(Illustration by Tim Peacock)

It seems buying and selling e-commerce space these days can provide more value than an IPO — at least as far as Singapore’s GLP is concerned.

The massive logistics firm had been considering going public, according to a person familiar with the matter, but landed on a better way to feed its investors: selling a massive warehouse portfolio to Blackstone Group for $18.7 billion, one of the largest deals ever in industrial real estate.

Blackstone’s purchase of roughly 1,300 properties spanning 179 million square feet across at least nine states nearly doubled its U.S. industrial holdings in one fell swoop. And just a few days later, the New York-based private equity giant announced plans to pool $6.8 billion into a new urban warehouse company in Europe.

Of course, Blackstone has made plenty of other big industrial bets in recent years, including $1.8 billion for Canyon Industrial Portfolio’s last-mile properties across Chicago, Dallas and Baltimore, $2.6 billion for Canada’s Pure Industrial Real Estate Trust and $950 million for more than 100 warehouse assets, mostly concentrated in Southeastern states, from Harvard University’s endowment.

The scope of its deal with GLP, however, catapulted Blackstone to the lead spot in the burgeoning e-commerce property game in the U.S. — way ahead of other major players like Exeter Property Group, Clarion Partners and Duke Realty — and possibly around the world.

“This transaction fits perfectly with the strength of the Blackstone Real Estate franchise: large scale, high conviction, thematic investing,” Nadeem Meghji, the company’s head of real estate for the Americas, told The Real Deal in a statement. “We continue to be the largest investor globally in the logistics sector.”

A source with knowledge of GLP’s business strategy said the Singaporean firm still has major growth plans for North America’s e-commerce market, but the chance to sell a portfolio that cost it $8.1 billion in 2015 for more than double the price was just too good to pass up.

Others tapped into the “last-mile” warehouse market said Blackstone’s investments underscore the hard reality that a growing number of people would rather shop online than trek out to the store. And the faster they want those deliveries to arrive, many are betting, the more valuable warehouse space will become.

“Absent any economic shocks to the system, I don’t see warehouse demand going down,” said Innovo Property Group’s Andrew Chung, who has invested roughly $1 billion in industrial properties in New York City.

But some commercial real estate brokers say they’re already seeing a pullback from clients looking to buy and lease warehouse space due to the limited supply of tenants willing to pay the price per square foot they would want. And concerns about oversupply are starting to creep into places where land is cheaper and more readily available than New York.

“[My] instinct, having been in the business for 35 years, is when is the music going to stop, and lenders are starting to ask those questions,” said Joel Bergstein, whose Lincoln Equities real estate firm is working on multiple warehouse projects in the tri-state area. “But every day, demand continues.”

Close to home

While last-mile warehouse space might not be as alluring as the glistening spheres of Amazon’s Seattle headquarters, the seemingly endless e-commerce craze means one can’t exist without the other.

Industrial space across the country had a slim 7 percent availability rate and 4.3 percent vacancy rate at the end of 2019’s first quarter, according to the global commercial brokerage CBRE. That marks the lowest availability rate since 2000’s fourth quarter and the lowest vacancy rate since at least 2002.

The report also found that the U.S. saw just 33.2 million square feet of new industrial supply in the first quarter — a 20.5 percent drop year over year and a sign that demand could continue to rise.

Meanwhile, asking rents for industrial space throughout the country have been steadily increasing since 2011, according to Cushman & Wakefield, hitting an average high of $6.31 a square foot last year.

CBRE’s Brad Cohen, who focuses on landlord and tenant advisory services, said that with more online shoppers expecting their products to arrive in just a few hours max, warehouse space needs to be that much closer to bustling residential areas. Drone technology has offered hopes (and concerns) about those deliveries arriving from remote locations sooner, but that has yet to take hold in the U.S., especially in dense cities.

“The old model of having that distribution a few days’ drive away is no longer going to cut it when you want your product in an hour,” Cohen said. “Consumer buying behavior has changed dramatically.”

Blackstone’s not the only giant looking to capitalize on that.

Prologis spent $8.4 billion last year to buy rival logistics owner DCT Industrial Trust and expand its access to Seattle, South Florida and California, and Warren Buffett’s Berkshire Hathaway has been buying up shares of Amazon — disclosing this spring that it had purchased more than $860 million in stock at the end of March.

And on the sell side, Tom Barrack’s Colony Capital has reportedly tapped Eastdil Secured and Morgan Stanley to market a portfolio of last-mile warehouses and logistics buildings for upwards of $5 billion. Brookfield Asset Management is one of the potential suitors for the properties, Bloomberg reported in July.

Zach Aarons, co-founder of the venture capital firm MetaProp NYC, said there’s been a paradigm shift in recent years between how investors value warehouse and retail space.

“In 20 or 30 years, it’s all going to be one thing,” he said, noting that the industry could soon see “a merger between a Simon Property Group and a Prologis.”

“It’s all going to be one category, and I believe you’re going to see fewer and fewer REITs that just do malls and fewer and fewer REITs that just do logistics,” Aarons added. “There’s going to be … some transformational deal like that that’s going to usher in a new era of thinking about these categories.”

Some say that shift could start to take place in assets that have gone from symbols of America’s obsession with shopping to symbols of brick-and-mortar retail’s decline: traditional shopping malls.

The issue of vacant malls even made its way into the 2020 presidential campaign thanks to Democratic candidate Andrew Yang, who included the American Mall Act as one of more than 100 policy ideas on his website. The proposal stresses that as malls grapple with the ongoing rise of online shopping, there’s a growing urgency to rethink the use of such properties.

“Offices, churches, indoor recreation spaces, anything we can do to keep these spaces vital and positive is an enormous win for the surrounding community,” the candidate wrote on his website.

Yang’s campaign did not respond to multiple requests for comment.

“The era of guaranteed 100 percent occupancy in the shopping mall is over,” Aarons said. “So what do you do with this fallow real estate? Warehouse space in malls might be a really interesting growth angle.”

Sealing deals

Blackstone’s plan, boiled down, is to capitalize on the growing number of retailers moving their supply chains closer to customers in urban markets, according to the company.

Central to its massive warehouse deal was the firm’s belief that e-commerce will continue to rise in popularity, Ken Caplan, Blackstone’s global co-head of real estate, said in a statement. Another company executive, who asked not to be named, also pointed to the limited supply of last-mile warehouse space in big cities.

Though commercial brokers differ on how much of a game changer Blackstone’s purchase is, there was almost universal agreement that it was a good move for the firm.

Alexander Cocoziello, managing director of capital markets and investment at New Jersey-based Advance Realty Investors, said warehouse space “has the longest runway of any real estate asset class, so I’m imagining [Blackstone] has been trying to do this for a while.”

Robert Kossar, a vice chairman at JLL, described the private equity firm’s recent purchase as a turning point for the real estate industry. Kossar, who was not involved in the deal, said there was “significant demand” for the properties from several players.

Other companies that reportedly bid for the GLP portfolio include Prologis, which did not respond to requests for comment, and Brookfield, which declined to comment.

“You have another behemoth in the market,” Kossar said about Blackstone’s growing presence in the e-commerce property business.

Blackstone wouldn’t disclose its plans for specific assets in the GLP portfolio but indicated that it may look to sell some of the properties and hold onto others. The private equity firm is already in talks to sell a chunk of the assets to Prologis for about $1 billion, according to Bloomberg.

For now, though, Blackstone will tuck the portfolio under its Link Industrial Properties arm, which manages about 180 million square feet of industrial space around the country.

John Reinertsen, one of CBRE’s top brokers in the outer boroughs, said it’s not unusual for companies to shed industrial properties after buying in bulk.

“When you buy portfolios, sometimes there’s stuff in there that doesn’t really fit, and you can get rid of that immediately. The other properties need to be leased,” he said. “So you lease it up and make it more attractive and then spin it off, one by one.”

