include 12 residential buildings totaling 4,390 units and more than 1 million square feet of commercial space.

For nearly two decades, developers have proposed grandiose plans for the 184-acre site at 15045 Biscayne Boulevard in North Miami, only to end up with losses, lawsuits and disappointment. The site was formerly home to a Super Fund site, but the site has been remediated and is now safe, according to the development group.

In July 2017, the developers broke ground on two 17-story, luxury rental towers totaling 400 units that are part of the first phase of SoLe Mia. And in May 2017, the development group announced Costco would locate a nearly 166,000-square-foot store inside the mixed-use project.

Miami Worldcenter

The $4 billion Miami Worldcenter is spearheaded by Falcone, Motwani and Kodsi. The 27-acre project will include 300,000 square feet of high-street retail, an office tower, two apartment buildings and a convention hotel with 1,700 rooms and 500,000 square feet of meeting, exhibition, and convention space. It will also Paramount Miami Worldcenter, a 60-story, 500-plus unit luxury condo tower that recently topped off.

In October 2017, the developers secured nearly $33 million in financing from Bank OZK, formerly known as Bank of the Ozarks. And Paramount Ventures, which includes Kodsi, Falcone and Motwani, closed on $285 million in construction financing for Paramount Miami Worldcenter in March 2017.

American Dream Miami

Edmonton, Canada-based Triple Five Group’s $4 billion American Dream Miami gained approval from Miami-Dade County commissioners in May to begin construction on what is set to become the largest mall in the country.

County commissioners voted to re-designate nearly 174 acres in unincorporated northwest Miami-Dade that will allow Triple Five to build 3.5 million square feet of retail space, a massive theme park and 2,000 hotel rooms on a vacant triangle between I-75 and the Florida Turnpike’s Homestead Extension. Its plans also include a 16-story ski slope, a 20-slide waterpark, and a 14-screen 3D movie theater, among other entertainment facilities.

Triple Five Group is an umbrella company for the Ghermezian family’s business interests. The group is also behind the West Edmonton Mall and the American Dream Meadowlands in New Jersey. The American Dream Meadowlands has started and stalled over the last 16 years, and when complete will cost about $5 billion, according to published reports.

Via Mizner

Miami isn’t the only South Florida city with massive mixed-use projects planned.

Penn-Florida Companies’ Via Mizner in downtown Boca Raton will span 2 million square feet with a 366-unit luxury apartment building, an 92-unit condo, a 164-key Mandarin Oriental Hotel & Resort and 60,000 square feet of retail. The project will also include a Jack Nicklaus Signature Championship golf course.

In October 2017, Penn-Florida Companies closed on nearly $400 million in financing from New York-based Mack Real Estate Credit Strategies. The remaining $80 million was provided by the U.S. Immigration Fund, an EB-5 lender.

Metropica

In western Broward County, Joseph Kavana’s Metropica Development LLC is developing one of the largest projects in South Florida.

The $1.5 billion Metropica project in Sunrise will include a hotel, 2,250 residences, 485,000 square feet of retail space and 650,000 square feet of office space.

The first phase of office development will be a 170,000-square-foot Class A office building at 1700 Metropica Way that is expected to be completed by 2020.

Metropica will also include a second phase of office development totaling 500,000 square feet, as well as more than 2,250 residential units, retail, shopping and entertainment, green spaces, public spaces, and a luxury hotel. Its located at 1800 Northwest 136th Avenue, on the northeast corner of Sunrise Boulevard and 136th Avenue, west of outlet mall Sawgrass Mills.

The project’s first of residential tower is expected to be completed this year.

Beckham group’s MLS stadium

David Beckham got his wish to move forward with an MLS soccer stadium at Melreese Country Club. He also could get more than just a stadium.

Beckham and the Mas brothers are planning to bring a $1 billion mixed-use development to what is now a public golf course.

The project, known as Freedom Park, could include a 25,000-square-foot soccer stadium as well as more than 1 million square feet of retail and office space and about 750 hotel rooms on the site near Miami International Airport. In total, the development is valued at $1 billion and will be built on 73 acres of the 131-acre Melreese Country Club.

The next step is negotiations on a 99-year lease. Once negotiations are complete, four out of five Miami commissioners will have to give final approval to the lease. Currently, the specific terms have not been decided, including exactly what the owners will pay for the development site.

The Mas and Beckham group previously said it would pay an annual rent of at least $3.6 million – or fair market value as determined by two independent appraisals – plus $20 million to fund the park’s construction, paid in annual installments of $666,667 for 30 years.

Magic City Innovation District

Tony Cho and Bob Zangrillo have drawn plans to build a $1 billion mixed-use project in Miami’s Little Haiti neighborhood.

Located just north of Wynwood and the Design District, Magic City Innovation District will span 17 acres and includes more than 200,000 square feet of rentable space within 20 buildings, warehouses and mixed-use spaces. It has drawn protests from local residents over concerns of displacement and gentrification.

