UPDATED March 1, 11:50 a.m.: 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 site was the former Power Studios, which Wharton bought in June for $14 million from a partnership majority owned by former banker Leonard Abess that included Chariff and his Chariff Realty Group partner Mauricio Zapata and others. The group had purchased the property at 3711 Northeast Second Avenue in May 2013 for $8 million. They knocked down Power Studios building, first built in 1925, about a year-and-a-half ago.
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.
Now, the firm has brokered the deal with Sub-Zero Wolf. Keith Darby and Tim Rikkers of Rise Realty represented Sub-Zero Wolf.
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.
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 $150 to $200 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.
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.
“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.”