The Real Deal Miami

Alex Birkenstock and partner cut price to $11M for Miami Design District building

Redevelopment plans are for a mixed-use retail/restaurant with 9,326 sf and a rooftop patio

Rendering for 4030 North Miami Avenue, existing building, with Jonathan De La Rosa on left, Scott Sandelin on right

A vacant building on the edge of Miami’s Design District, owned by Alex Birkenstock and a partner, was just re-listed for $11 million — 15 percent below its $12.9 million asking price last year — amid the area’s transformation into a luxury shopping destination.

The property, at 4030 North Miami Avenue, has 7,642 square feet of leasable space, on an 11,750-square-foot parcel of land. The price equates to $1,439 per square foot for the building and $936 per square foot for the land. 

Marcus & Millichap’s Scott Sandelin, first vice president of investments in Marcus & Millichap’s Miami office; and Jonathan De La Rosa, senior associate, represent the seller, Miami La La La LLC and Miami Barokh LLC.

Records show Birkenstock of New York is the manager of Miami La La La LLC. Khashy Eynalhori is the manager of Miami Barokh LLC. Ben Bennett and Jerry Pumo of B.B.J. Rentals had sold the building to Birkenstock and Eynalhori for $2.5 million in 2012, according to the deed. The building was built in 1948.

Birkenstock, heir to the eponymous sandal company fortune, and his partner had originally listed the property in May of last year for $12.9 million, as part of a Design District assemblage of a more than an acre that was priced at $37.5 million, listed at the time with Metro 1. Records show none of the six parcels have since sold.

The property is zoned T5-O, which means it can accommodate an art gallery/studio, restaurant, hotel, retail store or lounge, Sandelin said. The offering includes plans by Kobi Karp Architecture for a mixed-use retail/restaurant concept for the building that would increase the leasable square footage to 9,326 square feet. Sandelin said he has renderings and a site plan showing different options that would allow one or two retail spaces downstairs and a bar/lounge upstairs with an outdoor patio facing east. “That is the vision,” he said.

Asking prices and rents are far lower on North Miami Avenue than in heart of the Design District, De La Rosa added. On North Miami Avenue, rents are at about $85 per square foot, triple net, compared to as much as $300 per square foot in the central part of the Design District, he said.

The Design District is in the midst of a transformation into a luxury shopping, dining and cultural destination, spearheaded by Craig Robins, president and CEO of Dacra. Dozens of stores are currently open, and a total of about 120 are expected to open on Dacra property by the end of 2018, with another 40 on other property owners’ land, plus about 15 restaurants, Robins has said.

Major investors have swooped in to buy properties in recent years. In March of last year, Norfolk, Virginia-based Harbor Group International bought a retail building at 111 Northeast 40th Street for $21.5 million or $2,445 per square foot.

Brooklyn-based Redsky Capital and London-based JZ Capital Partners have added to their portfolio in the area, paying $128.3 million for eight sites encompassing nearly two blocks, in February 2016. In all, the joint venture partners have invested more than $233 million in the district.

Last month, developer Remy Jacobson’s plans to convert 4141 North Miami Avenue into retail use won approval from the Miami Historic and Environmental Preservation Board. Jacobson’s company bought the property for $10.5 million or $600 per square foot, in April 2016.

And in January, a group of homeowners on the edge of the district banded together to market their sites as an assemblage, asking $18 million. At that price, the combined 30,000-square-foot property along Northwest 38th Street would sell for $600 per square foot. The parcels have frontage along the northern end of the 112 expressway and border on the east by North Miami Avenue.