Industry cities

Demand for e-commerce warehouse space has remained strong from coast to coast — even in a city more commonly known these days for its economic struggles than successes.

Detroit had the lowest availability rate for industrial and logistics space in the first quarter of 2019 at just 3.1 percent, CBRE’s data shows. That was followed by Salt Lake City at 4.2 percent, while Milwaukee and Portland, Oregon, tied for third at 4.3 percent.

Los Angeles had an availability rate of 4.5 percent, while Miami’s was 5.2 percent and Chicago’s was 5.4 percent. CBRE does not have statistics yet for New York City, as it just recently started to track the last-mile market more closely.

But the vacancy rate for industrial space remains relatively low in the outer boroughs, according to Cushman. As of 2019’s second quarter, it was at 5 percent in Brooklyn, 5.8 percent in the Bronx and 6.1 percent in Queens, but slightly higher at 10.3 percent in Staten Island.

And the five boroughs saw 2.5 million square feet of industrial space leased overall last year, with 95 percent of those deals involving e-commerce and logistics tenants, according to JLL.

Innovo’s Chung is planning to build a roughly 840,000-square-foot warehouse on Bruckner Boulevard in the Bronx, and the company recently bought warehouses in Long Island City and Maspeth, Queens, for $114 million combined.

Other major New York warehouse projects include a four-story distribution center in Sunset Park, Brooklyn, which Dov Hertz’s DH Property Holdings is spearheading, and an industrial distribution center on the Red Hook waterfront that Joseph Sitt’s Thor Equities converted from a planned office project, as TRD previously reported.

At the same time, Amazon is planning to open a new distribution center on Staten Island that will span more than 850,000 square feet and still has its eyes on Brooklyn and Queens. The e-commerce giant is reportedly in talks to lease 1 million or more square feet near Industry City and is considering building a ground-up distribution facility in Maspeth, Crain’s reported late last month.

These days, Chung noted, even most big-box retailers deliver products to customers’ homes if they prefer. Walmart does not have a store in the five boroughs, but its e-commerce business Jet.com has leased a roughly 200,000-square-foot warehouse in the Bronx. And while Best Buy has several stores in the city, its closest warehouse is in Piscataway, New Jersey.

“Even if you buy in a store now, there’s an expectation to be able to have it delivered rather than having to carry it home,” Chung said.

The ground-up game

Average asking rents for industrial space in Brooklyn are now at about $20 a square foot, per Cushman, and several investors say newly built and renovated warehouses in the city can achieve rents upwards of $30 a square foot — comparable to prices that outer-borough office landlords were seeking a few years ago.

Jeff Milanaik, a partner at the industrial development and acquisitions firm Bridge Development, said he doesn’t expect demand for warehouse space in and around New York to fade anytime soon.

“It’s all focused on that same last mile,” he said.

But there’s a limit to how many warehouses people want to see in their neighborhoods.

Stephen Preuss, an investment sales broker at Cushman based in Forest Hills, Queens, compared the potential for a glut of new industrial buildings to the flood of luxury condos in New York and other major cities in recent years.

“When the first 10,000 come through, obviously there’s absorption,” Preuss said. “It’s the next 10,000 [where] you really have to see how absorption and rental levels stabilize.”

Oversupply is less of a concern in the Big Apple than some other markets, according to local players, given the city’s strict spatial restraints. Zoning laws limit the number of places where warehouses can be built, and several parts of the city that were once geared toward industrial development have since been taken over by residential projects.

The city’s population has added about 1.5 million people since the early 1980s, RXR Realty’s Seth Pinsky noted. “A lot of the places where we’ve accommodated that growth has been on formerly industrial land,” he said. “So, now you’ve got demand [for industrial space] that’s continuing to increase and supply that’s fixed or even diminishing, and it makes it a pretty favorable market for landlords.”

Just outside the city, warehouse space is now about as solid a bet as new residential space, Lincoln Equities’ Bergstein argued. His firm had been working on a project in the Meadowlands that it originally planned to build as a mixed-use development until shifting course to make it a 360,000-square-foot industrial property.

MetaProp’s Aarons pointed to two main factors driving up the amount of money investors can now make from warehouse space: “You’re able to charge higher rent because the market is really competitive now,” he noted. “And you’re delivering a level of service that you would have never thought possible to deliver 10 years ago.”

Bergstein said he expects to see competition for industrial space heat up among New York landlords and commercial brokers as the state’s new rent laws make multifamily deals less attractive than other commercial property types.

Blackstone, after all, is the largest owner of rent-stabilized apartments in the city, according to the Department of Housing Preservation and Development, in large part due to its $5.3 billion purchase of Stuyvesant Town–Peter Cooper Village with Ivanhoé Cambridge in 2015. And the private equity giant recently halted all apartment upgrades and other planned work at the 11,000-unit complexes, citing the legislation signed by Gov. Andrew Cuomo in June.

A spokesperson for Blackstone maintained that the GLP deal had nothing to do with its plans for Stuy Town, and that the company had been investing in logistics long before changes to New York’s rent laws were a concern.

But Bergstein maintained that the booming last-mile warehouse sector would soon see more entrants from the multifamily world.

“I think right now, based on the new rent regulation laws in New York City, all those guys want to get into the e-commerce and industrial business,” he said.

4611 North Federal Highway and Jon Bell of Bell Partners (Credit: Google Maps)

UPDATED, Aug. 5, 2:42 p.m.: Bell Partners bought an apartment complex in Pompano Beach for $58.5 million, adding to the multifamily properties it already owns in South Florida.

The Greensboro, North Carolina-based company paid $235,000 per unit for the property at 4611 North Federal Highway. M-M Properties, a Houston-based privately held real estate firm, sold the 392,222-square-foot complex to Bell Partners.

Chris Conklin of Walker & Dunlop represented the seller.

Monthly rents start at $1,424 for a one-bedroom.

M-M built completed the complex in 2016 after purchasing the site in 2013 for $7.1 million.

Bell Partners has nearly 55,000 units under management and says it is one of the biggest apartment renovators in the industry, according to the firm’s website. In Florida, it owns 32 properties with 9,446 units, including communities in Boca Raton, Pembroke Pines, Coconut Creek and Parkland.

In February, Bell Partners paid about $62 million for an 240-unit apartment complex in Miramar. A few months prior in September 2018, Bell Partners bought the Sheridan Village apartment complex in Pembroke Pines for $91.8 million, property records show.

Pompano Beach is experiencing a wave of redevelopment.

The city of Pompano Beach and the Pompano Beach Community Redevelopment Agency recently announced they are looking for bidders to redevelop a 30-acre assemblage within the city’s planned downtown innovation district.

In May, San Diego-based Fairfield Residential scored a $56.5 million loan to build its Fairfield Pompano apartment project at 601 North Federal Highway, near Pompano Community Park and Pompano Beach High School.

Michael Shvo

New York developer Michael Shvo and his partners Bilgili Holdings and Deutsche Finance America closed on two South Beach hotels neighboring the Raleigh Hotel.

After buying the Raleigh property for $103 million in February from Tommy Hilfiger and the Dogus Group, the Shvo group revealed the closing prices for the two adjacent properties. The group paid $87.85 million for the Richmond Hotel, at 1757 Collins Avenue, and $52 million for the South Seas at 1751 Collins Avenue, according to a spokesperson.

In all, Shvo and his partners paid $242.85 million for the three hotels. The group financed the deals with a $100 million acquisition loan from California-based Acore Capital. Lotus Capital Partners arranged the financing.

The deals closed on Monday, just days after the Miami Beach City Commission approved an ordinance that will allow property owners who own 115,000 square feet of land to build “ground level additions” up to 200 feet high in a zone that includes Shvo’s properties.

Shvo hired architect Kobi Karp to design the 2.9-acre project, which involves restoring the South Seas and Richmond hotels.

