They had it plotted since the 5th grade of prep school: the 10-year-olds, all steeped in family real estate, would go into business together.
About two and a half decades later, Aria Development Group has just closed its third deal in South Florida, one of three regions where the budding company is expanding the family holdings with about $100 million deployed. (The other two are New York City and Washington, D.C.)
For David Arditi, Joshua Benaim and Tim Gordon, who met at the Dalton school on the Upper East Side, attended business school and worked in finance, the collapse of Lehman Brothers in September 2008 was the green light to make good on their decades-old plans.
“That was the moment we felt we had the guts to go out and do something because the opportunities were there,” Benaim told The Real Deal from the offices of Cardinal Development, Arditi’s parents’ real estate company.
Maurice Arditi, 88, a former Turkish army soldier who survived the Holocaust in a French farmhouse, and his wife, Irene Arditi, who studied economics in Paris, have been investing in the Miami-area market for more than 30 years, so their son, David, spent time growing up in Miami, with Gordon and Benaim coming down for holiday visits.
Benaim was on his honeymoon in Bali when Arditi called from Miami to close the trio’s first deal – purchasing an oceanfront site in South Beach that a bank had seized in foreclosure from the defaulted borrower, who was tracked down in Hungary to sign the contract for the sale.
The “honeymoon call,” as it is now remembered, was the trigger for 321 Ocean, the luxe condo complex designed by Mexican starchitect Enrique Norten.
Sales have been swift for pre-construction, Arditi said, though completion is years off. In the meantime, Aria is heavily vested elsewhere in Miami Beach, with two retail projects slated for newly purchased properties in South Beach’s shopping district on Collins Ave.
“The vast majority of our deals are complex and hairy and involve both deal-level complications as well as financial structure complexity. That’s something we all like to roll up our sleeves and do,” said Benaim, who along with Gordon graduated from Harvard Business School. Arditi received an MBA from Emory after studying in France. The three acknowledge a desire to impose an urbane, artistic view, influenced by Europe and New York, on their projects in Miami Beach. The company was named by Benaim in homage to his side career as an opera singer.
One of the properties, at 825 Collins, is a teardown and brand new build, while the other, a historically-significant, 1929 Art Deco building at 727 Collins, will be restored and converted into a ground floor of retail and 28 upper-floors apartments, Gordon said.
Aria has less of an appetite for Miami’s up-and-coming neighborhoods or other deeply linked Miami real estate frontiers like Panama.
“We’re not betting on emerging locations,” Arditi said. “We got nervous that there were a lot of the same players who moved down [to Panama] when they couldn’t do it here anymore.”
All three developers like to think of themselves as value investors, but Gordon said the deal would have made sense for Aria even at 40 percent lower margins.
“It was oceanfront but Miami got crushed in the housing bust. People didn’t want land,” said Gordon, who added that Aria’s value investing approach means that the childhood chums expect to share many more Miami sunsets.