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Wharton Equity Acquires 210-Unit Multifamily Property In Nashville, TN MSA

Wharton Equity Acquires 210-Unit Multifamily Property In Nashville, TN MSA

Continues Focus on the Acquisition of Value-Add Properties in Strong Secondary Markets
 

NEW YORK, NY — Wharton Equity Partners announces the acquisition of Cedar Pointe, a 210-unit multifamily property located in Antioch, TN. The property, built in 1988, was acquired from the original developer in an off-market transaction. The purchase follows almost $400 million of multifamily acquisitions and dispositions the firm has undertaken over the last few years which have generated annual weighted average returns in excess of 25%.

Antioch is an emerging sub-market in Nashville, TN catering to residents seeking workforce housing. “Cedar Pointe fits squarely with our strategy of purchasing assets in growing markets where we can use our 30-years of experience to upgrade the character of a property and provide a wonderful living experience at a great value,” says Peter C. Lewis, President and founder of Wharton Equity.

The firm, working closely with Tampa, FL-based design firm, CID Design, is planning an extensive overhaul of Cedar Pointe including: replacing the siding with HardiePlank, changing out the majority of windows; upgrading units; renovating the clubhouse, pool and leasing center and significantly augmenting landscaping. “We’re really excited about re-envisioning this asset by providing such touches as a gourmet outdoor kitchen, jet sprays in the pool, cabana area, fire pit, WiFi throughout and great areas for gathering in the clubhouse,” adds Lewis.

Antioch is located within 20 minutes of downtown Nashville and Nashville International Airport. The area is a beneficiary of the tremendous job growth the City is experiencing, particularly in the health care sector. Employers like HCA are in the immediate vicinity. Besides the robust job market, Nashville is one of the most sought-after places to live in the US with its professional sports teams, music industry, great culinary scene, and affordable lifestyle.

Wharton Equity Partners, based in New York City, is a diversified real estate investment and development firm founded in 1987. Besides its multifamily activities, the firm has owned and operated office, hotels, self-storage and retail properties. In addition, Wharton Equity, through its office in Miami, has over 2 million square feet of development projects in planning or development in south Florida, including the 18-story Eve at the District, a 500,000 SF mixed-use project located in Midtown Miami consisting of 194 rentals apartments and 61,000 square feet of retail space.

Wharton Equity Sells over $300 Million of its Multifamily Properties

Wharton Equity Partners Sells over $300 Million of its Multifamily Properties

WEP harvests gains from properties acquired post-2012 after increasing values through extensive upgrade programs
 

NEW YORK/PRNewswire/ — Wharton Equity Partners announces the completion of the sale of a 900-unit portfolio in Central Florida it acquired with partners in 2012. The sale caps off a productive 2016 for Wharton Equity in which the firm sold over $300 million of multifamily properties which it purchased over the last few years in partnership with institutional investors. “Starting in 2012, we saw an opportunity to acquire properties in strong secondary markets, and purchased approximately 6,500 units during this time which we are now in the process of selling to recognize gains. To date, these sales have resulted in weighted average IRR’s well in excess of 20%,” notes Peter C. Lewis, President of Wharton Equity Partners.

The firm, founded in 1987, and with offices in New York City and Miami, has a history of acquiring real estate slightly ahead of the curve and then selling when the markets ripen. “The driving investment philosophy of our firm for 30 years has been to capitalize on trends across all asset classes and strategies. Having been through a number of cycles, we felt strongly that multifamily assets would lead real estate out of the downturn, and decided to focus on secondary markets to reap the greatest arbitrage between cap rates and the cost of debt,” states Lewis.

The Florida portfolio is emblematic of Wharton Equity Partners’ investment style as the firm was presented with the transaction from a REIT when another buyer dropped out of contract and moved quickly to acquire the assets in conjunction with a New York City hedge fund and property management firm. After adding value through improved operations, and upgrades the partnership was able to raise income and sell the properties at a substantial gain.