The Raleigh, an 83-room Art Deco hotel at 1775 Collins Avenue, sold for about $1.24 million a key, one of the most expensive hotel sales on a per-room basis in Miami-Dade County. The Raleigh had been closed since Hurricane Irma hit South Florida in September 2017.

The Richmond has 92 rooms in a four-story, nearly 52,000-square-foot building. It was built in 1941 and sits on a 32,670-square-foot lot, records show. Patti and Allan Herbert, who represent the third generation of the family that has owned the hotel since its inception, sold the property to Shvo.

The Richmond deal included the apartment building at 1757 James Avenue and the parking lot at 1832 James Avenue, the spokesperson said.

The South Seas, a 118-key, four-story, 50,386-square-foot building, was built in 1941 on a 32,500-square-foot lot.

The Richmond and South Seas acquisitions mark the fourth and fifth joint venture between Shvo, Bilgili Group and Deutsche Finance. They also own 9200 Wilshire in Beverly Hills and the office portion of 685 Fifth Avenue, which is now being converted into a Mandarin Oriental Residences.

Serdar Bilgili is the owner of the Istanbul-based real estate private equity firm BLG Capital.

Gas leak at Edgewater construction site (Credit: Katherine Kallergis)

A gas leak at an Edgewater construction site shut down a portion of Biscayne Boulevard on Monday afternoon.

The leak occurred at 3400 Biscayne Boulevard in Miami, according to city of Miami Fire Rescue Captain Ignatius Carroll. It’s the site of the AC Hotel by Marriott, which is nearly completed.

Carroll said the leak had been mitigated and Teco Peoples Gas was on the scene. The southbound lanes of Biscayne Boulevard were temporarily closed between Northwest 33rd and 36th streets.

3H Group, the developer behind the 153-room hotel, closed on a $21.3 million construction loan for the project in April 2018. Hemant Patel’s Arti Hersi Inc. also owns a stake in the project.

Kobi Karp designed the seven-story hotel, which will feature a restaurant and bar, a rooftop pool, fitness center and meeting rooms. It will also share a 217-space parking garage with the adjacent Hampton Inn & Suites Miami Midtown.

Midtown Lodging 2 LLC paid $1.25 million for the former Midtown Inn Miami site in 2018, and knocked down the building shortly thereafter. The property is a few blocks away from the Shops at Midtown Miami and the Miami Design District.

In July, a gas explosion at a Plantation shopping center injured nearly two dozen people. Portions of the shopping center, owned by Edens, are expected to be demolished now that the building is structurally unsound, the city’s fire chief previously said.

Midtown Delray Beach rendering

Boca Raton-based Pebb Capital is set to acquire the Midtown Delray Beach mixed-use development site for $40 million, now that a legal fight between the project’s original owners has ended, The Real Deal has learned.

Pebb Capital negotiated a contract earlier this year to acquire the Midtown Delray Beach property for the same $40 million price, but the planned Feb. 28th closing of the deal was scuttled by a dispute between the two companies that assembled the development site.

Todd Rosenberg, managing principal of the Pebb Capital, said Monday that his firm has a new contract to pay $40 million for the 7-acre development site on West Atlantic Avenue within an Opportunity Zone in Delray Beach, and he expects the transaction to close within 75 days.

Rosenberg also said Pebb Capital may be able to break ground by the second quarter of 2020 for construction of Midtown Delray Beach.

Hudson Holdings, led by Steven Michael, and Marshall Florida Investments, led by Rick Marshall, assembled the site with parcel purchases totaling $26 million.

But after they negotiated a $40 million sale of the project to Pebb Capital, the principals of Hudson and Marshall Florida disagreed over their shares of the proceeds. The dispute “had to do with the amount that Hudson stood to make from this [$40 million] transaction,” Rosenberg said.

He said Pebb Capital failed to close under its first contract to buy Midtown Delray Beach by a contractual deadline of Feb. 28th because the “due diligence process was frustrated by the members of Hudson because of their dissatisfaction.”

Hudson subsequently sued Marshall Florida and entities of Pebb Capital in Palm Beach Circuit Court. The case was settled after Marshall Florida bought out Hudson’s equity interest in the Midtown Delray Beach development, Rosenberg said.

“Hudson is no longer an owner,” he said. “Marshall was successful in purchasing Hudson’s interest out.”

Michael, the Hudson Holdings principal, did not respond to requests for comment.

Pebb Capital might make some “minor tweaks” to alter elements of the project, Rosenberg said, but he ruled out a major redesign of Midtown Delray Beach. It is designed to include nearly 50,000 square feet of retail and restaurant space and about 90,000 square feet of office space, plus about 100,000 square feet of residential units or hotel space.

Rosenberg said the total project cost will be near $120 million, and the location of the Midtown Delray Beach site in a federal Opportunity Zone will allow Pebb Capital to offer tax benefits to potential investors.

“There’s no issue on our part with being able to capitalize the deal, between the debt and the equity,” Rosenberg said. “There are plenty of options for that.”

Jenna and Keith Keltner, 1749 Southeast 13 Street Fort Lauderdale (Credit: V’s Barbershop)

The owners of a V’s Barbershop, linked to the family that owned the historic Yankee Clipper hotel, sold their waterfront Fort Lauderdale estate for $9.5 million.

Jenna and Keith Keltner sold the 6,055-square-foot home at 1749 Southeast 13th Street for $1,568 per square foot to a Nevada company called Grace 1749.

The home has five bedrooms and seven bathrooms. Its amenities include a wine room, gym, an open floor plan, eat-in gourmet kitchen and master bedroom on the ground level with dual baths and walk-in closets. It was designed by Tuthill Architecture.

The property also has 320 feet of water frontage and a 45-foot boat slip. The home was built in 2017 and was listed for $10 million in March. Tim Elmes of Coldwell Banker Residential Real Estate had the listing. The buyer was represented by Darin Tansey of the Eklund-Gomes team of Douglas Elliman.

The land was inherited by Jenna Keltner, whose family owned the historic Yankee Clipper hotel in Fort Lauderdale Beach that resembled a cruise ship.

The iconic resort opened in 1956 as the Sheraton Yankee Clipper. It was often featured in films over the past decades, including the 1999 movie “Analyze This,” starring Robert DeNiro and Billy Crystal. The family sold the hotel in 2005. It is now known as the B Ocean Resort.

The Keltners are currently the franchise owners of V’s Barbershop in Fort Lauderdale, the popular barbershop’s first location in South Florida. Keith Keltner was formerly a marketing and operations specialist who worked at the Boca Raton-based headquarters for Office Depot. Jenna Keltner previously helped Spirit Airlines during its IPO, according to V’s Barbershop in Fort Lauderdale’s website.

Fort Lauderdale’s luxury residential sale prices generally pale in comparison to the high-end homes on Miami Beach or Palm Beach, but the area has seen a number of big sales in recent months.

In May, a major used-car dealer paid $17.36 million at auction for a waterfront Fort Lauderdale mansion, marking the most expensive single-family home sale in the city over the last 18 months.

Compass CEO Robert Reffkin and CCO Matt Spangler (Credit: Getty Images and Compass)

A day after Uber laid off a third of its marketing team, Compass’ Matt Spangler snapped into action. On Twitter, the brokerage’s chief creative officer retweeted a Google spreadsheet listing those impacted and invited them to check out Compass’ open roles.

And there are many.

After announcing a $370 million funding round on July 30, the $6.4 billion brokerage continues to look to scale. Though Spangler’s tweet is fairly common in tech and creative circles, it speaks to the different trajectories of a post-IPO company looking to right-size and a VC-backed firm that’s still scaling up. On Monday, Uber said it laid off a third of its marketing team, or about 400 people, as the ride-hailing company tries to cut costs and streamline its operations after going public in May.

“That’s the war for tech talent,” one source said.