The project’s plans include a 30,000-square-foot Magic City Studios and a 15,000-square-foot innovation center with startups, co-working space and other collaborations; an office tower; retail space; workforce housing and possibly a hotel. It’s planned for land between Northeast 60th and 64th streets.

Cho, founder and CEO of Metro 1, and Zangrillo, a venture capitalist, began assembling land in Little Haiti in 2012. Plaza Equity Partners, led by Neil Fairman, Anthony Burns and George Helmstetter, is also a partner in Magic City.

SkyRise Miami

Berkowitz is planning to build an observation tower next to Miami’s Bayfront Park downtown that he is pegging as the “Eiffel Tower” of Miami.

SkyRise Miami plans to feature various observation decks, an indoor controlled free-fall system and a “drop tower-style” ride featuring a 95-mile-per-hour descent. It was designed by Arquitectonica.

The ambitious tower could be among Florida’s tallest buildings at 1,000 feet. In October, the development group announced it hired Plaza Construction to begin construction on SkyRise Miami in the second quarter of 2019, with a completion date set for 2023, according to a release.

Berkowitz Development Group’s Jeff Berkowitz initially proposed SkyRise back in 2013, but lawsuits stalled the project, including one initiated after Miami-Dade County planned to award $9 million in public subsidies. The litigation ended in 2016 when Berkowitz stopped pursuing public funding. A Florida Supreme Court ruling in 2015 put to rest other legal challenges from community activists seeking to stop the development.

Berkowitz originally sought to raise $270 million for the development, more than half the project’s construction price tag, through 540 EB-5 investors.

Bess Freedman and Hall Willkie

Less than a year after being named co-president of Brown Harris Stevens, Bess Freedman has been tapped as the luxury brokerage’s first chief executive.

As CEO, Freedman will oversee operations in New York City, the Hamptons, Palm Beach and Miami — consolidating leadership of those regions for the first time. The promotion was announced Tuesday in a companywide email signed by Hall Willkie, who has been president of BHS since the 1990s. Willkie will continue to run brokerage operations in the firm’s eight New York City offices.

“This is a very important newly created position for our firm,” he wrote, noting that Freedman would focus on “big picture” issues such as marketing, technology and the integration of BHS’ regional offices.

Reached by phone Tuesday afternoon, Freedman said the change had been in the works for some time, as BHS’ owners recognized a need to better compete in the current market.

“We’re in such a crazy environment and it’s so competitive, you need to have somebody who can make decisions and get things done,” she said.

Founded in 1873, BHS has nearly 1,000 agents — including 500 agents in Manhattan who closed nearly $4 billion in sales in 2017, the firm said. BHS is owned by Arthur and William Lie Zeckendorf’s Terra Holdings. It was affiliated with Christie’s for 22 years until 2017, when the auction house opted to get into the brokerage game itself. Terra also owns Halstead Property.

Previously, major decisions had to be run up the food chain, but that structure meant the firm wasn’t as nimble as it could be.

“It was frustrating not to have the ability and authority to get things done,” Freedman said. “It wasn’t a seamless process. When you have all these different people, not everyone always agrees.”

Trained as a lawyer, Freedman was an assistant district attorney in Maryland before turning to brokerage. Prior to BHS, she spent 10 years at the Corcoran Group, where she rose to senior managing director of the firm’s East Side headquarters. In 2013, she joined BHS as managing director of sales and business development. She was named co-president in December 2017 and in that role, she’s challenged BHS’ reputation as a stodgy firm that hasn’t kept up with the times.

This year, Freedman spearheaded a flashy rebranding and she’s been a cheerleader for tech innovation. When StreetEasy introduced a series of money-making initiatives in 2017, Freedman was a vocal proponent of the Real Estate Board of New York’s syndicated listings. “We think it’s the right thing to do for the industry,” she told The Real Deal last year.

Freedman said BHS would continue to redefine its marketing, which will include a focus on “lifestyle” in 2019. She declined to detail BHS’ plans to grow regionally (if at all), but she confirmed that BHS is looking to add offices where it makes sense. The firm is currently looking to open a small retail space on the Upper East Side.

Freedman also dismissed rumors that BHS is on the sale block, even as major firms like Berkshire Hathaway circle New York looking for acquisitions.

“It’s completely ridiculous,” she said. “The owners don’t need to sell. But they really want to make us No. 1.”

Richard Barton, Jay Hoag, and Spencer Rascoff

Zillow Group’s stock has taken a beating on Wall Street, but two major shareholders just doubled down on their investments in the listings giant.

Richard Barton, the Seattle-based company co-founder and executive chairman, bought $19.2 million worth of Zillow stock last week, regulatory filings show. Meanwhile, Jay Hoag, a venture capitalist who sits on Zillow’s board of directors, shelled out $25 million to up his stake in the company.

