Canadian investors buy MiMo building with plans for micro condos

Buyers paid $3.75 million for 23-unit building, which equates to $161,957 per unit

Dec.December 05, 2016 05:15 PM

5201 Biscayne Boulevard, Ness Ohayon on left, Mitash Kripalani on right

Micro condos may be headed to Biscayne Boulevard, close to the MiMo district.

Canadian investors just paid $3.725 million for a 23-unit apartment building — plus air rights — at 5201 Biscayne Boulevard, with plans to add additional stories and convert the building into micro condos, broker Ness Ohayon told The Real Deal. Ohayon, owner and CEO of Witt Realty Group, which is part of Keller Williams Elite Properties, represented the buyers, a group led by David Joseph Smith and his family, of Montreal.

The purchase equated to $161,957 per unit.

Mitash Kripalani of Douglas Elliman represented the seller. Miami-Dade records show the seller as entities tied to Wynwood Asset Management and Wynwood Fund, both led by Matthieu Merchadou-Melki. 

CoStar Group data shows the building was built in 1947 and has 17 studios and six one-bedroom units, with an overall asking rent of $3.08 per square foot and an average size of 453 square feet. The building is currently 2.6 percent vacant, the data shows.

“I saw this as a great investment potential for my buyer,” Ohayon said. “My buyer is [a group of] Canadian investors and they asked me to find them a property in an up-and-coming area and something with high potential. What I saw was an amazing opportunity.”

The building, formerly the Cadillac Hotel, includes short-term rentals and apartments, and is next to other sites that are undergoing redevelopment, he said. 

Plans are to gut renovate the building, raise it to three or four stories, and create furnished micro apartments that will be converted to condos. The building is historic, so the facade will be retained, and adding two stories will require approval from Miami’s Historic Preservation Board, Ohayon said.

“We’re strong believers in the Biscayne corridor with everything happening in MiMo and the Design District,” he said. “MiMo is very strong right now.”

Micro apartments are the latest trend in units, geared to the booming generation of millennials. Billionaire developer Jeff Greene is planning to bring 400 micro apartments of about 450 square feet, each to 550 Banyon Boulevard in West Palm Beach. The 12-story building is being designed by Arquitectonica.

And developers, including Moishe Mana and Tony Cho, are also proposing to bring micro units to Miami’s Wynwood neighborhood.

Meanwhile, MiMo’s redevelopment continues with new stores and restaurants underway. In June, MiMo developer Alex Karakhanian bought the Bank of America building at 5000 Biscayne Boulevard for $6.55 million, with eventual plans to redevelop it. Under Miami 21 zoning, more than 220 units and over 321,000 square feet of mixed-use space can be built on the land.

Among other projects, a group of developers is seeking approvals for Legion East, an 81-foot-tall apartment building planned at the former site of the American Legion Post 29 at 6445 Northeast Seventh. The project, by a partnership that includes Global City Development principal Brian Pearl, Midtown Group principal Jon Samuel, and Asia Capital Real Estate partners Leslie Menkes, Blake Olafson and Michael Van Der Poel, would entail 237 apartments, 435 parking spaces, and a new 15,000-square-foot American Legion facility.

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