Posts Tagged : Miami

How schools, trains and concerts are building up Miami’s neighborhoods
On Thursday, May 25, 2017, parents pick up their children after school at Downtown Doral Charter Elementary. CARL JUSTE cjuste@miamiherald.com

How schools, trains and concerts are building up Miami’s neighborhoods

By Rene Rodriguez
rrodriguez@miamiherald.com
June 4th, 2017 7:00 AM

On Thursday, school’s out for summer at the Downtown Doral Charter Elementary, and its report card is packed with A’s. In only its second year of operation, the school is already topping county-wide honor rolls — and helping to fuel Doral’s thriving real estate market.

In the post-recession building boom, developers promoted sweeping waterfront views and luxury bonuses like car elevators, bowling alleys, plunge pools and private chefs to wealthy buyers. But in recent months, while sales in the luxury condo market have stalled amid a slowdown in Latin America, developers are starting to reap the benefits from master plans that incorporate long-term, community-building amenities.

The Downtown Doral Charter Elementary School is one gamble that has paid off. The Florida Department of Education ranked the school tops among Miami-Dade elementaries for total achievement in English and math in 2015-2016. In November, principal Jeanette Acevedo-Isenberg won the Council for Educational Change’s annual Leonard Miller Principal Leadership Award — the first time a charter school won the honor.

The school is also proving to be a formidable draw for homebuyers. While any child who lives in Miami can apply to attend, residents of the new Downtown Doral development are given preference. According to a report by Gridics.com, Doral had 167 sale closings in the first quarter of 2017 — the fifth-highest of any neighborhood in Miami-Dade County.

Codina Partners CEO Ana Codina Barlick, who has overseen the metamorphosis of Downtown Doral from drab offices into a thriving work/live/play community, said an elementary school offering top-notch education was always a critical part of the master plan. A high school is scheduled to break ground in 2018.

“Our business is real estate, not education,” Codina said. “We don’t make a penny off the school. We just wanted it to be great, because the better it is, the more people would want to live in this community.”

In addition to that massive, 120-acre development, which cost more than $1 billion, Codina Partners also gave Doral a new city hall and the three-acre Downtown Doral park. But the elementary school takes developer-led community facilities to a new level.

“GENTRIFICATION IS THE GENESIS OF PEOPLE TRYING TO MAKE MONEY. NO ONE THINKS DEVELOPERS ARE DOING THESE THINGS OUT OF THE GOODNESS OF THEIR HEARTS.”
Doug Jones, managing partner of JAG Insurance Group

The Downtown Doral Charter Elementary School is the first charter school built in a public-private partnership between the Miami-Dade School Board and a developer. Codina Partners donated the $3.5 million plot of land where the school sits. The school is a 501 (c)(3) nonprofit corporation with its own board. That board leased the land back from the county school board and issued $20 million in bonds to construct the building.

The nonprofit board pays the Miami-Dade School Board a fee to manage the Doral operation. But the nonprofit board hires the principal and sets the direction of the school. Reflecting Doral’s high percentage of Hispanic residents, 60 percent of all classes are taught in English; the other 40 percent are in either Spanish or Portuguese. Teachers at the school work under one-year contracts.

“It wasn’t just about providing a school,” Codina said. “That’s really easy. You can call a charter school company and they will put a school here and you don’t have to think about it. We wanted to go beyond that.”

The investment is working. An analysis of U.S. census data by Florida International University’s Metropolitan Center reveals Doral is the fastest-growing big city in Florida and the 11th fastest in the U.S., with 58,000 residents in 2016 — a 26.1 percent increase since 2016. The median price of homes currently listed in Doral is $398,000; the median rent is $2,300. The median income of Doral households was $72,933 in 2015 — almost 60 percent higher than the Miami-Dade County median of $43,129.

“One of the big things that drives property values up is having good education nearby,” Codina said. “We wanted to sell something more than walls, a roof, a floor and some nice appliances. We offer a much bigger value to people by telling them if you move here, you have a school for your kids through high school.”

Quality-of-Life Perks

Doral isn’t alone in focusing on education: The Related Urban Development Group is currently negotiating with the Miami-Dade School Board to include a secondary school at its Gallery at West Brickell affordable and workforce housing project at 201 SW 10th St. Other developers are pinpointing facilities most important to their own potential buyers, including transit stations, places of worship, cultural events and infrastructure designed to serve full-time Miami residents and improve their quality of life.

“Real estate has started to transition away from just brick-and-mortar investment and more into creating a sense of place and being part of the fabric of their community,” said Steven Hurwitz, a partner at the Florida real estate firm CREC.

“It’s not a purely altruistic move, but developers who have done it successfully are seeing it equates to a more successful investment overall,” Hurwitz said. “Miami neighborhoods are starting to develop individual identities. The projects being presented in them are often playing a role in servicing that demographic and delivering more of an experience.”

Some of those projects are relatively small in scale and cater to a niche demographic. But their impact on their respective communities can be significant.

Developer Verzasca Group will donate a Mikvah — a bath used by Jewish men and women for ritual immersion — to the Chabad Lubavitch of Sunny Isles Beach as part of their 61-residence luxury condo tower Aurora at 17550 Collins Ave. Groundbreaking is scheduled for July.
Chabad Lubavitch of Sunny Isles Beach

As part of its 17-floor, 61-unit luxury condo project Aurora, at 17550 Collins Ave., developer Verzasca Group is donating a 2,000 square-foot mikvah — a bath used by Jewish men and women for ritual immersion — to the Chabad Lubavitch of Sunny Isles Beach. The mikvah, to be delivered upon completion of the building, will have a separate entrance and will be available for use by anyone in the community, not just residents of the tower.

“As a fairly new developer in town, we started to do community outreach and meet with the neighbors to understand who lives in the area,” said Verzasca managing director Tim Lobanov. “We knew we would need to get approval from the city commissioners for this project. We met with Rabbi Yisrael Baron of the community center across the street and he told us about the need. Among the Jewish people in the area, we are already known as the building that’s going to have a mikvah in it.”

On Miami’s Upper East Side, Global City Development and the Midtown Group are teaming up on a mixed-use development named Legions West that would initially bring 237 rental apartments and a new 15,000 square-foot American Legion facility overlooking Biscayne Bay at 6445 NE Seventh Ave. in Miami.

Architectural rendering of the new $4 million Harvey W. Seeds American Legion Post 29 headquarters and campus planned by Global City Development and Midtown Group as part of its five-story, 237-unit Legions West mixed-use apartment complex at 6445 NE Seventh Ave. in Miami.
Stantec

“We’re trying to update what the American Legion has been in the past — a place for older veterans to come have a drink and talk — and attract younger veterans from Afghanistan and Iraq who have young families and want to participate in activities that are more relevant for them,” said Brian Pearl, principal and co-founder of Global City Development. “We’ve organized our whole business around socially impactful real estate development. There’s a benefit to having more integrated communities that will pay off in the long run.”