Both scooped up discounted shares of Zillow after the stock price tumbled 20 percent in the wake of an earnings report on Nov. 6 that shook investor confidence. In its earnings report, Zillow acknowledged that revenue from its cash cow, Premier Agent, was lower than expected. The company laid out steps it was taking to address the issue, but that didn’t calm investor nerves.

In a statement following his stock purchase, Barton said he is committed to Zillow’s long term-vision, which includes buying and selling homes direct from consumers. He said Zillow’s work in bringing real estate data to light, “has set the stage for Act II: transforming the way consumers buy, sell, mortgage, and rent homes.”

Barton’s confidence, however, isn’t shared widely on Wall Street.

Following this month’s earnings report, Zillow’s stock price sank overnight to $29.99 per share from $40.74 per share. And on Nov. 7, investors traded 21.4 million shares of the company stock, compared to around 2.4 million on an average day. The price has been notching small improvements since, and closed at $33.47 per share on Tuesday.

Zillow faced blowback during the third quarter from changes it made to Premier Agent — including the addition of vetted buyer leads — which resulted in the loss of some agent advertisers. During the Nov. 6 earnings call, CEO Spencer Rascoff said that “Premier Agent issues are very solvable.” He said some changes have already been made; for example, Zillow is toning down its vetting of buyers so that agents receive more leads.

However, analyst Tom White of D.A. Davidson, said improved revenue from Premier Agent wasn’t likely until well into 2019 “at best.”

“For shorter-term investors, [Zillow] seems to have a lot on its plate,” he wrote in a Nov. 7 note.

But neither Barton nor Hoag are short-term investors.

Barton, a former Microsoft executive who also helped start Expedia and Glassdoor, was already one of Zillow’s largest shareholders. He owned 31.6 percent of the company’s total shares in April, when Zillow filed its most recent proxy statement.

To increase his stake, he paid between $26.95 and $28.14 per share between Nov. 16 and Nov. 20, filings show.

Hoag co-founded Menlo Park-based Technology Crossover Ventures, a growth equity fund that’s raised $12 billion since 1995. The firm was an early investor in Zillow, which went public in 2011. TCV has also backed the likes of Facebook, Expedia, Airbnb and Netflix.

Hoag purchased 850,000 shares of Zillow on Nov. 21, according to filings, including 600,000 shares priced at $29.08 and 250,000 shares priced at $29.47. He now owns 2.79 million shares of Zillow stock. Hoag joined Zillow’s board in 2005 and he also sits on the board of TripAdvisor, which was spun off from Expedia in 2011. Through a spokesperson, he declined to comment.

Wells Fargo Center at 333 Southeast Second Avenue

Metropolitan Life Insurance Co. just scored a $170 million refinance for its Wells Fargo Center in downtown Miami, property records show. The deal comes shortly after its $74 million purchase of a retail center in Wellington.

New York Life Insurance Company is the lender for the Wells Fargo office tower. The loan takes over a previous $144.4 million mortgage issued by Bank of America in 2015, and adds about $46.7 million to existing debt, records show.

The Wells Fargo Center at 333 Southeast Second Avenue adjoins the JW Marriott Marquis Hotel. The 47-story tower was completed in 2010 by a joint venture between the MDM Group and MetLife. A year later, MetLife took full ownership of the 752,845-square-foot office project.

Wells Fargo is the largest tenant with about 150,800-square-feet leased. Cushman and Wakefield’s Brian Gale, Andrew Trench, Ryan Holtzman and Jeannette Mendoza handle leasing.

Gale said the tower is currently 88 percent occupied to tenants including Western Union, Greenberg Traurig, Silversea Cruises and McDermott, Will & Emery; Deloitte. Annual asking rents range between $46 to $48 per square foot.

A representative from MetLife was not immediately available to comment.

Jerome Powell (Credit: Getty Images)

Ever-rising commercial real estate prices nationwide could be a risk to the stability of the U.S. financial markets, as they were in the last recession.

That was the assessment from the Federal Reserve in its inaugural financial stability report on Wednesday. Fed officials cited commercial real estate — in which purchase prices continue to outpace rent increases — as well as nonfinancial corporate borrowing as risks in its report, according to the Wall Street Journal.

Separately, some Fed officials have pointed out that the past two recessions were caused not by inflation, but by asset bubbles, such as real estate, which can be more difficult problems to solve.

The report is a result of efforts by former Fed Chairman Ben Bernanke to monitor weak links in the financial system following the crisis. Now, it comes at a time when market indicators show that economic growth is waning nationwide, as interest rates rise, according to the Journal.

It also raises less concern about risks stemming from household borrowing and in the banking sector. It said the chance that banks would misprice one asset such as real estate is low, according to the Journal.

