UPDATED May 19th 6:37 p.m.: Sam Herzberg just paid $13 million to acquire the Brown Jordan building at the entrance to Miami’s Design District, a property developed by a partnership led by Lyle Chariff and Mauricio Zapata.
The partnership, which includes Alex Karakhanian and Avra Jain, paid $275,000 for the 3,672-square-foot lot in 2013. (That breaks down to about $75 a square foot.) Altogether, they invested about $2 million into the project, which means the profit comes out to $11 million, Lyle Chariff, president of Chariff Realty Group, told The Real Deal.
Chariff and Zapata bought the irregular lot at 3625 Northeast Second Avenue with the intention of using it for parking. About four months after they acquired the land, which is across the street from the Bloom building at 3620 Northeast Second Avenue, Chariff got a call from Brown Jordan, where the luxury outdoor furniture company opened its store about six months ago.
Chariff told TRD the property was his “miracle baby.”
The parcel was laden with issues, he said: an AT&T easement ran through the property, it was unplatted, and there was a six-inch gap in the lot without explanation. On top of that, Miami 21 zoning, commercial projects require at least 5,000 square feet of land, Chariff said.
Up to 15 agencies had to approve the platting of the property.
Back in 2013, Brown Jordan was looking for a space to open a showroom in the Design District, but at a lower cost than the $200-$250 per square foot that was available. Chariff pitched them the property and they settled on a 10-year lease for $100 per square foot.
Touzet Studio and Amicon Construction handled design and construction of the 8,600-square-foot building, which includes a rooftop deck visible from I-195.
Chariff pointed out that a billboard on a neighboring property goes for about $80,000 a month. “You are basically paying for a billboard and getting a building for free,” he said.
The store marks Brown Jordan’s second freestanding location in the United States, and features a perforated, custom-made ductal façade and the incorporation of materials like repurposed Miami-Dade County pine, which Amicon sourced from an existing Design District structure, coral rock and organic concrete flooring.
The buyer, Herzberg, has been active in the Design District, and more recently in Wynwood. In late August, he paid $11.4 million for a two-story commercial building at 3800 Northeast Second Avenue in the Design District. Attorney Jonathan Beloff represented the Herzberg in the sale of the Brown Jordan building.
“We really like the Northeast Second Avenue Corridor,” Herzberg told TRD. “There aren’t many properties you can buy like this one in the Design District.”
Chariff said Herzberg was his first call and his last call. “I know exactly what fits his buying criteria,” he said. “Everything about this deal was happy.”