“Although the environment has gotten more challenging, we believe there are still opportunities to purchase properties today and are actively looking for assets, particularly those catering to workforce housing,” adds Lewis. Along these lines, the company is about to close on a multifamily property in Nashville, TN that it is acquiring from the original developer. “This is exactly the type of property we want to be purchasing right now where we can completely transform an asset, located in a burgeoning market, which caters to middle income families. Within the next six months, we will expand our sights to include Class A properties in strong markets where we believe there will be downward pressure on pricing due to softening from over-building. This is in addition to our development activities, mostly in Florida and New York” he notes. In December 2016, the firm acquired a 2 acre property in the Bay Harbor/Bal Harbour sub-market in partnership with Northwood Ravin Investors where it plans on developing a mixed use project comprised of residential rentals, office and retail.

2 Million Square Feet in Downtown Miami

Featured in GlobeSt.com Daily News

 

Wharton Equity Partners Acquires Key Development Site

MHN Exclusive

 

By Jon Jordan

 

Miami —Wharton Equity Partners of New York City reports it has taken title to one of the largest remaining undeveloped parcels of land in the Miami CBD, a full city block comprised of approximately 2.2 acres.

The firm states that the property was acquired through a deed in lieu of foreclosure on a note that Wharton Equity purchased from IberiaBank earlier this year. The note was acquired with an institutional partner in an “all cash” transaction that closed in under 30 days from contract signing. No financial terms of the transaction were released.

The partnership has begun evaluating options for the “Burdines Site” property, including development, joint venture and/or sale. The property was approved for a 2.2-million-square-foot mixed-use project designed by Pei Partners (IM Pei) and Miami-based Oppenheim Architecture+Design. The prior approval included residential, hotel, retail and office components as part of the project, company officials state.

The property is within a few blocks of a number of high-profile projects that are under construction including Met 3, a mixed-use project consisting of a new Whole Foods Market at street level with 462 high end residential units, and Brickell CityCentre, a nearly 4-million-square foot mixed-use project located in Mary Brickell Village.

“We are a great believer in the long term prospects of South Florida, and in particular Miami, and expect to acquire other major assets in the market in the coming months,” states Peter C. Lewis, chairman of Wharton Equity Partners.

David E. Eisenberg, CEO of Wharton Equity Partners adds, “We viewed the note purchase as a unique opportunity to control one of the most significant undeveloped properties in downtown Miami at a time when demand for land is rising and remaining land is scarce.”

 

Wharton Equity Launches E-Commerce Industrial Platform

Wharton Equity Launches E-Commerce Industrial Platform

Developing 1 Million SF Warehouse/Distribution Facility in Atlanta
 

NEW YORK/PRNewswire/ — Wharton Equity Partners announced today the launch of its e-commerce industrial platform with the acquisition of an approximately 80-acre parcel of land in Atlanta. The property, which will be developed with a 1 million square foot warehouse/distribution facility, was purchased in partnership with Red Rock Developments and a large real estate private equity firm.

“We have been studying the effects that e-commerce is having on the logistics and distribution business and made a strategic decision to launch a major initiative to capitalize on what we believe will be significant opportunities in the many years ahead,” noted Peter C. Lewis, a founder and President of Wharton Equity. “It is our intent to build in excess of 10 million square feet over the next couple of years. In addition, we are keenly focused on acquiring obsolete warehouses around major cities and repositioning them into state-of-the-art properties that will attract “last-mile” users,” Lewis added.

The company will be concentrating on the primary and secondary markets in the US where it can develop buildings generally greater than 500,000 square feet, and which will appeal to users seeking Class A space. For its value-add properties, Wharton Equity will be targeting the top 25 MSA’s where the demand for real-time delivery is becoming a top priority of retailers.

Wharton Equity’s move into e-commerce warehouses is consistent with the firm’s history of identifying secular changes and moving quickly to develop significant businesses around these nascent trends. For instance, in 2012, sensing the pent-up demand for multifamily housing, Wharton Equity aggressively began acquiring value-add properties in the southeast US, and purchased $400 million of assets within 3 years.

“One of the great joys of my career has been the ability to proactively seize opportunities around big ideas before they become apparent to the investment community at large,” says Lewis. “It has been very rewarding that this pioneering approach, which is often lonely, has resulted in out-sized gains for our partners over the last 30 years.”

