A group of local investors led by Lyle Chariff sold a retail development site in the emerging luxury shopping hotbed of the Miami Design District for $14 million to Wharton Equity Partners.
The deal represents a nice profit for 3711 Design District LLC, which acquired the 11,336-square-foot lot at 3711 N.E. 2nd Ave. for $8 million in 2013. The former home of Power Studios, the property is on the north side of the Interstate 195 overpass at the gateway to Dacra’s big retail project.
Chariff said the ownership group included his partner at Chariff Realty Group Mauricio Zapata and Leonard Abess, the former owner of City National Bank of Florida. They secured approval for a two-story building with 20,000 square feet of retail and a 9,000-square-foot rooftop entertainment/event deck. Chariff said they finished the wells and electrical transformers on the site so it’s ready to start construction. It would take eight to nine months to complete, he said.
“My plan and intention the whole time was to develop the property since I had inside information on leasing and acquisition in the area,” Chariff said. “Wharton first came into the picture a year ago. They were more than happy to pay more when all the entitlements were there.”
Chariff said he probably left money on the table because he believes the building would be worth $30 million when completed. But he’ll remain involved in the project. He said New York-based Wharton retained him as the broker for the building. Asking rents are $110 per square foot on the ground floor and $65 per square foot on the second floor.
Chariff said that’s well below the asking rates around $250 per square foot in the center of the Design District.
While there’s not a great deal of pedestrian traffic in the Design District now as the infrastructure is being finished, Chariff said retails have posted strong sales of luxury goods.
“We are seeing less of the non-high street retailers and more higher end corporate people looking for space, people with a long-term vision for the area,” Chariff said.