The banking sector was well capitalized based on the report, though officials did express concern about the signs of increased borrowing at nonbank financial firms including hedge funds. This could be risky because nonbank lenders are increasingly making up a bigger share of the real estate lending landscape.

Fed Chairman Jerome Powell was expected to be in New York on Wednesday to speak about monetary policy and financial stability. [WSJ] — Keith Larsen

Rendering of Virgin Voyages terminal and Richard Branson (Credit: Getty Images)

Virgin Voyages unveiled its proposal for a multimillion-dollar terminal at PortMiami.

Virgin Group founder Richard Branson on Wednesday announced plans for the new 100,000-square-foot cruise terminal located on the northwest side of the port. Construction would begin if and when the Miami-Dade County Commission approves the project, which would be completed by November 2021.

The $150 million, two-story storm-proof glass terminal is being designed by Arquitectonica, according to a release.

Virgin’s Scarlet Lady ship will continue to dock in Miami through 2021 and the second ship will sail from Miami for the fall and winter cruise season of 2021/2022. Virgin recently became a minority investor in Brightline, which is rebranding to become Virgin Trains USA. The private passenger-train operator also recently filed with the SEC to go public.

Virgin isn’t the only cruise line to invested hundreds of millions of dollars into a new terminal at PortMiami. Earlier this year, Royal Caribbean unveiled a new 170,000-square-foot, ship-shaped facility, which it funded with a $247 million loan from Sumitomo Mitsui Banking Corp. and infrastructure support from the county.

In March, Norwegian Cruise Line Holdings unveiled its new PortMiami design scheduled for completion in the fall of next year.

From left: Rod Stewart, Donald Trump, Nelson Peltz and Ken Griffin (Credit: Wikimedia Commons, Getty Images)

Who pays the most property taxes in Palm Beach?

Citadel founder Ken Griffin is No. 1. His nearly $250 million assemblage in the South Ocean Boulevard corridor generated $3.66 million in property taxes this year.

That’s according to an analysis of new tax rolls in Palm Beach by the Palm Beach Daily News. Griffin’s estate includes 1290 South Ocean Boulevard (also known as 1265 South Ocean Boulevard), 70 Blossom Way, and 1285 South Ocean Boulevard.

A record number of 51 Palm Beach homeowners were billed at least $500,000 in taxes in 2018, up from 40 last year, according to the analysis.

Nelson Peltz, a hedge fund manager, and his wife Claudia, were the second highest taxpayers. Their North County Road estate rang up a $1.98 million tax tab. Its market value is pegged at $123 million.

Others in the top 51 ranking include President Trump, whose Palm Beach properties were taxed $899,864 based on a market value of $52 million. Trump had the 11th highest Palm Beach tax bill in 2018, 10 spots higher than last year, thanks in part to an $18.5 million purchase in late April.

Rod Stewart, Howard Stern, Frank McCourt and Sir Peter Wood also made the cut. Check out the full list here. [Palm Beach Daily News] – Amanda Rabines

VTS CEO Nick Romito

VTS is getting ready to launch a business that would cut brokers out of some commercial real estate deals.

The startup tech firm is planning to launch the platform early next year, and it will focus on letting landlords and tenants negotiate directly with each other on relatively small and simple commercial deals for less than 5,000 square feet, according to the Wall Street Journal. The system will work for larger deals as well, but those will likely still involve brokers.

The five-year old tech firm and has created software to help landlords keep track of leasing deals throughout the entire process. It has information on roughly 9 billion square feet of office space in the top 20 U.S. markets, which will serve as the foundation for their new platform.

VTS merged with its rival Hightower in 2016 and has raised $106 million from Blackstone and other venture capital firms. Co-founder Brandon Weber told The Real Deal earlier this fall that he would step back from his day job at the company but continue to sit on its board and work as an adviser to CEO Nick Romito. [WSJ] – Eddie Small

Jorge Pérez (Credit: iStock)

Miami developer Jorge Pérez plans to spend nearly half a billion dollars on new projects in the Phoenix market starting next year.

Pérez’s Related Group would build at least three new retail and residential developments in the Phoenix metropolitan area in 2019, he told an ABC affiliate in Arizona. Miami’s condo king said the properties would range from two- and three-story buildings to 10-story buildings.

The billionaire developer announced he was expanding to the Southwest with a new satellite office in Dallas nearly a year ago. Related said it planned on building apartments in Phoenix, Denver, Las Vegas and other major Texas markets.

Related has been diversifying its investments, branching out from building condominiums and affordable housing in South Florida. The company also has built projects in Argentina, Brazil, Panama, Uruguay and Mexico, and outside of Miami in Tampa.

In June, Related and Rockpoint Group launched a new division within Related to focus on acquiring value-add multifamily properties in Florida and throughout the Sun Belt.  [ABC 15 Arizona] – Katherine Kallergis