Pearl said that even though his company won’t make any money from the American Legion facility, doing something positive for the community helps people feel more comfortable with new development.

Global’s desire to incorporate a swath of Legion Memorial Park into its eventual 1.2 million square-foot complex has already met with resistance. That kind of controversy is bound to arise when locals don’t entirely agree with the developer’s vision.

“Businessmen will always be businessmen,” said Doug Jones, managing partner of JAG Insurance Group. “Gentrification is the genesis of people trying to make money. No one thinks developers are doing these things out of the goodness of their hearts. But at the end of the day, you can’t stop a lot of this from happening, so it becomes about what you can get out of it. A lot of developers end up making positive changes in communities by doing what they have to do in order to get their deals done.”

Changing the city

Other developers are taking a big-picture approach with amenities needed to help Miami fulfill its destiny as a major metropolis — with all the accompanying infrastructure that implies.

In traffic-challenged Miami-Dade, nearly a dozen mixed-use residential projects are planned along U.S. 1 and in Hialeah, close to Metrorail. The trend was spurred by Brickell City Centre, Swire Properties’ mammoth 5.4 million square-foot mixed-use complex that opened in 2016.

When Swire announced its ambitious plan in 2011, Miami was still in the grip of the Great Recession. Brickell was a ghost town of unlit condos. Metrorail and Metromover’s grungy stations reflected county funding shortages. The idea of an upscale city-within-a-city that would lure shoppers, diners, residents and office workers arriving by public transit seemed like a pipe dream.

But long before the designer shops, condos, offices and eateries opened, developer Swire Properties spent $10 million refurbishing the Eighth Street Metromover Station, with a design by Arquitectonica, that would fit functionally and aesthetically into the project’s finished structure. As part of the station’s redesign, Swire is under contract to maintain the facility until 2025, with an option to renew the agreement every 10 years after that, up to 99 years.


“All our mixed-use developments in Hong Kong and China sit on top of major transport nodes,” said Kieran Bowers, president of Swire Properties. “In Miami, there’s only the Metrorail and Metromover to choose from. But we’ll always integrate public transport into the project.”

Swire and Arquitectonica paid special heed to the station’s design and its role in the overall plan. “It would have been easy for us to have made changes but left a municipal style of architecture design. But we wanted you to feel a difference when you arrive at Brickell Centre,” Bowers said.

Florida East Coast Industries (FECI) is putting the transit concept on steroids.The $3 billion, 235-mile Brightline inter-city express train service will be the first to connect South Florida in early fall via a rail system. Passengers will be able to travel from Miami to Fort Lauderdale in less that 30 minutes at a speed of up to 79 miles per hour. The train will reach up to 125 miles per hour on the eventual extension connecting West Palm Beach to Orlando.

All aboard

The project, a privately owned venture by FECI subsidiary Brightline, is expected to alleviate South Florida traffic woes, removing an estimated three million cars from clogged highways such as I-95 and U.S. 1.

One key element: a vertical neighborhood created around the rail’s Miami hub.

In downtown, FECI is developing the 11-acre MiamiCentral on Northwest First Avenue between Northwest Third and Eighth streets. The station will connect to Metrorail, Metromover and the Tri-rail and feature three buildings offering 800 rental apartments, nearly 200,000 square feet of retail space, and 300,000 square feet of Class-A office space.

Tere Blanca, founder and CEO of Blanca Real Estate, which is handling commercial leasing, says MiamiCentral will offer grocery stores, food and beverage options at all price ranges, a fitness center, an elevated jogging track, and loads of shopping. Service between Fort Lauderdale and West Palm Beach is to begin in July, with Miami service launching this fall.

“The Brightline group is moving their offices there this summer,” Blanca said. “Several leases are already underway, and the office building is delivering at the end of June and should be leased out before the end of the year. It’s an exciting project that is driving tremendous investment around it.”


$74 million

Amount being spent on improving city infrastructure at Miami Worldcenter in downtown Miami


One of the biggest neighboring investments: The massive Miami Worldcenter, the 27-acre mixed-use project spanning 10 city blocks adjacent to the MiamiCentral station. The second-largest in development in the U.S. after Manhattan’s Hudson Yards, Miami Worldcenter spans 10 city blocks and will offer a combination of retail, residential, hotel, office and expo spaces. The first phase of the project is due in 2019.

Developers of the 27-acre Miami Worldcenter mixed-use project, shown here on March 3, 2016, will spend $74 million in new infrastructure upgrades in the neighborhood, including increased water and sewer capacity, electrical connectivity, street lights, sidewalks and landscaping.
MATIAS J. OCNER mocner@miamiherald.com

As part of the $2 billion Miami Worldcenter project, developers issued $74 million worth of private bonds to fund installation and improvement of sewage and water lines, drainage, cable and Internet fibers and new sidewalks in the formerly blighted area.

“People look at Miami Worldcenter as a project, but it’s really not: It’s a truly mixed-use city-within-a-city,” said Nitin Motwani, managing principal of Miami Worldcenter Associates, a joint venture between the Falcone Group and Centurion Partners. “We’re hoping this will have the kind of impact on downtown Miami that Rockefeller Center had on Manhattan: change the way that area operates. All the infrastructure work that the public will enjoy is not the sexy stuff that everyone likes to talk about. But it’s the stuff that makes possible all the buildings you see on Brickell.”

Building community

Other developers are investing in less tangible, but still crucial, amenities. Nir Shoshani, who runs NR Investments with his partner Ron Gottesmann, has been spearheading the cultural scene over the past three years in the self-branded Arts + Entertainment district near the Omni in downtown Miami.

The developers have drawn a young demographic to the formerly desolate neighborhood via pumped-up programming: free rooftop concerts featuring folk and acoustic acts from around the U.S.; outdoor movie screenings hosted by the Miami Film Festival, street markets and art shows.

The New York-based musical duo Sofi Tukker performed a free concert on Nov. 30, 2016 on the rooftop of Filling Station Lofts, 1657 N. Miami Ave. in downtown Miami’s Arts & Entertainment district.
Andrea Lorena

Shoshani estimates he has invested more than $1.5 million on all the area’s events thus far, and his gamble may be about to pay off. The 37-story Canvas Condo tower, at 1630 NE First Ave., is scheduled to be completed in early 2018, with its bohemian-styled units ranging in size from 620-1,110 square feet and selling for $300,000-$580,000.