This is wonderful and super helpful. Hi @Uber talent, @Compass is hiring and we’d love to hear from you! Check out our open roles https://t.co/dweS2hlre7 https://t.co/dswpbP7id6

— mattspangler (@mattspangler) August 1, 2019

Nationwide, the tech sector added 56,400 jobs during the first half of the year, according to an analysis of Department of Labor statistics. That compares to 49,700 jobs added during the first half of 2018.

Founded in 2012, Compass has made a point of hiring talent from brand-name companies such as Google, Microsoft and McKinsey. “Depending on the jobs available and the fit with the recently laid off Uber employees, it could be great,” one investor said of Spangler’s tweet.

Nationwide, Compass currently has 13,000 agents around the country — up from roughly 10,000 in January — and sources said it’s likely to hit 15,000 to 20,000 agents by the end of the year. It also has 2,200 employees and it’s in the midst of tripling its product-and-engineering team. (It currently has 320, of which 200 were hired in 2019. Compass’ website is currently advertising another 71 engineering jobs.)

“We’re going to accelerate our growth in two key areas — one is product and engineering,” CEO Robert Reffkin said last week on CNBC. “And we’re going to double down on our core products,” including Compass Concierge, which fronts sellers the money for home repairs.

As Compass weighs an IPO, it will probably have to rethink its spending — as others have done. Ahead of its IPO, Lyft laid off 50 people in its bike and scooter division, a move the company said was part of its “performance management process.”

And in June, Opendoor — which allows consumers to sell homes online and was most recently valued at $3.8 billion — laid off 50 of its 1,300 employees and ended its free lunch perk. A spokesperson for the SoftBank-backed company said it is “streamlining” certain operations as it continues to grow.

The We Company also conducted a round of layoffs and cut back on perks like salmon-and-bagel breakfasts in 2016. This past March, as it prepares to go public, it laid off as many as 300 employees — or 3 percent of its workforce, as The Real Deal reported. The layoffs were positioned as performance-related.

Condo sales volume in Miami-Dade rose toward the end of July.

A total of 162 condos sold for $62 million in Miami-Dade County last week, up from 120 closings for $42 million the previous week. Condos last week sold for an average price of about $383,000 or $292 per square foot.

Unit 1509 at Il Villaggio in Miami Beach sold for $3.55 million, marking the priciest sale of the week. The three-bedroom, 2,801-square-foot unit was on the market for 319 days. It sold for $1,267 per square foot. The listing agent was Devin Kay, and Andrew Katz brought the buyer.

The second most-expensive sale was the $2.8 million closing of Cloisters on the Bay unit 1201. After 192 days on the market, the Coconut Grove unit sold for $456 per square foot. Valaree Byrne represented the seller, while the buyer’s agent was Riley Smith.

Here’s a breakdown of the top 10 sales from July 28 to Aug. 3. Click on the map for more information:

Most expensive
Il Villaggio #1509 | 319 days on market | $3.55M | $1,267 psf | Listing agent: Devin Kay | Buyer’s agent: Andrew Katz
Least expensive
Jade Ocean #2307 | 5 days on market | $990K | $669 psf | Listing agent: Gabriel Souza | Buyer’s agent: Eitan Gontovnik
Most days on market
Rise at Brickell City Centre #3801 | 810 days on market | $2.4M | $603 psf | Listing agent: R. Viviana Junc | Buyer’s agent: Silvana Recalde
Fewest days on market
Jade Ocean #2307 | 5 days on market | $990K | $669 psf | Listing agent: Gabriel Souza | Buyer’s agent: Eitan Gontovnik

Stuart Miller and Southwest 152nd Avenue in Homestead

UPDATED, Aug. 6, 10:20 p.m.: Lennar Corp. paid $22.1 million for roughly 85 acres in Homestead as it continues its strategy of buying land in south Miami-Dade County.

The Miami-based homebuilder bought the property, west of Southwest 152nd Avenue, for about $260,000 per acre. Clifford Lincoln, a trustee of Keys Gate III, tied to Keys Gate Realty, is the seller.

The property is zoned for 770 residences, which breaks down to 117 single homes, 349 townhomes and 304 villas, according to the South Dade Newsletter.

Lennar and other homebuilders have been buying up land in South Dade, in part due to the rising cost and lack of land elsewhere in the county.

In May, Lennar launched sales and broke ground on a new housing community near Princeton.

In April 2018, Lennar paid $4.5 million for 32.7 acres of farmland near Zoo Miami. The company also spent nearly $11 million in 2017 for about 77 acres in Homestead, just west of the Turnpike along Mowry Drive and Southwest 152nd Avenue.

Among homebuilders, Lennar is one of the most aggressive land buyers. Historically, the strategy has paid off and has led to Lennar emerging as the country’s largest homebuilder thanks to its reasonably priced single-family homes.

Recently, a number of indicators, however, show that the housing market is slowing down.

While the company’s profit, revenue and home deliveries rose in the second quarter thanks to lower mortgage rates and strong incentives offered to homebuyers, Lennar also reported that tariffs on Chinese goods are also costing the company an average of about $500 per home.

That could be a bad sign for homebuilders since labor costs have risen significantly in recent years, making profitability more challenging.

Joseph La Rosa

Real estate agents across the Sunshine State may have to think twice before hitting send on a mass text.

La Rosa Realty, a Celebration-based brokerage with four offices in South Florida, was sued in Miami federal court for allegedly spamming Aventura real estate agent Alexander de la Cruz with an offer to make commissions of 33 percent.

In March, separate federal lawsuits were filed against Coldwell Banker and Naples-based Marzucco Real Estate alleging similar instances of unsolicited spamming via text messaging that run afoul of federal consumer protection laws.

According to de la Cruz’s July 31 complaint, La Rosa Realty violated the Telephone Consumer Protection Act by using an automated dialing system to send him a telemarketing text message without his prior consent. Like the two other lawsuits, de la Cruz is seeking class action status for his complaint, alleging that thousands of other unidentified people received the same text.

De la Cruz and his attorney Garret Berg declined comment. La Rosa Realty founder Joseph La Rosa did not respond to phone and email messages seeking comment.

De la Cruz alleges that on or about June 1, La Rosa Realty sent a text to his cellphone that said, “Dear Colleague, expand your market to Florida: Orlando & surrounding. Get 33% REFERRAL COMMISSION.” According to the lawsuit, the impersonal and generic nature of the text demonstrates La Rosa Realty utilized an automated system to transmit the message. And the text originated from a telephone number de la Cruz believes is owned and operated by the Central Florida brokerage, the lawsuit states.

“The systems utilized by the defendant have the capacity to store telephone numbers using a random or sequential generator, and to dial such numbers from a list without human intervention,” the suit states. “Upon information and belief, defendant has placed automated and/or prerecorded calls to cellular telephone numbers belonging to thousands of consumers throughout the United States without their prior express consent.”

Two months ago, Steven Grossberg alleged in his lawsuit against Coldwell Banker that he received a flood of unwanted text messages advertising the company’s listings. In the other lawsuit, Christian LaRosa accused a Marzucco agent of sending him texts asking for his email address and offering to “get your home sold within 60 days!”

According to the West Palm Beach online federal court docket, Grossberg’s lawsuit has been stayed pending a Federal Communications Commission revision of what defines an automated telephone dialing system. Meanwhile, in other case, Marzucco and LaRosa entered into a confidential settlement on July 31.

Donald Trump, Nicolás Maduro, and Trump World Tower (Credit: Getty Images and iStock)

Prior to President Donald Trump placing an economic embargo on Venezuela, Trump’s business was selling condos to supporters and associates of the country’s leader Nicolás Maduro.

More than six Venezuelans tied to either Maduro or his predecessor, Hugo Chavez, purchased Trump condos in New York City and South Florida before Trump became president, according to Politico. Several of the Venezuelans faced serious allegations of financial fraud in Venezuela.

The sales weren’t illegal, but the buyer’s backgrounds were suspicious, according to Politico. Real estate agents, developers and sales associates have little obligation to flag suspicious transactions where money laundering is alleged to have occurred.