About Wharton Equity Partners: Wharton Equity Partners, formed in 1987 and with offices in New York City and Miami, is a diversified real estate investment firm with deep hands-on operating experience across various real estate assets and strategies. The company, which began as a large-scale developer of for-sale housing in the New York Metropolitan area, has invested in and operated residential, hotel, office, industrial, and self-storage properties totaling well in excess of $1 billion.

$20 Million, 2-Acre Site in Bay Harbor, Miami

Featured in The Real Deal: New York City Real Estate News

 

Wharton Equity Partners, Investment Partner Buy Taplin Property in Bay Harbor Islands for $20M

Plans call for a mixed-use project with Class A offices, boutique retail space and luxury rentals
 

By Ina Cordle

 
Wharton Equity Partners and Northwood Ravin just bought the late Marty Taplin’s office building and property in Bay Harbor Islands for $20.25 million, with plans to develop a mixed-use project, The Real Deal has learned.

The site, at 1177 Kane Concourse, encompasses 1.82 acres of mostly vacant land and a surface parking lot, with an existing, 21,078-square-foot , three­ story office building built in 1953. An additional 0.26-acre waterfront parcel at 9600 West Bay Harbor Drive also has an asphalt parking lot.

David E. Eisenberg , CEO of Wharton Equity Partners, told TRD that the joint venture’s preliminary plans are to develop a mixed-use project with Class A offices, boutique retail space and luxury apartment rentals. The exact size is not yet known, but the property is zoned B-1, allowing up to 65 feet, or about five stories of commercial and residential uses. The additional parcel is zoned Gateway, allowing for multifamily and apartments.

The seller is the 1177 Kane Concourse Partnership, owned by the Taplin family, which bought the property in 1994. It was tied up in a foreclosure for years, documents show, until the mortgage was paid off in Aug. 30, a few months after Taplin’s heirs sold the Sagamore Hotel for $63 million in April.

Eisenberg said he and his Wharton Equity partner, Peter C. Lewis, have had their eyes on the site for years. “We had met with Marty Taplin several times over the years to talk to him about either purchasing or joint venturing the development of this property,” Eisenberg told TRD.

“Its a huge, largely undeveloped parcel of commercially zoned property nestled between several very affluent communities ,” he said.

The site’s proximity to Bal Harbour Shops also adds to its appeal, said Eisenberg, who envisions a gourmet market and boutique fitness facility as part of the tenant mix. “A similar type of retail to Sunset Harbour: a community oriented destination … which is something that doesn’t exist in this market.”

Wharton Equity, a real estate investment firm with offices in Miami and New York City, has been active in the Miami market in recent years. The firm, in partnership with Mack Real Estate Group. has just completed Eve at the District, a 500,000 square-foot , mixed-use project at Northeast 36th Street and Northeast First Avenue on the edge of the Design District and Midtown. Wharton also owns a 2.3-acre development site in the heart of Miami’s Central Business District, zoned for more than 2 million square feet of mixed-use development , including more than 2,200 residential units. And the firm also owns and is renovating the Sheraton Miami Airport Hotel in partnership with Hersha Hospitality and a New York private equity fund.

Northwood Ravin, founded by David Ravin, is a development , construction and property management firm that focuses on the Southeast. It has offices in Charlotte and Morrisville, North Carolina and Tampa, according to its website .

Bay Harbor Islands, a once sleepy town, is surging with new development. At least 26 new projects are in some stage of development on the neighborhood’s two islands, many of them boutique condo buildings and townhouses , including Sophie, Sereno, Akua, Bay Harbor Gardens , Pearl House and Le Jardin.

 

Sheraton Miami Airport Hotel

Sheraton Miami Airport Hotel

 

New York — Wharton Equity Partners, in partnership with Hersha Hospitality Management and a New York City private equity firm, facilitated the acquisition of the 405-room Sheraton Miami Airport Hotel. The property is the closest hotel to the Miami International Airport and has direct access to the recently opened Miami Intermodal Center, which provides direct connections to South Beach, Brickell and other regional leisure and business destinations. The hotel has 17,000 square feet of meeting and event space, and guests also have access to a 1,800 square foot fitness facility and several food and beverage outlets. The partnership plans on carrying out a full upgrade of the guest rooms and public facilities in coordination with Starwood Hotels.