“Risk is always a factor in business, especially in real estate,” Shoshani said. “Our idea was to really push forward with an urban village concept. If people had thought what we’ve been doing was a promotional stunt by a developer, it would have never gotten off the ground. This wasn’t a renaissance: It’s not like there was something going on in this neighborhood 50 years ago.”

Other developments feature amenities that dig even deeper into their communities, providing job opportunities, healthcare, museums and youth centers.

A $307 million redevelopment of Liberty Square, Miami-Dade County’s biggest and oldest housing project, broke ground in May. When completed by 2020, developer Related Urban Development will deliver 1,400 condos, townhouses and apartments — all integrated with free wifi — as well as a youth center provided by the Mourning Family Foundation, a YMCA-run family center and daycare, a museum celebrating the area’s history, a medical center and 65,000 square feet of retail anchored by a national grocery chain and supplanted by locally owned businesses.

To the north, slow but steady progress continues on SoLe Mia, a 183-acre development at 15045 Biscayne Blvd. in North Miami. The project — a joint venture between Richard LeFrak and Turnberry Associates co-chairs Jeffrey Soffer and Jackie Soffer — will occupy the largest piece of underutilized land east of Biscayne Boulevard in the county. SoLe Mia will be comprised of 4,390 residences, 1.4 million square feet of retail space, dining and entertainment and two swimmable 10-acre lagoons.

According to the developer, 29 percent of the 14,000 short- and long-term jobs created by the project have been filled by North Miami residents — nearly three times the 10 percent mandated by the county.

Old-school amenities still popular

The growth of practical, neighborhood-building amenities doesn’t mean traditional standbys such as clubhouses and swimming pools are going away. Carlos Gonzalez, division president of Lennar Homes, Florida’s largest housing developer, said variations on tried-and-true amenities are still an effective way to sell new houses.

“The No. 1 competitor for all new home developers is the resale market,” he said. “There are more resale transactions than new home transactions. So how do you set yourself apart other than having new product built to the latest codes? We do home automation and energy saving. But that isn’t enough. You have to provide things such as attractive clubhouses with a kids’ water park, or a gym for grown-ups with an adjacent playroom for your kids while you work out. In South Florida, we’re tailored toward outdoor living, so we have exterior kitchens and fire pits.”

But as Miami’s population density increases and familiar neighborhoods develop more nooks and crannies, developers will continue to gamble on long-term community-building endeavors — a sign of faith in the city’s continued growth.

“When we first started this, people thought we were crazy,” Miami Worldcenter’s Motwani said. “During the recession, they thought we were stupid. Today they say we’re lucky. We are, because a lot of what we counted on has come to fruition. But this kind of transformative project just takes a little longer. It’s a great opportunity to do something long-lasting and more meaningful than just coming in, putting up another building and leaving.”

CREC Stays Independent as Consolidation Rules in South Florida.

Carla Vianna, Daily Business Review
December 9, 2016

Carol Brooks co-founded CREC in 1989

Carol Brooks co-founded CREC in 1989

National brokerages have cast ambitious eyes upon CREC, but the homegrown commercial real estate company has rejected several offers from big-name competitors.

Numerous South Florida firms such as CREC have held onto their stand-alone structures despite a wave of consolidations sweeping through the industry.

“The independent firm — our firm — we have the opportunity to be truly entrepreneurial, to be nimble, to shift very quickly, to forecast trends and respond to the dynamics in the marketplace,” said Carol Brooks, who co-founded CREC in 1989.

The Coral Gables-based company has grown to offer a wide spectrum of services, including asset and property management, tenant representation, construction management and creative workout solutions. With additional offices in Fort Lauderdale and Orlando, CREC’s leasing and management portfolio is projected to close the year at 13.5 million square feet, up 18 percent from 2014.

Brooks attributes the growth to the company’s institutional infrastructure combined with an entrepreneurial spirit.

She said CREC is modeled after a law firm. The company brings in top performers as shareholders and gives employees investment opportunities in its real estate deals.

“Everybody’s success is intertwined,” Brooks said.

The Keyes Realty Co., like CREC, has also remained independent despite offers from national rivals.

Keyes, which is active in both commercial and residential markets, chose an alternative route to boost its market share. The company joined forces this year with Palm Beach Gardens-based Illustrated Properties, another independently run company that focuses on golf and high-end waterfront homes.

Mike Pappas, president and CEO of Keyes, said the merger allows them to leverage shared resources, specifically technology. The two companies continue to operate under their existing brand names and maintained their management teams and employees after the merger.

“We believe that we are partnering with our associates,” Pappas said. “In fact we celebrate collective independence. We’re independent, and our associates are independent. We allow them flexibility and freedom in our model that lets them do business the way they want to do it, whereas the corporate model is more structured and rule-oriented.”

A number of real estate companies, however, have opted for corporate ownership over the past two years.

Taylor & Mathis of Florida LLC sold to Cushman & Wakefield in August. Cushman also acquired Miami-based property manager Gibson Realty Group last April. The deals followed a $2 billion merger with Chicago-based DTZ, which significantly boosted Cushman’s national footprint.

The mandate after the DTZ merger was to “really grow the company and increase our market share,” said Larry Richey, a managing principal who leads the company’s Florida operations.

Cushman has since added over 300 people in Florida, two-thirds in South Florida.

The company competed against other brokerages for its South Florida acquisitions, Richey said.

Last year, Colliers International Group Inc. took over Miami-based Pointe Group Advisors LLC to strengthen the global company’s services in the region.

JLL went on to acquire Cresa South Florida, which focuses on tenant representation, for similar reasons.

Avison Young expanded its footprint two years ago when it purchased Abood Wood-Fay Real Estate Group LLC, a commercial brokerage and property management company that used to operate as Colliers International South Florida. Avison Young also purchased WG Compass Realty Cos. in West Palm Beach in 2013.

“It’s pretty phenomenal that that has not happened at CREC,” Brooks said.

When asked if CREC would always reject offers, co-founder and chairman Warren Weiser replied, “Always is a long time, but I don’t see us being anything but an independent firm.”

Does Sumitomo’s $220M Grab Point To More Big Office Buys?

Does Sumitomo’s $220M Grab Point To More Big Office Buys?

JUNE 9, 2016 | BY JENNIFER LECLAIRE

MIAMI—“The fact that the Miami Tower’s price doubled in less than decade is proof that the investor appetite for existing office space is driving property values to record levels.”

The sale price on the 631,672-square-foot office asset: $220 million.

MIAMI—The Japanese corporation Sumitomo recently paid $220 million for the iconic, light-changing Miami Tower in Downtown Miami. Call it the latest sign that the investor appetite for Miami’s commercial real estate market is still intensifying.