In one instance, Roberto Rincon, who pleaded guilty in 2016 to bribing officials at Venezuela’s state-owned oil company, acquired a Trump condo in Florida. Other Venezuelan buyers at Trump properties include Juan Montes, a former corporate manager of finance and investments at PDVSA. A Marshall Islands shell company connected to a Montes business associate purchased a Trump Palace in Sunny Isles Beach in Florida for $1.95 million in April 2008.

One of the most well-known Venezuelan purchasers of Trump condos is Moris Beracha, a businessman who had ties to the Venezuelan government.

Last year, some of the country’s top officials purchased condos and high-end real estate in South Florida, including at the Porsche Design Tower in Sunny Isles Beach and multimillion dollar houses in Cocoplum.

Some of those assets have been seized by the U.S. government as part of a money laundering investigation. [Politico]—Keith Larsen

Brett David and a rendering of the auto spa

Luxury car dealer Prestige Imports is adding another facility to its over 10-acre North Miami Beach campus: Prestige Auto Spa, a car wash, gas station, restaurant and retail project.

The 17,000-square-foot auto spa, at 15180 Biscayne Boulevard, is set to open by the fall, CEO Brett David told The Real Deal. Juice & Java, a health food concept based in Miami Beach, will open in a 3,100-square-foot space. Another retail concept is also expected to open there.

Prestige paid nearly $15 million for property in 2015.

“Instead of tearing down this [2.6-acre] property, we saw a need in the marketplace for a luxury car wash, auto spa, a fully streamlined system where it’s a concierge-type of experience,” David said. The company spent about $2 million on the buildout.

A customer will be greeted by a porter who will take their order as they wait at Juice & Java, for example. “Your vehicle is up front, ready to go by the time you finish your meal,” he said.

Sunshine Gasoline is the distributor for Prestige Energy, a gas station that will offer full service at the auto spa. Later this year, it will feature an electronic supercharging station, as well as a high octane fuel. In addition to the standard self-serve and full-serve car wash, David said the facility will offer tire and wheel change, ding and dent repairs, full lube service and ceramic coating.

Prestige has been expanding its land assemblage. In 2016, a year after buying the auto spa property, it spent $12.5 million to acquire the former Walgreens at 15050 Biscayne Boulevard, which is now a Prestige Imports showroom.

Prestige was founded by the late Irv David, Brett’s father, who started the company by converting a gas station into a dealership. Now, the company also has the Prestige Aviation and Prestige Marine brands, and has acquired about 10.5 acres along Biscayne Boulevard in North Miami Beach.

Lamborghini Miami outgrew its space at 14800 Biscayne Boulevard, and will be moving into the former Audi property at 14780 Biscayne Boulevard, David said. The building at 14800 Biscayne will become a pre-owned Lamborghini showroom.

Prestige also owns the former Gourmet Diner at 13951 Biscayne Boulevard, where Mignonette opened and closed its second restaurant. David said he is working with a new tenant to take the space.

David works with luxury developers like Gil Dezer. In 2017, David reached out to Dezer to house some of his most expensive cars at Porsche Design Tower during Hurricane Irma.

From left: Tom Barrack, former Qatari Prime Minister Hamad bin Jassim bin Jaber Al Thani, and Saudi Crown Prince Mohammad bin Salman.

Play “six degrees of separation” with Middle Eastern investors active in the U.S. real estate market, and chances are Tom Barrack’s name would pop up.

The founder of Colony Capital is under scrutiny for his ties to the wealthy Middle Eastern nations of Saudi Arabia and the United Arab Emirates. Federal prosecutors are looking at whether Barrack, whose firm took in $1.5 billion from those two countries since his close friend Donald Trump won the Republican presidential nomination, sought to sway the Trump campaign and later the administration when it came to foreign-policy decisions.

Barrack, an Arabic speaker of Lebanese descent, has not been accused of any wrongdoing. But over his career, he’s developed deep ties to the Middle East and has been one of the most successful industry figures at bringing in money from wealthy investors there.

His dealings in the region date back to the 1970s, when he was a lawyer at the firm of Herbert Kalmbach, who had served as President Nixon’s personal attorney and was a prominent character in the Watergate scandal.

In 1972, a client at Kalmbach’s firm asked him to play squash with some local Saudi contacts, and he ended up partnering with the son of the king of Saudi Arabia, according to an account in The Hill.

“I had no idea who he was, but my boss said, ‘However much he wants to play, you play,” Barrack said in a 2014 speech at the Lebanese consulate in L.A. “We ended up playing three hours a day.”

Teaming up

Middle Eastern investors have poured billions of dollars into Colony Capital over the years.

After teaming with Saudi Prince Prince Alwaleed bin Talal on the Fairmont chain in 2006, Barrack partnered with the Qatar Investment Authority to buy Miramax Films for $660 million four years later. They sold the company to Doha-based beIN Media Group for an undisclosed sum.

And in 2011, amid the upheaval of the Arab Spring, Barrack swam against the current by saying he would be “looking hard” at expanding his then-$200 million worth of investments in the region.

“The time to buy is when everybody else is running for the hills,” he said at the time. “The Middle East is printing money and it’s used to operating in chaos.”

A year later, Colony sold several luxury properties in Sardinia to Qatar’s sovereign wealth fund, a move that prompted Italian prosecutors in 2017 to accuse him of avoiding taxes in the deal.

The New York Times reported that Colony has raised more than $7 billion in investments since Trump’s nomination, nearly a quarter of it coming from Saudi Arabia or the United Arab Emirates.

Barrack’s support for Trump has complicated his relationships in the region, particularly after the president’s 2015 comments on the presidential campaign trail that called for a temporary but “total and complete shutdown of Muslims entering the United States.” The Times uncovered emails in which Barrack tried to assuage United Arab Emirates Ambassador Yousef al-Otaiba’s concerns over the ban. The emails were regarding those 2015 comments, which Trump, as president in 2017, switched to a travel ban on people from majority Muslim countries. The UAE, Saudi Arabia and Qatar were never on the list of banned nations.

“We can turn him to prudence,” Barrack wrote in an email at the time, referring to Trump. “He needs a few really smart Arab minds to whom he can confer — u r at the top of that list!”
Pushing back
Barrack appears to have chosen his business over a closer role with Trump’s White House. The White House has offered Barrack at least one job before — in mid-2017 he was considered for U.S. Ambassador to Mexico, but that never happened.

Barrack says he has also pushed back on Trump over his more divisive comments about the Middle East. In June 2017, when the president called Qatar a “funder of terrorism at a very high level,” Barrack reportedly told him, “you don’t need to get involved.”

A month earlier, Qatar’s neighbors Saudi Arabia, the UAE, Bahrain, and Egypt severed diplomatic ties and blockaded the tiny nation. It was done over claims that Qatar financed terrorism and was becoming too close with regional rival Iran, which supports Houthi fighters in Yemen fighting a civil war against the Saudi-backed Yemeni government. The blockade remains in effect.

The split between Qatar and its neighbors put Barrack in a difficult spot, since he had deep connections with both sides. Two years ago, he filed plans for a 77,000-square-foot mega-mansion in Bel Air. But this palace was not for him. Barrack filed the design, sources said at the time, on behalf of former Qatari Prime Minister Hamad bin Jassim bin Jaber Al Thani.

At a February business summit in Abu Dhabi, Barrack jumped to the defense of Saudi Arabia’s Crown Prince Mohammed bin Salman after the kingdom admitted dissident journalist — and U.S. resident —Jamal Khashoggi was killed inside the embassy in Istanbul.

“… The atrocities in America are equal or worse to the atrocities in Saudi Arabia,” Barrack said, at the event hosted by CNN. “The atrocities in any autocratic country are dictated by the rule of law. So for us to dictate what we think is the moral code there when we have a young man and a regime that’s trying to push themselves into 2030 I think is a mistake.”
Barrack later apologized for the remarks, calling the October 2018 killing “atrocious” and “inexcusable.” The CIA has found credible evidence to conclude bin Salman ordered Khashoggi’s execution.

