Real Estate Review: Urban Forum
Mixed-use project set for Little Havana
Attorney Oscar Rivera persuaded six property owners to simultaneously close on his client’s purchase of 13 parcels, making the planned mixed-use Altos Plaza possible in Miami’s Little Havana neighborhood.
Rivera, a partner at Siegfried Rivera Lerner De La Torre & Sobel, worked on behalf of Tampa-based retail developer Brandon Partners and Miami-based B Developments.
Rivera also is managing the legal work for B Developments’ plan to develop three nearby sites slated for hundreds of new residential units, retail space and offices. The other projects are Altos Miami, Altos Pointe and Altos Center. All four are on 22nd Avenue west of downtown.
The site of the two-tower, 24-story Altos Plaza on three blocks between Southwest First and Third streets cost $13 million two years ago, and the project received its permit from the city last year.
B Developments’ Miguel Angel Barbagallo plans 335 condos at Altos Plaza plus 40,000 square feet on the ground floor for the first Publix Sabor, a Hispanic-oriented experiment by Florida’s biggest supermarket chain, and other retailers. The plaza also would have 40,000 square feet of office spacefor lease.
The developer has razed structures and expects to begin construction next April, said Gonzalo Negrete, B Developments’ design development manager.
Sales have not begun at Altos Plaza, but the lender is providing the construction loan because of the quality of the project, Publix’s commitment and other retail leases, Negrete said. He would not identify the lender, but said it was a national bank.
The Altos Plaza assemblage was complicated by the bankruptcy of Only Liquors Inc. The case was before U.S. Bankruptcy Judge Robert A. Mark.
The liquor store held a lease on one of the parcels and threatened to upset the lending agreement, Rivera said. The lender mandated the six simultaneous closings and would not lend the construction money if the agreement was compromised.
The leaseholder wanted to stay, and the attorney successfully petitioned Judge Mark to force the closing.
“There was a lot of tension. Each of the sellers had their own lawyers. The lender had a lawyer. Brandon Partners out of Tampa, which tied up parcels and negotiated the contracts, had their own lawyers,” Rivera recalled.
He also said the developers of Altos Plaza were concerned about the impact that a homeowners association could have on the commercial use, so he created separate land and air rights and made B Developments responsible for the ground floor retail, the shell and roof. Publix would not have signed its lease otherwise because its future would have been in the hands of the homeowners association, Rivera said.
He used truck deliveries to the Publix as an example of a potential area of conflict with homeowners, and “residents are going to want things quiet.”
“When you have a shopping component on the ground, you don’t want the residential component telling the commercial what they can do,” he said. “The commercial piece loses value if the residential above it dictates what can happen.”
Barbagallo’s company also has the 17-story, mixed-use Altos Miami under construction at the northwest corner of Flagler and Northwest 22nd Avenue. The project as planned has 122 residential units including 100 under contract, 15,000 square feet of office and about 9,500 square feet of ground floor retail. Altos Miami should be delivered by February, Negrete said.
Buyers in Altos Miami signed contracts three years ago at $215 a square foot. The remaining 22 units will be marketed at $300 to $350 a square foot, Negrete said.
Barbagallo is still working to get major permits for two additional mixed-use projects in the vicinity.
He has proposed Altos Pointe on nearly an acre on the east side of Southwest 22nd Avenue between Fifth and Sixth streets, and Altos Center is planned on three-quarters of an acre on the west side of Southwest 22nd Avenue at First and Second streets. Both will combine residential, retail and office space.
Barbagallo also is developing two other projects in Miami.
The 324-unit, two-tower Terrazas River Park Village is under construction on the south shore of the Miami River at 1861 NW South River Drive. The towers would be 27 and 21 stories.
Units were marketed at an average of $350 a square foot, and about 80 percent are under contract. The project, which is next to the city’s Sewell Park, is slated to be completed in early 2009.
Terrazas Coconut Grove is next to the Metrorail station at 2900 SW 28th Lane. The project will have 10,000 square feet of retail space, 75,000 square feet of offices and 93 condo units being marketed at $390 a square foot. Construction is expected to begin early next year.
Barbagallo, a native of Argentina who moved to Miami 10 years ago, said he chose to focus on Little Havana because the area’s proximity to downtown made it a good location. He said he has two other sites under contract in Miami-Dade but wouldn’t identify them.
As for the cooling residential market, Barbagallo said he expects his condo units to sell by targeting the work force niche. He said he has weathered booms and busts before during his decades of developing projects in Argentina.
“Life is long,” he said. “We have a permanent job in development.”