Domestic and international investor interest continues to drive property values to record levels. For example, the Miami Tower was last sold for $105 million five years ago. The sale price doubled in about five years.

“The fact that the Miami Tower’s price doubled in less than decade is proof that the investor appetite for existing office space is driving property values to record levels,” Ezra Katz, CEO of Aztec Group, tells GlobeSt.com. “As Miami’s booming condo market outbids office developers for available land, the amount of inventory is not keeping up with the rising demand for office space. We expect that office rents and sale prices will continue to rise as supply becomes more constrained and investor demand increases.”

The past year has seen a series of similar office deals, including the $140 million sale of 777 Brickell, the $112 million sale of 800 Brickell, and the $142 million sale of Espirito Santo Plaza, all trophy assets in Miami’s financial district.

Miami’s booming condo market has also impacted the ability of institutional investors and office developers to compete for land, since condo developers will outbid them every time. As a result, Miami’s office market is seeing steady rising rental rates and increased demand, but little new office inventory to meet the rising demand.

These market fundamentals point to the reasons why Sumitomo would pay top dollar for an office asset like Miami Tower, and all signs point to other office properties trading hands as deep-pocketed investors seek top-performing assets to add to their portfolios as market conditions continue to strengthen favoring landlords.

“Sumitomo’s pickup of Miami Tower is another example of an institutional buyer targeting a performing asset amidst high barriers to new office development across South Florida,” Warren Weiser, chairman of CREC, tells GlobeSt.com. “Building a stand-alone office tower from the ground-up in today’s market has become cost prohibitive just as demand for Miami real estatesoars. This is putting existing buildings benefitting from quality locations and strong income in-place at a premium.”

In Focus – High Stakes in South Florida
Women’s Wear Daily | In Focus
Miami is riding an unprecedented roller coaster.The city rebounded from the recession only to
be hit by economic downturns in Brazil and Russia, major sources of tourism and second-home
owners for the region. Rising sea levels threaten to engulf it within the next century — if not soon-
er — but that didn’t stop a hedge-fund manager from buying two units at Faena House in Miami
Beach for a record $60 million. The Panama Papers’ leaked shell companies and offshore bank
accounts have led to cash purchases of condominiums in gleaming new residential towers,
which seem to multiply here like cells in a Petridish. Retail is also on fire in “Mall-ami,” while
commercial property sales are breaking records.

 

“The market clearly reflects consumer demand for high-quality retail experiences,” said
Michael Comras, president of a namesake commercial real estate firm in Miami Beach. Comras’
entire block on the north side of Lincoln Road, 78,000 square feet in total that he owned with
Jonathan Fryd of Fryd Properties, sold for $370 million last year. “It was the largest retail trans-
action and the second-largest of any real estate deal in Miami-Dade County history,” he boasted.
Talk to any developer or leasing broker and it’s the same story about how the city was under-
served for too long. Drew Schaul, executive vice president of RKF, a New York-based retail real
estate firm with offices in Miami, said there were 11 square feet of retail per capita when he moved
to the city in 2005, compared with a national average of 22 square feet. When LVMH Moët Hen-
nessy Louis Vuitton yanked its store portfolio from Bal Harbour Shops about four years ago
and moved it to Aventura Mall and the Miami Design District, it set a trend for brands to consider
emerging neighborhoods and evolving centers.

 

Northern states have watched populations trickle down to Florida for a while, but the city’s
retail offerings really began booming at the turn of the Millennium, helped by the arrival of Art Basel
Miami Beach and the construction of luxury residential high rises and hotels designed by star archi-
tects. Their collective impact lured high-net-worth individuals, and brands streamed in soon after.
“Miami was just a place for fun in the sun before Art Basel gave it global substance,” said Craig
Robins, chief executive officer and president of Dacra, the Miami-based real estate development firm
with a large stake in the Miami Design District. “It’s much younger, too. There were four hospitals in
Miami Beach when I grew up and now there’s one. It’s gone from 80-year-olds to 35-year-olds.”
According to the City of Miami Beach Tourism Culture and Economic Development, the city’s
median age fell from 65 in 1980 to 40 in 2014. In 1980, 49,000 people of a total population of
96,000 were over 65. In 2014, seniors made up 15,000 of 91,000.

 

Residential rent is also high in Miami. According to Zillow, the national average rent will be
$1,407 by February 2017, while the average rent in Miami will be $1,899, a 3.3 percent forecasted
increase from February 2016. It also ranks Miami metro third in percentage of income going to-
ward rent, after Los Angeles and San Francisco. New York is fourth, according to Zillow data from
the fourth quarter of 2015.
Younger generations, struggling with high rent, are influencing the city’s transition — from
a car culture to taking public transportation, walking and biking. As population and traffic
increases, distinct neighborhoods — Coconut Grove, Wynwood, the Art Deco District — are
tightening into all-inclusive, hyperlocal hubs in which to live, work and play. Some are already
fully served, while others fill in missing components, like retail in downtown and Brickell, or
residential and hospitality in Wynwood. Big-box chains are creating controversy as they creep into
former bohemian districts to service residential growth. Michaels and Marshalls plan to open in
South Beach, and Wal-Mart’s forthcoming store in Midtown Miami borders Wynwood.
“Developers and consumers are placing their bets on the full lifestyle package. People don’t
want to spend their entire lives in the car,” said Rafael Romero, an associate vice president for
retail at CREC real estate firm in Coral Gables. “They’re also staying single longer and having
kids later, so they can live in urban areas with disposable income to blow.”

 

The hottest markets — from Brickell to Sunset Harbour — target young professionals by hitting
the fashion, fitness and food trifecta. Chef-driven restaurants, which got a late start in Miami and
now open on a weekly basis, have paved the way for gentrification and the rampant rise of street
retail as opposed to the city’s historic preference for air-conditioned and covered, open-air malls.
“More than revitalization, the next decade is about connectivity as all these areas gel and roll
into one another,” said Comras of the effort to convince residents to leave the car at home or get
rid of it altogether. “These pedestrian pockets are even happening in suburban areas like Doral.”
With strong ties to Latin America, Miami retail is adjusting to different circumstances than
the rest of the U.S. Malls report tourism and second-home owners drive 70 percent of sales in the
area and people, no matter where they’re from, splurge on vacation.
The Greater Miami Convention & Visitors Bureau reported record-breaking travel and tourism
numbers last year with a 5.4 percent increase in overnight visitors to Miami and the Beaches
during the 12 months from September 2014 to August 2015 — 15.1 million overnight visitors, up from
14.2 million for the same period the previous year. This boosted the economic impact to $25.1 billion
from $23.5 billion, a 7 percent increase.