Wharton Equity’s Midtown Mixed-Use Project Grand Opening

District 36 Grand Opening in Midtown Miami

 

Miami, FL – Developers Wharton Equity Partners and Mack Real Estate Group have completed construction of the Eve at the District, named after an art piece (“Eve”) by Hawaii-based artist Anna Sweet which is featured prominently in the lobby. The project injected 195 luxury rental units and over 61,000 square feet of retail/restaurant space in an area nestled between Midtown Miami and the Design District. Located at 3635 Northeast 1st Avenue, the developers employed Stantec for architecture and design services. Susan LaFleur, director of hospitality and residential interiors of Stantec’s Miami Office reveals, “Our design team was seeking a ‘wow factor’ that would immediately engage and intrigue the guest and set the sensual tone of the space. Eve did that so wonderfully that naming the project after her was obligatory.” Two additional pieces of work by Sweet, will be displayed in the new building’s public spaces.

City Furniture Signs as Flagship Tenant for WEP’s District 36 Building

Featured in The Real Deal

 

City Furniture Signs as Flagship Tenant for District 36

Lease is for 28,000 sf of project’s total 63k sf of commercial space plus 195 apartments
 
By Ina Cordle

Rendering of District 36, Irma Figueroa and Michael Comras

City Furniture just signed a lease as the flagship retail tenant at District 36, the new mixed-use project on the edge of Midtown Miami and the Design District.

The furniture showroom represents the first tenant for the recently completed property developed by Mack Real Estate Group and Wharton Equity Partners.

Comras Company CEO Michael Comras and Comras’ Irma Figueroa, director of retail leasing and sales, represented the developers in the 28,000-square-foot lease at 3635 Northeast First Avenue, according to a release. Monette Klein-O’Grady and Daniel W. O’Grady of Prime Sites Inc. represented City Furniture in what will be its first urban expansion. Terms of the lease were not disclosed.

The store will span the entire northern block of of Northeast 36th Street, from Northeast First Avenue to Northeast First Court, Comras said. The site will represent Tamarac-based City Furniture’s 17th showroom in Florida. 

In total, District 36 has 500,000 square feet, including 63,000 square feet of retail, showroom and café space, and 195 rental apartments above, at the intersection of Midtown Miami and the Design District.

Wharton Equity, a real estate investment firm with offices in Miami and New York City, has been active in the Miami market in recent years. In December, the firm, together with Northwood Ravin, bought the late Marty Taplin’s office building and property in Bay Harbor Islands for $20.25 million, with plans to develop a mixed-use project. Wharton Equity also owns a 2.3-acre development site in the heart of Miami’s Central Business District, zoned for more than 2 million square feet of mixed-use development, including more than 2,200 residential units. It also owns and is renovating the Sheraton Miami Airport Hotel in partnership with Hersha Hospitality and a New York private equity fund.

The area on the outskirts of the Design District is increasingly attracting furniture and furnishings stores, as showrooms continue to be priced out of the district’s core. Nearby, real estate investor Sam Herzberg bought the Brown Jordan building at 3625 Northeast Second Avenue for $13 million in May 2016. And art collector Ella Fontanals-Cisneros plans to redevelop a building for design-related tenants at 301 Northwest 36th Street, which she bought in February 2015 for $8 million.

$250 Million Multifamily Transaction

Featured in Multi-Housing News Online

 

Wharton Acquires 18 Apartment Communities for $250 Million

MHN Exclusive

 

New York — Wharton Equity Partners has completed the acquisition of an 18-property multifamily portfolio encompassing 4,179 units. The New York City and Miami-based real estate investment firm paid $250 million for the portfolio. The acquisition brings Wharton Equity’s recent multifamily purchases to over $400 million, a total the firm is seeking to significantly add to in 2014 with its expansion into the New York City area and Miami markets.

Wharton completed the purchase via a joint venture with an institutional partner and BH Management, a national multifamily property owner and operator. Wharton will provide comprehensive asset management and operating partner oversight, while BH will serve as the property manager.