Barrack now appears to be reducing his role at Colony. The firm announced in July that he would step down as CEO as part of a merger with Digital Bridge Holdings that will see Digital Bridge CEO Marc Ganzi take the reins. Barrack will return to his role as executive chairman when the merger is completed sometime in the next two years.

Saudi Arabia’s sovereign wealth fund invested in a $4 billion Colony-Digital Bridge fund, a deal that preceded the recent merger.

Every day, The Real Deal rounds up South Florida’s biggest real estate news, from breaking news and scoops to announcements and deals. We update this page at 9 a.m., 12:30 p.m., and 4 p.m. ET. Please send any tips or deals to tips@therealdeal.com

This page was last updated at 4 p.m.

Prior to President Donald Trump placing an economic embargo on Venezuela, Trump’s business was selling condos to supporters and associates of the country’s leader Nicolás Maduro. More than six Venezuelans tied to either Maduro or his predecessor, Hugo Chavez, purchased Trump condos in New York City and South Florida before Trump became president, according to Politico. Several of the Venezuelans faced serious allegations of financial fraud in Venezuela. [TRD]

Luxury car dealer Prestige Imports is adding another facility to its over 10-acre North Miami Beach campus: Prestige Auto Spa, a car wash, gas station, restaurant and retail project. The 17,000-square-foot auto spa, at 15180 Biscayne Boulevard, is set to open by the fall, CEO Brett David told The Real Deal. Juice & Java, a health food concept based in Miami Beach, will open in a 3,100-square-foot space. Another retail concept is also expected to open there. [TRD]

Play “six degrees of separation” with Middle Eastern investors active in the U.S. real estate market, and chances are Tom Barrack’s name would pop up. The founder of Colony Capital is under scrutiny for his ties to the wealthy Middle Eastern nations of Saudi Arabia and the United Arab Emirates. Federal prosecutors are looking at whether Barrack, whose firm took in $1.5 billion from those two countries since his close friend Donald Trump won the Republican presidential nomination, sought to sway the Trump campaign and later the administration when it came to foreign-policy decisions. [TRD]

Another brokerage was sued for allegedly spamming real estate agents via text message. La Rosa Realty, a Celebration-based brokerage with four offices in South Florida, was sued in Miami federal court. The suit follows separate lawsuits filed earlier this year against Coldwell Banker and Naples-based Marzucco Real Estate alleging similar instances of unsolicited spamming via text messaging that run afoul of federal consumer protection laws. [TRD]

Barneys files for bankruptcy. Less than a day after reports that the department store chain was in talks for a bankruptcy loan, Barneys has secured $75 million in financing from Gordon Brothers and Hilco Global and filed for Chapter 11 bankruptcy as it plans for a formal sales process. The chain plans to close 15 of its 22 locations, but the Madison Avenue flagship — which accounts for one-third of the company’s revenue and has recently seen its annual rent nearly double — will remain open. [NYT]

Lennar acquires more land in South Dade. The country’s biggest homebuilder paid roughly $22 million for 79 acres in Homestead, west of Southwest 152nd Avenue. A trust tied to Keys Gate Realty sold the assemblage for nearly $280,000 per acre. [TRD]

The most-expensive condo sale in Miami-Dade last week was the $3.55 million closing of a unit at Il Villaggio in Miami Beach. Weekly condo sales volume totaled $62 million, about $20 million more than the previous week. [TRD]

Puerto Rico’s hotels and condos hit by political turmoil. The island’s lodging and luxury housing markets, still recovering from the fallout of Hurricane Maria, the Zika virus and a debt crisis, took another blow last week when Gov. Ricardo Rosselló resigned amid protests and scandal. Blackstone, which bet bit on the island’s promise in 2005, recently sold one hotel to a local builder and is looking to sell another. [WSJ] 

Investment bankers angle for lead role in WeWork IPO. With a relationship cultivated over many years and many deals, JPMorgan is expected to take first position in The We Company’s IPO syndicate, but rivals Goldman Sachs and Morgan Stanley are close behind. JPMorgan has been the company’s — and CEO Adam Neumann’s — biggest lender, and is helping arrange an unconventional a $6 billion debt package that depends on the IPO raising at least $3 billion. [Bloomberg]

Inter Miami CF partner Jorge Mas plans to have the Miami Freedom Park stadium completed by 2022. The David Beckham-led group expects to spend its first two years at Lockhart Stadium in Fort Lauderdale, beginning in March 2020, and then move to Miami. Beckham has gone through multiple locations in Miami since he first started scouting properties years ago, but appears to be moving forward with the Melreese property near Miami International Airport. [Sun Sentinel]

Pebb Capital will acquire the Midtown Delray Beach mixed-use development site after all. Boca Raton-based Pebb will pay $40 million for the 7-acre property, in an Opportunity Zone, now that a legal fight between the project’s original owners has ended. The firm could break ground on Midtown Delray Beach by the second quarter of 2020. [TRD]

The owners of a V’s Barbershop franchise, linked to the family that owned the historic Yankee Clipper hotel, sold their waterfront Fort Lauderdale estate for $9.5 million.
Jenna and Keith Keltner sold the 6,055-square-foot home at 1749 Southeast 13th Street for $1,568 per square foot to a hidden buyer, a Nevada company called Grace 1749. [TRD]

Compass wants laid-off Uber employees to join their company. Just one day after Uber laid off a third of its marketing team, Compass’ chief creative officer Matt Spangler tweeted that they should come check out the open roles at Compass. The brokerage firm just announced a $370 million funding round on July 30 and in the midst of tripling its product-and-engineering team. [TRD]

FROM THE CITY’S RECORDS

Argentic Real Estate Investment LLC provided a $27 million loan to GV-IP 110 Tower Owner LLC for the 110 Tower, at 110 Southeast Sixth Street in Fort Lauderdale.

Compiled by Katherine Kallergis

President Donald Trump and China’s President Xi Jinping at a press conference in Beijing in 2017

The multibillion-dollar trade war between the United States and China hit a boiling point this summer, with the real estate industry caught in the crosshairs.

In June — more than a year after firing his first salvo and levying tariffs on solar panels from China — President Donald Trump threatened the People’s Republic with another $350 billion in taxes on goods. Chinese President Xi Jinping quickly responded by jacking up tariffs on $60 billion of U.S. goods.

Much of the attention about the trade war, which is closing in on 400 days, has been on U.S. consumers getting hit with price increases on everything from washing machines to computers.

But the real estate industry is also feeling the effects. For developers, that will come largely in the form of pricier raw construction materials such as steel, cooling equipment and granite countertops. And that will make it trickier to plan and budget new projects.

“From a development perspective, you’re doing your deals two to four years out, so you want more predictability and less volatility,” developer Daren Hornig of Hornig Capital Partners told The Real Deal in May. “If we could just put this one behind us and get this trade deal resolved, that would make a lot of people globally very happy.”

Trump and Xi held high-profile talks at the G20 Summit in Japan in June. But there’s been little sign of progress since, and last month, China reportedly urged the Trump administration to “make up its mind” about reaching a trade deal.

Although Trump’s main target has been China, the White House has also imposed tariffs on goods from Canada, India, Mexico and the European Union — arguing that those trading partners (all historically U.S. allies) have taken advantage of U.S. policy and dumped cheap products on the market here while also undercutting domestic manufacturing. Each of those partners has retaliated with its own levies on U.S. goods.

Below is a rundown of some of the key trade stats and their impact on the industry.

5,745

The number of products from China the Trump administration has placed tariffs on, including everything from building materials and furniture to semiconductors and cellphones. That’s amounted to $250 billion in goods since last year. In return, China has taxed $110 billion worth of U.S. imports coming into its shores.