 

Retailers aren’t as affected by online shopping either; whether because of cultural preferences or
lack of Internet access, international tourists and part-time residents prefer brick-and-mortar stores.
A typical scenario is a family of four from Quito, Ecuador, flying in to buy back-to-school wardrobes.
Having seen its middle class shrink long before the rest of America, Miami’s economy mir-
rors those of Southern Hemisphere nations more closely than it does neighboring states.
“Miami functions more like a third-world society with extreme wealth versus poverty,” said
Schaul, “so you’re seeing an abundance of new luxury and discount or fast-fashion retail.”
Here is a snapshot of some local projects and neighborhood developments. ■

 

South Florida Region Experiencing Retail Resurgence

When it was Miami Beach vs. Coconut Grove, the Miami enclave lost.

Shoppers and tourists fled the historic neighborhood for the revitalized South Beach retail strips minutes from the ocean.

Years ago, this was the norm in South Florida: When one area got hot, it kicked others off the map.

“The Grove was the hottest thing until South Beach came along,” said Michael Comras, president and CEO of the Comras Co. of Florida Inc.

Then Coral Gables grabbed the attention of shoppers, and together the cities “sucked the life out of the Grove,” the commercial real estate broker and investor said.

Back then, retailers were competing for the same slice of the pie, but that’s no longer the case.

“The pie has gotten bigger,” Comras said.

Miami’s international allure and steady job growth has fueled population growth. South Florida surpassed the 6 million mark this year, making it the eighth most populous region in the nation.

With it comes a resurgence in the region’s retail sector.

An estimated 1.4 million square feet of retail is now planned or under construction in downtown Miami, mostly in big-name projects like the nearly completed Brickell City Centre, Miami Worldcenter and Met Square. Forty percent of all countywide construction activity is taking place in the city’s urban core.

As Gunster real estate attorney Brian Belt puts it, “The retail goes where the population goes.”

Amid the influx of new housing, developers are challenged to create unique concepts that attract different segments of the population, Comras said.

Foot Traffic

Craig Robins has successfully carved a niche in Miami’s retail arena, catering to design enthusiasts and the city’s most sophisticated shoppers.

Two decades ago the Miami-based developer began sweeping up property in a desolate area northeast of Interstate 195 and Biscayne Boulevard when conventional wisdom said what happened in booming South Beach could never cross the bridge.

Robins, president and CEO of Dacra, is now developing about 70 percent of the once-sleepy neighborhood known as Miami’s Design District. Dilapidated buildings have been transformed into top-shelf storefronts carrying luxe brands ranging from Christian Louboutin to Valentino.

Dacra is working on its second phase to duplicate the open-air, two-story shopping plaza on Northwest 39th Street.

“What the retail did for us is it validated the neighborhood as a blue-chip location,” Robins said.

Last month, 85,000 Pay by Phone parking transactions were counted in the nearby Wynwood district, a neighborhood commonly likened to New York’s Brooklyn borough and referred to as Miami’s Arts District.

Warehouses hint at the neighborhood’s industrial base, but their new users paint a colorful picture of an emerging community shaped by retailers.

Foot traffic has been going up steadily, said Tony Cho, CEO and founder of Metro 1, a commercial and residential brokerage company routinely inking deals in the Wynwood area. The buzz is luring well-known brands in addition to homegrown ventures like Panther Coffee.

“Retail particularly follows residential booms,” Cho said.

More than 7,000 condominium units are under construction, according to the Miami Downtown Development Authority. Over 3,000 are coming to the Edgewater and Midtown areas, which sit next to the Design District and Wynwood.

Investor Appetite

Art galleries, entertainment venues and trendy stores are increasingly occupying Wynwood’s boxy buildings, which have traded for price tags that reach $1,000 per square foot.

New York developer Moishe Mana has big plans for the 30 acres of the neighborhood he owns: Mana and his team are ironing out details in his proposed master plan, which would bring retail, office, hotel, a museum and beauty school to the district.

“The majority of buyers who understand and get Wynwood are New Yorkers because they saw what happened in the Lower East Side” and other once-neglected areas of New York City, Cho said. “They saw [it] then. The creative class came into the neighborhood and transformed it.”

Metro 1 closed $65 million worth of sales in the neighborhood during March alone. Headline-worthy deals included a 1941-built warehouse that sold for $22 million, or 633 percent more than just 17 months before.

Earlier this year, New York-based Thor Equities, which began amassing a hefty portfolio of Design District property at record prices in 2014, sold most of it to another group for $128 million. RedSky Capital, a Brooklyn-based real estate company also active in the Miami area, picked up seven parcels with plans to redevelop.

Sources close to the deal said the area’s dollar figures hit a point where Thor opted for quick profit rather than redevelopment.

The retail craze has spilled beyond Miami’s urban core.

Miami Beach’s commercial sector continues to draw deep-pocketed investors. Two months ago, a retail property on the city’s tourist-laden Lincoln Road shopping strip sold for more than $6,500 per square foot.

Last year, the resort city became home to the second largest real estate deal in Miami-Dade County history when Spanish billionaire Amancio Ortega paid $370 million for an entire Lincoln Road block.

Miami’s Coconut Grove is finally catching up.

Federal Realty, a Rockville, Maryland-based company that focuses on buying and redeveloping underperforming property, partnered with local developers Grass River Property and the Comras Co. last year to enter the Miami market.

The trio dropped millions on two neglected shopping centers: The $87.5 million acquisition of CocoWalk, a sleepy open-air retail center in the heart of Coconut Grove, and the $110 million purchase of the Shops at Sunset Place, an underutilized mall in South Miami.

Farther Afield

Investor appetite is fueling a resurgence of neighborhoods beyond the bustling urban core.

“We see a lot of demand, a population that’s not being served,” Federal Realty CEO Don Wood told the Daily Business Review in February. “If the hunch is right, we’ll spend another $200 million or more to invest in producing and creating a product that’s right for the community that it serves.”

Comras said plans for CocoWalk would be announced within the next 60 to 90 days, then plans for Sunset Place will appear shortly after.

“Obviously, we’re very bullish on Coconut Grove,” he said. “You have an amazing residential market, a great office market, a great hotel market and now it’s a matter of bringing back the retail.”

Plans will focus on creating an outdoor environment that will give shoppers a reason to step away from the computer and off the couch.

In another blockbuster deal, West Palm Beach’s Palm Beach Outlets, which replaced a fallen mall, sold for $278 million in 2015 for the second largest real estate deal in Palm Beach County history. Retail sale were up by triple-digit percentages compared to the year before, said Belt, a Miami-based shareholder at Gunster.

“It’s doing well because it has really good employment growth and income growth,” he said.

Meanwhile, shopping malls across South Florida are looking to carve out something beyond online sales, launching ambitious expansion projects to revamp their centers.