Most of the portfolio is situated in North and South Carolina, with the remainder located in Kentucky, Kansas, Texas and Georgia. Many of the portfolio’s properties are in highly sought after markets such as Columbia, S.C., Charlotte and Savannah.

“The properties were undercapitalized,” Peter Lewis, president and founder of Wharton Equity Partners tells MHN. “Besides deferring capital improvements, there were not sufficient funds for proper marketing and other less tangible initiatives, [such as] landscaping, lighting and signage. This erodes employee morale, as well as reduces the competitiveness of the properties. With the capital Wharton and its partners are bringing to the portfolio, we believe the properties will be quickly infused with a new sense of excitement and commitment.”

Lewis reports that several factors attracted Wharton Equity to the portfolio. Among them were locations in strong secondary markets, the potential to add value through interior and exterior improvements, and the fact that the transaction size provided economies of scale. In addition, Wharton was able to negotiate directly with the seller in an off-market transaction.

Challenges included coordinating due diligence on 18 assets, and closing within 60 days, as required under the contracts. Another hurdle was securing nearly $200 million in debt “flexible enough to allow us to execute on our business plan of repositioning and selling the assets,” Lewis says.

Wharton Equity intends to invest approximately $17 million into the properties over the coming 18 months. That capital infusion will go toward completing deferred maintenance and undertaking value-add upgrades to the properties and unit interiors.

With the firm’s history in residential development, Wharton Equity always brings a fresh perspective to its examination of properties, Lewis says. That perspective may result in the company initiating simple steps like the relocation of signage, the addition of lighting or the painting of an accent wall in a model. It may also mean evaluating staff and assisting in training.

“Given Wharton’s experience in construction, Wharton will work closely with BH Management in reviewing capital improvement programs,” Lewis says.

 

$45 Million Savannah Acquisition

$45 Million Savannah Acquisition

 

New York — Wharton Equity has acquired a brand new, 326-unit Class A property located in Pooler, Georgia, a highly-desirable sub-market of Savannah, which was in the final stages of lease-up. When the company went into contract, the asset was under 60% occupied and was 80% leased upon closing, evidencing Two Addison Place’s strong demand. “Continuing our strategy of purchasing great multifamily properties in growing markets, Two Addison Place is a prized acquisition that we will be proud of owning for years to come,” states Peter C. Lewis, President of Wharton Equity.

Inspired by the architecture of Addison Mizner, architect of The Cloister Hotel in Sea Island, GA and many of Florida’s most luxurious landmarks, the property has red tile barrel roofs, wrought iron balcony railings and stucco siding. Although in first-class condition, Wharton Equity will be enhancing the asset from adding a fire pit and a second gracious fountain, to supplementing landscaping, signage and lighting.

Wharton Equity Chairman & President Featured

Featured in Real Estate Weekly

 

Sharp learning curve puts money maker Lewis on the fast track to next big thing

 

By Konrad Putzier

 

Many developers spend their entire career specializing on one region or asset type. Peter C. Lewis has found success by doing the exact opposite.

Over his almost 30 years in real estate, the chairman, president and founder of Wharton Equity Partners has switched from developing master-planned communities in Greater New York to acquiring self-storage units, to purchasing multifamily buildings in the South and Midwest, and then back to buying multifamily buildings in Greater New York.

“I’ve always looked at the world and said ‘What’s going on and how can we take advantage of it’,” he said. “We want to be adjusting to the times and not be beholden to any particular strategy or asset class.”

This flexibility has not only led him into unchartered real-estate territory, but also made him an investor in emerging growth companies such as tech startup dataminr – a company that mines Twitter for breaking news.

Right now, Lewis believes the times are favoring multifamily buildings in cities such as New York or Miami.

Wharton Equity bought a two million square foot development site in Miami last year, and hopes to invest an another $250 million in New York and Miami in 2014 – half of Wharton’s planned total investment volume for 2014.

Lewis, a native of Great Neck, Long Island, did not start out in real estate.