92%

The drop in Chinese U.S. investment in 2018’s first half, according to consulting firm Rhodium Group. While that decline began with China’s capital controls, trade war tensions helped “close the spigot,” per Forbes. U.S. home purchases by foreign buyers (the majority from China), meanwhile, tumbled 36 percent between April 2018 and March 2019, a recent NAR report noted.

25%

The increased foreign steel tariffs Trump implemented last year, up from 10 percent. The hike sent prices for rolled steel — used in some of New York’s latest supertalls, including One Vanderbilt and the Spiral — soaring to a decade-high of $920 a ton last July. But last month, prices were much lower at about $557 per ton, pushed down by domestic manufacturers ramping up production and new imports from Canada and Mexico.

$100M

A high-end estimate of how much the steel tariff would push up the price to build the shell and core of a 90-story building in Hudson Yards, according to the global consultancy Turner & Townsend. The U.K.-based firm estimates that 1.2 million tons of steel went into new buildings across the five boroughs over the past year.

#2

New York City’s rank on the list of most expensive cities in the world when it comes to construction. Average construction costs here (across six building types) were $368 per square foot in 2018 versus $417 in San Francisco, which ranked No. 1. Those costs jumped 3.5 percent in NYC last year and are projected to rise another 3 percent in 2019.

148

The number of times Donald Trump has tweeted the word “tariff” or “tariffs” since launching his presidential campaign in 2015, according to the Trump Twitter Archive. By comparison, he’s tweeted “wall” 460 times.

260,000

The amount of estimated jobs the trade war has cost the U.S. economy through June 2019, according to Moody’s Analytics chief economist, Mark Zandi. That amounts to more than a month’s worth of employment growth. Among the jobs lost, about 130,000 were in manufacturing, 80,000 were in transportation and distribution, and the remaining 50,000 were across several other industries.

600

The number of U.S. companies — including such mega retailers as Costco, Walmart and Target — that wrote to Trump in June urging him to end the trade war. Many have said that  price increases will be inevitable if it doesn’t end soon. Trump, of course, is relying on a strong economy to buoy him to reelection.

An iPic theater (Credit: iPic)

Luxury movie theater chain iPic Entertainment filed for Chapter 11 bankruptcy reorganization, months after it opened its eight-screen theater in downtown Delray Beach.

The Delray project, which was in the works for six years, is a factor in iPic’s financial problems, the Palm Beach Post reported. iPic also has locations at Boca Raton’s Mizner Park, North Miami Beach and in other parts of the country. A location was planned for Fort Lauderdale.

The company filed for Chapter 11 a little over a week after it missed a $10.1 million debt payment to the Employees’ Retirement System of Alabama and the Teachers’ Retirement System of Alabama. Boca Raton-based iPic said it secured a $16 million debtor-in-financing loan from the Teachers’ Retirement System of Alabama to keep the company operating.

iPic is in talks with investors, movie theater chains and real estate firms to buy the company, according to the Post. The bankruptcy filing shows that iPic had $291 million in debt and $157 million in assets as of May 15.

It raised $15 million from 818,429 shares priced at $18.50 when it went public last year.

The Delray Beach Community Redevelopment Agency sold the land for the downtown Delray project for $3.6 million, and gave iPic $400,000 in development incentives. iPic founder and CEO Hamid Hashemi said changes to the plans, rising construction costs, taking on additional debt and interest contributed to the company’s financial decline.

In March, Hashemi said he planned to open iPics in Fort Lauderdale, Sunrise and the Miami Design District, according to the Sun Sentinel. [Palm Beach Post] – Katherine Kallergis

Toni Morrison (Credit: Getty Images)

“I live in places that I love. And I’d hate to lose them,” Toni Morrison told a reporter for The Telegraph in 2012. At the time, she was doing press for her latest book, “Home,” and its title generated countless inquiries into what the word meant to Morrison personally. At the same time, interest about the places the Nobel laureate lived throughout her life dates back decades – helped along by the strong role that “place” plays in her novels as well as the details of her personal residential history.

Morrison died on August 5, 2019, from complications due to pneumonia at a hospital in the Bronx. She was born Chloe Ardelia Wofford on February 18, 1931, in Lorain, Ohio, a town that would figure into the setting of her breakout debut, The Bluest Eye, published in 1970. While Morrison left the Midwest for Howard University in her teen years, her sister, Lois, continued living in Lorain throughout her life. At some point, many of the homes on the street where the sisters grew up were demolished.

“Now that was an erasure of place that was very disturbing to me,” Morrison said during the same Telegraph interview. “It’s absence. Not just one house. But where all those memories were. It’s death, in a sense.”

Morrison briefly returned to her hometown after her marriage ended. From there, the newly single mother of two young sons relocated to Syracuse, New York, to attend Cornell University, later taking a job as an editor with Random House. When she was transferred to the publisher’s scholastic division, she moved her family of three to Queens. “I never lived in Manhattan,” she told The New Yorker. “I always wanted a garden.”

In the late 1970s, she acquired a property that would become part of her legacy: a converted boathouse on the banks of the Hudson River in the community of Grand View-on-Hudson, purchased for $120,000. In late December of 1993, the same year Morrison won the Nobel Prize in Literature, a cinder jumped from the fireplace and the historic house began to burn. Firefighters arrived at the scene to find flames shooting through the roof, and it was so cold water they sprayed to put it out miraculously managed to preserve several manuscripts. Ultimately, she rebuilt, with upgrades: bookcases, a patio, a private dock, and continued to live there, twenty-five miles north of Manhattan.

There were other homes, too. One in Princeton, where she taught; an apartment building upstate, owned with her sons and intended to house artists; a building across the street that functioned as a performance center. In 2015, journalist Rachel Kaadzi Ghanah visited Morrison at her home in Tribeca, “one of the biggest apartments” Kaadzi Ghanah had ever seen in the city, filled with built-in bookcases, plush sofas and armchairs, a long dining room table, and antiques, overlooking Lower Manhattan.

But, as the site of pilgrimages, memories, and many pages of Morrison’s history, it was the Grand View-on-Hudson house–the one that was nearly destroyed and then resurrected, that stands out among the rest as the home Toni Morrison built.

Javier Rabinovich and Mariano Karner with the Flamingo Commons buildings

Prive Group paid about $17 million for eight buildings within an office park in Davie, as the North Miami Beach-based real estate firm expands its commercial portfolio in South Florida.

Prive’s affiliate Prive Flamingo LLC bought the buildings totaling nearly 82,000 square feet within Flamingo Commons at 12401-12585 Orange Avenue, according to a Prive spokesperson and Cushman & Wakefield.

The seller is Flamingo Commons LLC, linked to Michael Orlove.

Prive, led by Argentinians Javier Rabinovich and Mariano Karner, assumed an $11.3 million commercial mortgage-backed securities loan from Starwood Mortgage Capital, the spokesperson said.

Cushman’s Greg Miller, Miguel Alcivar, Scott O’Donnell, Dominic Montazemi and Mike Ciadella, as well as Steven Beauchamp from Mangrove Advisory, represented the seller. Jason Hochman of Cushman assisted with the assumption of the loan.

Developed in 2002, the original Flamingo Commons project included 10 buildings totaling 94,457 rentable square feet, on a 14.78-acre site. Two of the buildings were sold immediately after development.

Prive’s six one-story buildings and two two-story buildings will continue to be operated by Crexent Business Centers, the spokesperson said. The property is currently 99.4 percent to more than 200 tenants, according to the offering memorandum. Tenants include Flamingo Commons Dental, Mazzola’s West Italian Restaurant, Shades of Red Salon and The Gordon Group Luxury Cruise Planners, Cushman & Wakefield said.

Prive focuses on the commercial market in South Florida. Its office projects include Forum Aventura, a recently completed 12-story office condo building at 19790 West Dixie Highway in Ojus; and Aventura Square at 18802-18820 West Dixie Highway in Ojus, an eight-story office condo project with about 100,000 square feet of office space and 9,000 square feet of ground floor retail.