Sunrise’s Sawgrass Mills is adding a new wing, and the master-planned Metropica community is under construction next to it. Aventura Mall landed a loan early this year to kick off its expansion. Whitman Family Development’s $400 million expansion of its Bal Harbour Shops pushed forward with the $30 million purchase of an adjacent church property in February.

Then there’s the American Dream Mall slated for northwest Miami-Dade. If plans come to fruition, the mall would be the largest in the nation.

The enclosed mall versus open-air retail trend was further validated when one of Miami’s largest developments, the $2 billion Miami Worldcenter, ditched plans for a department store-anchored mall for a more airy environment. The initial 760,000-square-foot shopping center was replaced by one- and two-story storefronts on three blocks. The project broke ground in March.

Existing outdoor retail strips are also undergoing renovations.

Miami Beach recently approved a master plan for Lincoln Road, and Coral Gables’ Miracle Mile is due for a makeover.

Flagler Street

But Belt warns, “There are obvious exceptions to the rosy picture.”

While Miami’s overall vacancy rates have dipped below 4 percent, empty storefronts lining downtown’s Flagler Street tell a different story.

“In downtown Miami, some of the smaller shops that cater to the lower or lower middle-class market and foreign buyers … are not doing well at all,” Belt said.

Mana, the New York developer who owns swaths of land in Wynwood, has pocketed a number of buildings on Flagler.

He promises to make downtown young again. The developer is working with University of Miami students to design micro-apartments catering to recent college graduates and millennials working in the area.

Existing tenants dominated by electronics, luggage, perfume and apparel shops are a byproduct of segmented ownership, said Rafael Romero, associate vice president at Continental Real Estate Cos. But now business owners and government officials are pushing for the modernization of Flagler Street, forming the Flagler Street Task Force Committee to track a $13 million renovation.

For now, the downtown market is more attainable than pricey Brickell a few blocks away, “especially for a restaurateur that may have the best idea in the world but may not have the deepest pockets,” Romero said.

“Downtown and specifically that Flagler corridor and parts of that Biscayne corridor … are where we’re likely to see the greatest growth over the next cycle.”

Invest Miami 2016 – Carol Brooks

This is an exciting time for Miami’s retail market, as national and international brands are expanding their presence, and new mixed-use developments, mega malls, and neighborhood centers will create new investment opportunities…

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Archives:
Seven Office Components Headed for Doral

Responding to market demand, several new office spaces are taking shape in Doral, while there is churn in the market farther east in Waterford, sources say…

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Archives:
Brickell Retail at Premium, with Rents Doubling in a Year

3.9.16-Miami-Today-Brickell-retail-at-premiumWith the opening this fall of Brickell City Centre’s luxury open-air mall and a flood of new residents expected, Brickell has emerged as a sought-after retail spot. …

…  “It’s true that retail follows rooftops,” said Rafael Romero, associate vice president of CREC, “but ‘rooftops’ is just another way of saying ‘people,’ and the rooftops-the people-are here.” One of Brickell’s key advantages is public transit…

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Archives:
As developers go on shopping spree, Miami retail has never been hotter

Miami Herald-Alan

There’s a gold rush on for retail in South Florida.

Developers and mall operators want to renovate and expand shopping centers across the region. New retail is popping up, too, especially open-air “high-street” shops with surprisingly gourmet dining — a breezy contrast to the enclosed suburban malls of old. The cost of all that investment runs into the billions.

The timing may seem odd, given the obstacles: Economic slowdowns in Latin America, Europe and China. A strong dollar slowing tourist spending and a shaky stock market here at home. More and more people shopping online. But experts say the Miami market’s fundamentals are strong and that there’s room to grow despite fears of oversaturation when the new projects open up.

“IT’S REALLY UNPRECEDENTED. THE SOUTH FLORIDA MARKET IS ON FIRE,” Alan Esquenazi, commercial real-estate broker

To list all of South Florida’s retail activity takes heroic resolve: A 500,000-square-foot, open-air shopping center under construction at Brickell City Centre is set to open this fall. Traditional powerhouse malls such as Aventura, where the ATMs dispense $100 bills, and Dadeland have expanded or are in the process of doing so. The ultra-luxury Design District will double in size in 2017. The Bal Harbour Shops would like to grow, too. In downtown Miami, the long-planned Miami Worldcenter project recently announced a major redesign. And city governments are spending big bucks to redo Miami-Dade’s iconic retail arteries onLincoln Road in Miami Beach, Miracle Mile in Coral Gables and Flagler Street downtown. Even industrial Doral is getting an influsion of upscale retail.

In Broward, Plantation’s Fashion Mall is set to be demolished and replaced by an open-air shopping center. Meanwhile, America’s largest outlet mall, Sawgrass Mills, is planning a new wing for full-price stores and fine dining while another developer wants to build a separate, 480,000-square-foot mall next door.

And then, of course, there’s American Dream Miami, a 200-acre complex slated for Northwest Miami-Dade. If given the green light by the county, it would be the U.S.’s largest mall.

For consumers, at least those who can afford the new shops, more and better options are a good thing in what analysts say is an underserved market. New jobs, even if mostly low-wage, will help the economy, too. But some locals worry that national chains geared toward wealthy tourists will keep squeezing out the small businesses that make South Florida unique. Either way, the growth isn’t stopping.

“It’s really unprecedented,” said Alan Esquenazi, a commercial real-estate broker at Continental Real Estate Companies. “The South Florida market is on fire. The demand from national retailers, as well as local and regional, is intense. The available space is lacking. Rents are rising quickly.”

No one is making a bigger bet on South Florida than a Maryland-based real-estate investment trust that just finished a major local shopping spree, spending $87.5 million on CocoWalk in Coconut Grove and $110 million on the Shops at Sunset Place in South Miami.

“We’ve always had a strong desire to be in South Florida,” said Chris Weilminster, executive vice president at Federal Realty Investment Trust. “This is a long-term play for us.”

Weilminster said that tourist dollars pouring into Miami, as well as strong local demographics, make retail a good buy.

Miami actually outsold higher-profile shopping destinations such as New York and Los Angeles in 2014, according to a commonly used statistic collected by the International Council of Shopping Centers.

Sales for non-anchor tenants in South Florida averaged $768 per square foot in 2014, ICSC found, well ahead of New York ($581) and Los Angeles ($566), as well as the national average ($474).

“Everything is in this market’s favor, particularly in the two areas we are investing in,” Weilminster said.

But he and Federal’s partners, local developer Michael Comras and Coconut Grove-based Grass River Properties, know they have a long road ahead, one that could cost tens of millions of dollars, and likely more, in renovations and rebranding.