After graduating from Wharton with a BS, he began a career in banking in the early 1980s. Lewis worked as a credit analyst at Manufacturers Hanover Trust, got an MBA at Columbia and had a year-long stint at Arthur Andersen (“not my cup of tea”), before earning his spores in investment banking at E.F. Hutton on Wall Street.

As an analyst, he worked in the division that financed real-estate projects for three years. “I was getting antsy,” he recalled. “I didn’t like the bureaucracy and I wanted to be the guy who buys the building, not just the provider of capital.”

In 1986, Lewis left E.F. Hutton and decided to set out on his own. Together with David E. Eisenberg, Wharton’s current CEO, the ambitious twenty-something bought a development site for a shopping center on Long Island.

“I really didn’t know what I was doing,” he recalled. “It’s a whole different story when you are the recipient of capital, instead of just providing the money. But nothing speeds up the learning process more than knowing your financial survival depends on it.”

In the end, Lewis and Eisenberg flipped the site for almost a $1 million profit, and used the money for a deposit on a 317-unit residential development site in Montville, NJ. With the help of Howard Blitman and his construction company, who gave the two no-names much-needed credibility among investors, Lewis and Eisenberg built the 317-unit townhouse and condo complex, Montville Chase. The project gave Wharton Equity its first credentials as a developer.

Over the following years, the company developed several residential projects in Greater New York. But in the mid-90s, Lewis noticed that land in and around New York was becoming scarcer and more expensive.

“We concluded the housing business wouldn’t be for us unless we moved to places like Florida or California,” he said. “So we moved into income-producing properties, setting our sights initially on self-storage buildings.”

“It was a fantastic business — no one ever called and complained that the water wasn’t running properly.”

Wharton Equity started off by buying almost 80 percent of all self-storage units in the Hamptons, rebranding them, and selling them for a profit. Then, the firm repeated the exercise, buying 6,500 storage units in Long Island City, the Bronx and Yonkers from GE Capital.

Lewis painted the buildings purple to make them stand out, unified them under one brand name, and sold them to Northwestern Mutual Life for a substantial profit.

Around 2006, Lewis formed an opportunity fund with an institutional partner in anticipation of the pending downturn.

The fund acquired a mixed-use project in Lexington, Kentucky as well as two warehouse buildings in midtown Manhattan, specializing in high-end art storage. Facing a difficult fund-raising environment, Lewis subsequently sold his interest and set his focus on multifamily acquisitions.

Wharton Equity has been making up for lost time, buying more than $400 million in multifamily projects, consisting of over 6,400 units in eight states, in less than two years.

Last month, Wharton Equity announced the acquisition of a $250 million, 18-property multifamily portfolio.

Kenneth Hoff, president of Multi Housing Equity Partners, who helped source and structure the deal on behalf of Wharton Equity, is actively involved in helping the company find additional properties to acquire in NYC and the southeast.

Despite his busy schedule, Lewis has found time to teach a younger generation the tricks of the trade.

He has taught a class in entrepreneurship at Columbia University, and said he is looking to teach at the University of Pennsylvania’s Design School this spring. Lewis, who is married with three children and lives in Old Westbury, said he is far from done.

“I’d like to see if we can do more than $500 million in acquisitions this year,” he said, adding that he plans a “major push” in New York multifamily and hospitality.

“We are moving into a stage of the real estate cycle where the theme will be urban,” Lewis said. “Real money will be made designing cool projects in cities like Miami and New York that cater to renters seeking social, lifestyle-type living in a vertical environment.”

Then he added: “I think we can go bigger. It’s not my ego, it’s more a question of: why not? Setting high goals and achieving them is the highest joy.”

Wharton Equity’s Midtown Mixed-Use Project Tops Out

Featured in The Real Deal: New York City Real Estate News

 

District 36 Tops Off in Midtown Miami

Construction began mid-year 2015

 

By Sean Stewart-Muniz

 

The topped off District 36, left, and a rendering of the finished 19-story building, right
The topped off District 36, left, and a rendering of the finished 19-story building, right

Developers Wharton Equity Partners and Mack Real Estate Group have topped off their 19-story apartment building District 36 in Midtown Miami.

Construction of the mixed-use tower first began in mid-year 2015 after Wharton and Mack closed on $68 million in construction financing with JPMorgan Chase Bank.