Mattoni Group president Ricardo Caporal, 5125 Biscayne Boulevard before it was demolished in July 2017, rendering of redeveloped Bayside Motor Inn site designed by Urban Robot Associates, developer Avra Jain

Two-and-a-half years ago, the city of Miami’s Historic and Environmental Preservation Board approved plans to demolish a 72-year-old Biscayne Boulevard motel and replace it with a three-story office and retail building.

But a lawsuit seeks to scrap those plans and force the Mattoni Group to build an exact replica of 5125 Biscayne Boulevard, a 6,430-square-foot MiMo-era building that was demolished in July 2017.

On Monday, Morningside residents Elvis Cruz and Robert Stebbins filed a lawsuit in Miami-Dade Circuit Court against the city of Miami and 5101 RE CO LLC, a company managed by the Mattoni Group founder and president Ricardo Caporal. Cruz and Stebbins contend that the city and 5101 RE CO LLC violated the terms of a 2014 settlement agreement between the city, developers and neighbors that required both the hotel at 5125 Biscayne Boulevard and the neighboring Bayside Motor Inn be preserved by the developers.

“This case is an example of what I believe we are going to be seeing more of — neighborhoods and individual residents being forced to take legal action to get the city to enforce its laws and the contracts it enters into,” said David Winker, an attorney for Cruz and Stebbins, via email.

The deal would enable real estate developers to build a larger building after already cashing in on previous transfers of development rights, Cruz added.
“It was a clear-as-day, blatantly dishonest action,” Cruz said via email. ”I even had assistant city attorneys tell me, off the record, that this was clearly a breach of contract. It’s another money-motivated manipulation at Miami City Hall.”

“We are in the process of reviewing the matter as we have not been served yet,” said city attorney Victoria Mendez.

The Mattoni Group did not respond to a request for comment. Developer Avra Jain, who said she retains partial ownership in the project, said she hasn’t been served with a lawsuit either. Jain also denied that the covenant has been violated in any way. “There were two buildings: one was contributing and one was non-contributing,” Jain clarified, adding: “You know I follow the rules. Nobody has been more for preservation than I have. Why would I not follow the rules?”

Jain also pointed out that the Third DCA had already ruled against Cruz in 2018. Indeed, Cruz, Stebbins, and Damian Pardo retained attorney Linda Carroll in July 2017 to file a writ of certiorari to prevent 5125 Biscayne’s demolition. Elliot Scherker, 5101 RE CO LLC’s attorney, argued that the writ was moot since the building was already demolished. The Third DCA agreed and ruled in 5101 RE CO LLC’s favor in November 2017.

Winker insisted that this lawsuit is “unrelated to that writ” filed two years ago and is “an action to enforce the settlement agreement entered… between the parties.”
“The developer and city breached the terms of the settlement agreement,” Winker added in an email.

Winker contends that both the 5125 building, which was built in 1947, and the neighboring 67-year-old Bayside Motor Inn at 5101 Biscayne Boulevard were to be preserved under a restrictive covenant that was agreed to between Jain, the city, and residents of neighboring Morningside, five years ago.

But in February 2017, Jain and the Mattoni Group presented plans to the historic preservation board that only preserved the Bayside Motor Inn. As for the 5125 Biscayne building, the developers proposed knocking it down and replacing it with a new 18,994-square-foot building, designed by South Beach-based architecture firm Urban Robot Associates, with retail on the ground floor and two floors of offices on top. That concept was approved by the board by a vote of 4 to 1.

The covenant Winker referred to ended nearly a decade of litigation surrounding both properties.

Back in 2004, Chetbro Inc. proposed demolishing the two MiMo motels and replacing them with an 87-foot tall condominium. Although initially approved by the City Commission, the decision was soon met with lawsuits filed by Cruz and other Morningside residents. By 2006, the city was siding with the Morningside residents and supporting a 35-foot height limit for the recently enacted MiMo Biscayne Boulevard District. Chetbro, however, contended it filed under zoning that allowed it to build as tall as 95 feet in height.

In November 2013, Jain, known for rehabbing the Vagabond Hotel and other Biscayne Boulevard properties, paid $2.1 million for the 5101 and 5125 buildings. Two months later, Jain entered into a settlement agreement with Morningside litigants and the city. Besides requiring the preservation of both buildings, the suit claimed that the covenant granted four times the amount of transferable development rights, or TDRs, “in order to encourage the preservation of the historic property and minimize the impact of the development of the property on the MiMo District and the surrounding neighborhood.”

City records indicate that Jain sold 339,789 square feet of development rights to four different development sites in Miami between October 2014 and July 2015. Recipient sites included Park Grove in Coconut Grove (39,739 square feet), Eve at the District in Wynwood (107,000 square feet), Brickell Heights (122,306 square feet), and Brickell Ten Condos (71,014 square feet).

Then, in June 2016, Jain sold at least part of her interest to 5101 RE CO LLC for $4.1 million.

Back in February 2017, Jain contended that the 5125 building was in horrendous shape, having sustained significant fire, water, and termite damage. “I can tell you without a doubt that the building is not worth saving,” Jain told the historic preservation board.

Cruz and the Morningside Civic Association appealed the board’s decision to the Miami City Commission in May 2017. Planning Director Francisco Garcia, however, called the restrictive covenant “immaterial to that particular application” and insisted that the 5125 building was never officially declared a contributing historic building. Iris Escarra, attorney for the Mattori Group and Jain, argued that Jain did exactly what she was supposed to do in the agreement: which was to not build an 87-foot-tall building, preserve the contributing Bayside Motor Inn Motel, and submit plans to the HEPB.

During the May 2017 commission meeting, Cruz and several Morningside residents spoke out against replacing 5125 Biscayne with a new commercial building. There were also many Upper Eastside dwellers — including from Morningside — who lauded Jain’s previous projects on the boulevard and supported her plans.

The commission unanimously sided with the developers and denied the appeal.

Winker said the decision demonstrates how the city has “gone rogue” in not enforcing its own rules. “It is ridiculous that residents and lawyers are having to spend their time suing over such obvious and egregious matters,” Winker wrote.

For that reason, Winker said his clients are also suing for monetary damages to be determined by the courts as well as legal costs.
The city is also in a legal dispute with the developers. On March 13, 2019, the city placed a lien on 5125 Biscayne Boulevard for work performed without a finalized permit and placing an illegal chain link fence along Biscayne Boulevard.

Ashton Kutcher, Adam Neumann, and Martin Scorsese (Credit: Getty Images)

Add these ideas to the pile of ambitious and strange projects WeWork’s executives have pursued: an ad-campaign directed by Martin Scorsese and an NBC television show produced by actor-cum-tech bro Ashton Kutcher.

The office space startup, whose parent firm The We Company is valued at $47 billion and expected to launch an initial public offering as soon as next month, has over-and-over again attempted to reframe its image as more than just a real estate company.

At the behest of its chief executive, Adam Neumann, WeWork has invested in a wave pool company, launched an elementary school and made other investments in health food companies.

While some of those ventures rankled investors, the latest pursuits appear to be focused on marketing the company. According to Bloomberg, Neumann and other executives sought to collaborate with Scorsese to direct an ad-campaign for the company.

A separate idea was pitched to NBC, to launch a television show similar to “Shark Tank,” that televised the company’s Creator Awards, an entrepreneurship competition. Kutcher, who is a close friend of Neumann and has advocated for the startup, would produce the show.

In the meantime, the observers and investors have raised eyebrows following reports of peculiar moves by Neumann ahead of the IPO, which included selling $700M debt and equity in recent years.

During a recent meeting with Wall Street analysts, Neumann told the audience to think of WeWork like Amazon, rapidly expanding into multiple businesses even if it doesn’t turn a profit, Bloomberg reported. Uber made a similar pitch to investors as it was gearing up for an IPO. [Bloomberg] — David Jeans