During a recent visit on a rainy weekday afternoon, CocoWalk was practically deserted. Even on sunny weekends, the four-story, 198,000-square-foot mall can feel a bit like the aftermath of a zombie apocalypse, forgotten by locals and frequented instead by undiscriminating tourists and teens escaping mom and dad. The mall has had four different owners since 1998, not including the latest group. Vacancy rates hover at nearly 20 percent. Tiles are cracked, paint chipped.

“This really should be the crown jewel of Coconut Grove,” said Comras, who also recently partnered on a massive $370 million sale of an entire block on Lincoln Road. (That mega-deal, to Spanish billionaire Amancio Ortega, is another sign of how badly investors want to nab South Florida retail, brokers say.)

“When you look at the areas that surround Coconut Grove from Coral Gables to Key Biscayne to Pinecrest to South Miami, you have the best demographics year-round in South Florida,” Comras added.

The new owners say they have plans to renovate CocoWalk and Sunset Place with sleeker, more contemporary finishes. They also want to relieve the heavy, fortress-like qualities that serve to cut the malls off from bustling downtowns in Coconut Grove and South Miami. That means bringing in a stronger mix of local, regional and national tenants ( “newer, cooler, hipper,” Weilminster said) and better dining options. They’ve tried things like weekly cooking classes at other properties to get people interested in reconnecting with their local malls.

“People want to be immersed when they shop,” Weilminster said. “You have to create something experiential … That’s how you get them off the couch and off the Internet.”

Federal owns more than 90 properties with 21 million square feet of retail in 12 states, including major developments in California, Massachusetts, Pennsylvania, Virginia and Washington, D.C.

For now, the company is playings its cards close to the vest on CocoWalk and Sunset Place. But it does plan to release complete details of planned renovations at both malls within the next two years.

“The raw material is great,” said Don Wood, Federal’s CEO. “The product’s not great. But we’re going to change that. We have to listen to what the community wants and what the retailers want. It takes time.”

“You can’t do what worked in San Jose and plop it down in South Miami or Coconut Grove.” The numbers don’t lie.

As the luxury condo boom dies down, retail has become one of the strongest sectors of the local commercial real-estate market. Retail vacancies of just 3.5 percent are near record lows for Miami-Dade County and are expected to fall even lower, according to a recently released report from TD Bank. Sales are up 4.5 percent, despite a strong dollar that has slowed tourist spending from Latin America and Europe, the report found.

“South Florida’s economic growth since the recession and the number of new people moving into the state have really ramped up retail,” said Michael Dolega, a senior economist at TD Bank.

Retail space across Miami-Dade rented for an average of $33 per square foot in the fourth quarter of 2015. That’s double the national average and 17 percent above Miami’s pre-recession peak in 2007, Dolega said. The hottest sub-markets are Brickell (more than $80 per square foot) and Miami Beach (more than $70 per square foot), the bank found. Prime real estate on Lincoln Road goes for more than $300 per square foot, according to brokers who work in the area.

The fastest-growing area in Miami-Dade? The Biscayne corridor along Miami’s historic MiMo district, where retail rents have soared an average of 12 percent per year since 2011 as developers open up new restaurants, hotels and shops, including a boutique from luxurydesigner Trina Turk. More and more young people are moving into the urban core. In the last 10 years, downtown Miami’s population has more than doubled to 80,000, according to the Downtown Development Authority.

But there are dangers: Federal Reserve bankers have warned of a possible bubble forming in commercial real estate. Eric Rosengreen, president of the Boston Fed, said in a speech late last year that low interest rates could cause investors chasing higher returns to take on too much risk, according to MarketWatch.

TD Bank, for its part, acknowledges that some markets may be too frothy, particularly the office sectors in New York, Boston, Washington, D.C., and San Francisco.

But economist Dolega said Miami retail was not a high-risk market. “The risks do not appear to be concentrated in Florida,” he said, adding that local demand was high enough to absorb the new supply in the pipeline. “According to our projections, all the inventory is going to be absorbed through 2017.” Later in the decade, supply might start to outpace demand, but only slightly, he concluded.

“We would love to do more retail lending,” said Ernie Diaz, regional president for TD Bank.

Even single-tenant properties such as gas stations, banks, fast-food chains and pharmacies are hot, as long as the tenants belong to a well-run national chain, said commercial real-estate broker Alex Zylberglait. “Demand has been on the rise in the $1 million to $20 million range mainly due to interest from foreign investors,” Zylberglait said. “These assets are very hands-off and very safe, so they can put in the money and then sit back … And there’s a lot more demand than there is supply, meaning prices are rising.”

But Mitchell Kaplan, who owns local favorite Books & Books, said he worries that all of the money pouring into Miami retail will mean higher rents and the demise of many small businesses. The bookstore has locations in Coral Gables, Bal Harbour and on Lincoln Road, as well as at the Adrienne Arsht Center and Miami International Airport.

“Look at how Lincoln Road has lost its retail uniqueness,” Kaplan said. “You don’t want all of South Florida being dominated by national chain stores … locally owned, independent businesses can’t compete with the rents paid by the chains. We don’t operate on a level playing field.”

“Even the traditionally edgier places in Miami are seeing the influx of the national chains,” Kaplan continued. “Look at Wynwood, look at Coconut Grove. All neighborhoods in Miami have become places where investors now prospect. They buy up real estate. They seek national chains as tenants since their ability to pay high rents makes their properties more valuable, and then they often flip their properties, making lots of money. The question to be answered is: Does that make our community better?”

The mall that started it all

Even the shopping center that launched luxury retail in South Florida is looking to keep pace with the new activity.

Bal Harbour Shops, which celebrated its 50th anniversary last year, wants to build a new wing that would double its size to about 800,000 square feet. (First, it needs to gain voter approval for a land-swap deal and end a high-profile and increasingly ugly tussle with neighbors.) The open-air shopping center boasts tenants that are the crème de la crème of luxury retail: Gucci, Prada, Valentino, Chanel, Armani. With sales at about $3,000 per square foot in 2015, it remains the most lucrative shopping center in the U.S., according to CNBC.

But in recent years a few major tenants have left leafy Bal Harbour for bigger stores in newer locations. Louis Vuitton, Hermès and Cartier have all opened in the Design District, developer Craig Robins’ new Midtown mecca for ultra-luxury retail, which is itselfexpanding.

Vuitton also opened at Aventura Mall, owned by Turnberry Associates and Jackie Soffer, who is married to Robins. “Vuitton had a 5,000-square-foot store here at Bal Harbour,” said Matthew Whitman Lazenby, whose family developed and owns the shops. “They opened at 18,000 square feet in Aventura.”