The development partners are building 195 rental units and 63,000 square feet of retail space split between the first and second floors. Comras Company, headed by Michael Comras, is handling leasing for the building’s commercial spaces.

Located at 3635 Northeast 1st Avenue, District 36 is expected to open by the end of 2016. The development partnership first paid $9 million for the acre-sized site in 2014, according to Miami-Dade County property records.

ADD Inc., now with Stantec, is designing the project. The architecture firm’s principal Jonathan Cardello told The Real Deal in May 2015 that the project’s purpose was to act as a bridge between Miami’s Midtown and Design District neighborhoods.

Wharton Equity Breaks Ground on Miami Design District Building

Featured in The Real Deal: New York City Real Estate News

 

Sub-Zero Wolf inks lease for flagship showroom in Miami Design District

Wharton Equity Partners is developing the two-story building at the entrance to the Design District

 

By Ina Cordle

 

Sub-Zero Wolf, the high-end appliance maker, has signed a lease for its first Florida flagship showroom in Miami’s Design District, The Real Deal has learned.

Lyle Chariff, president of Chariff Realty Group, told TRD Sub-Zero Wolf is taking the entire 9,000-square-foot second floor of the upcoming building at 3711 Northeast Second Street being developed by the real estate investment firm Wharton Equity Partners.

The sale to Wharton Equity Partners included the conceptual designs by Touzet Studio and entitlements, Chariff said at the time. One of the conditions that the purchaser made was that Chariff Realty Group stay on to be the exclusive leasing agent.

When completed, the new two-story building, called 3711, will have a 10,000-square-foot first floor with 32-foot tall ceilings that will make the second floor appear “to float” over the highway, Chariff said.

“We believe this is going to be the most visible showroom in the Design District, considering its position on the highway, I-195, which has over 100,000 eyeballs a day going in and out of Miami Beach,” David E. Eisenberg, CEO of Wharton Equity Partners, told TRD.

The property will also have an 8,000-square-foot rooftop event space with a retractable cover for entertaining. “Sub-Zero fell in love with this space because of the rooftop deck being a 360-degree view of Miami,” Chariff said.

Sub-Zero will be able to use the rooftop for events and for demonstrating summer kitchen appliances, Eisenberg said. “We, as the owner of the building, expect to generate additional income renting out the rooftop for select special events,” he added.

New York-based Wharton, founded by Eisenberg and Peter C. Lewis in 1987, has been active in the Miami market in recent years. Wharton just topped off District 36, a 500,000 square-foot, mixed-use project at Northeast 36th Street and Northeast First Avenue on the edge of the Design District and Midtown. Wharton also owns a 2.3-acre development site in the heart of Miami’s Central Business District, zoned for more than 3 million square feet of mixed-use development, including more than 2,200 residential units.

The building is scheduled for completion by the end of this year, and Sub-Zero will move in during the spring of 2017, Eisenberg said. Currently, Madison, Wisconsin-based Sub-Zero has just one showroom in the Southeastern U.S., in Atlanta, according to its website.

The new showroom is part of the push for furniture showrooms and home furnishings stores to move to the edge of the Design District, as luxury boutiques take over the heart of the area. Outdoor furniture company Brown Jordan recently opened its store in a new property developed by Chariff Realty Group at Northwest 36th Street and Northeast Second Avenue, near Midtown Miami.

Chariff said rates for ground floor space can range from $100 to $150 per square foot in that part of the Design District. He declined to disclose Sub- Zero’s rate, but said it is at a premium to other second floor space in the Design District due to its visibility and prominence on the highway.

“We have had a lot of serious interest and offers from tenants who want the first floor and we have been very selective to create the ideal co-tenancy,” Eisenberg said. “Because we have Sub-Zero taking the entire 9,000 square-foot space the tenants are willing to pay extra to be on the first floor.” He expects the first floor to have complimentary businesses such as design and home furnishings firms.

“We’re very strong believers in Miami and we believe the long term prospect of Miami is extremely strong,” Eisenberg, who leads the firm’s Miami office, told TRD. “We are making a long-term investment in Miami.”