Lazenby said the Bal Harbour expansion, which he called “hugely important,” would allow for stores to move into bigger spaces and would also create more restaurants and cafés. “That’s how we can differentiate ourselves,” Lazenby said. “With the experience we provide.” He added that if the shops had been allowed to grow five years ago, when his family first proposed the expansion, it likely would have been able to hold onto now-departed tenants.

Current tenants agreed.

Books & Books opened in Bal Harbour 10 years ago, and owner Kaplan said he supports the expansion at the shopping center, which he praised for renting to a local business. “The more stores and eating venues that surround us in the Shops, the better we do. More stores bring us more business.”

As for the Latin American currency crisis that has taken a bite out of tourist spending in Miami, Lazenby described it as a “temporary blip.” Bal Harbour’s business is roughly 80 percent tourist, 20 percent local.

As a result, he said sales have dropped about 10 percent in 2015. Other retailers that depend on foreign money have also reported sales dropping or flattening out.

“We’ve seen these cycles before, and we know they come to an end,” he said.

While the Miami market is down overall, Design District developer Robins said his brand-new project, where a flagship Hermès store just opened, is bucking the trend.

“Eleven out of 13 of our stores that were open in 2014 actually grew in 2015, and several averaged gains of 25 to 30 percent,” Robins said. “And we’re only 30 percent open.”

About 50 stores are open in the still-under-construction district, with that total expected to grow to more than 120 plus a hotel and 10 new restaurants by the end of 2017.

High-street style

One of the most obvious trends in Miami’s retail boom is a preference for open-air, high-street spaces on the model of Fifth Avenue in Manhattan and Rodeo Drive in Beverly Hills. Traditional malls around the county have struggled as consumers turn to online shopping. Developers in South Florida want to piggy-back on the region’s good weather, despite the advantages of an enclosed space.

“There are some very obvious benefits to being enclosed, air-conditioned and fully controlled,” said Steve Patterson of the Related Group, which is developing a mixed-use project called CityPlace Doral with 250,000 square feet of open-air retail. “You have a shopping experience not impeded as much by weather. For the most part, it’s predictable. That’s great for retail. The downside to it is it’s expensive. The rents for the tenants are much higher than they would be for open-air.”

The most recent example of the shift toward high-street is Miami Worldcenter, a long-planned, $1.7 billion, mixed-use development in downtown Miami that was derailed by the financial crisis in 2008. The latest twist-and-turn for the back-on-track project came last month when the developers announced they were replacing a planned enclosed mall with asmaller, open-air shopping center. That means Macy’s and Bloomingdale’s, Worldcenter’s original anchors, may drop out. They need bigger stores than the high-street retail model can provide. (Not to mention the fact that Macy’s, which owns Bloomingdale’s, has faced seriously slumping sales. Last month, the retailer announced it would lay off more than 4,000 workers and close 36 stores across both brands.)

“Our original plan was actually for high-street retail,” said Nitin Motwani, a principal with the Worldcenter development team. “But the retailers at the time didn’t quite understand what was happening in our dynamic market. They wanted a mall.”

But Motwani said that as once-deserted downtown Miami filled up with new condo towers, restaurants and museums, the needs of locals changed. They were ready to walk. “Because we had not yet started construction, we were able to realize that and design something that is more long-lasting and pays attention to the new norm for retail,” he said.

The new plan calls for one- and two-story shops laid out over several blocks in downtown Miami where the mall would have gone. Outdoor cafes and pedestrian-friendly sidewalks, as well as a feature to provide shade, are all part of the plan, which hasn’t been released yet, Motwani said.

The projected opening date remains fall of 2018.

Meanwhile, in Plantation, Worldcenter partner Art Falcone is leading a redevelopment of the bankrupt Fashion Mall, built in the 1980s. Falcone plans to tear down the mall and instead build a 250,000-square-foot open-air shopping center with 700 rental units on 35 acres. “We’re targeting boutique tenants and smaller stores [for the retail],” Falcone said. “This is going to be a more Miami-type product than what you typically see in West Broward.”

Another open-air project gaining steam is Brickell City Centre, the massive mixed-use development set to open its retail component in the heart of Brickell this fall. Developer Swire Properties is partnering with Lazenby, of Bal Harbour, and retail giant Simon Property Group.

Brickell City Centre features an open-air, 500,000-square-foot shopping center cooled by an innovative climate ribbon. Swire, a Hong Kong-based developer with a long history in downtown Miami, said it learned how to make open-air projects in hot climates work from its experiences in sweltering East Asia. “You can look around and see how successful the outdoor experience is in South Florida,” said Debora Overholt, Swire’s vice president for retail. “The weather in Miami is one of the major attractions. People come here to enjoy that instead of being in an enclosed shopping mall.”

So far, Brickell City Centre has attracted high-profile tenants including Saks Fifth Avenue, which also anchors Bal Harbour; the luxury dine-in movie theater Cinemex; and, according to one source, Florida’s largest Apple store. “We really wanted to be in a premium market,” said Jaime Rionda, chief operating officer of Mexico City-based Cinemex. “The area of Brickell and the amount and quality of tourists that arrive every year and stay for days and even weeks is incredible.”

The company plans to open a 10-screen, 620-seat theater serving “sophisticated finger food” such as paninis, burgers and ceviche, Rionda said. Brickell will be its first U.S. location.

A future for old-school malls

While some traditional malls around the U.S. may be in trouble, Miami-Dade’s powerhouses are doing well.

Dadeland Mall in Kendall just completed a major redevelopment, adding a new 102,000-square-foot shopping wing and renovating and modernizing its food court. Dolphin Mall in Sweetwater also opened an expansion last year with five new restaurants and a 1,300-space parking garage.

And massive Aventura Mall, already Florida’s largest, is embarking on a redesign of its own with a three-story, 315,000-square-foot expansion expected to open in 2017. (That plan is being challenged in court by Sears, which wants to develop its own open-air shopping village.)

In addition to Vuitton, new high-end stores have opened at the 2.7-million-square-foot mall, including Pucci, Tiffany and Longines. Jackie Soffer, who co-owns Aventura Mall, said its dining options haven’t kept up with the tenant mix. New restaurants will be a major part of the expansion, as well as a VIP lounge, she said.

“We know where we have voids in our property, and one of the voids is food,” Soffer said. “We’ve now upgraded the selection from a shopping perspective. But with all the luxury sales we have in the mall, and the customers we have in the mall, we’re not catering to them as far as restaurants are concerned.”

The changes at the mall mirror the way developers have remodeled Miami as a destination for the global elite.

“Ten years ago, a person from New York used to eating at New York-quality restaurants would not have a huge selection [in Miami],” Soffer said. “Now they can come here and eat at a different restaurant every night for a month and not feel like they were sacrificing.”