The Real Deal Miami

Related to sell Icon Las Olas luxury rental tower amid multifamily frenzy

High-rise is the latest newly developed, luxury apartment project to hit the market
By Katherine Kallergis | October 18, 2018 12:30PM

Icon Las Olas and Jorge Pérez

The Related Group is looking to sell Icon Las Olas, a luxury high-rise rental tower in Fort Lauderdale, amid a developer frenzy to sell newly built multifamily projects.

Related hired Cushman & Wakefield to market the development, according to a property memorandum obtained by The Real Deal. A request for offers provides a due date of Nov. 8.

The building, a 44-story, 272-unit tower at 500 East Las Olas Boulevard, was long planned to become a condominium. It was first proposed in 1999, but faced a number of hurdles – including the collapse of the housing market.

Related and Rabina Properties broke ground on the building in 2015, and financed construction with a $105 million construction loan from SunTrust Bank.  It was completed as a rental tower in 2017.

Property records show New York developer John Catsimatidis sold the site to Rabina Properties for $2.5 million in 1998, and a company tied to Related purchased a stake in it in 2006 for $36.15 million.

The property, where units average 1,516 square feet, could eventually be converted to condos. Rents range from about $3,000 to more than $7,500, and the building is 97 percent leased and 92 percent occupied. Icon Las Olas features three restaurants totaling about 21,415 square feet: Etaru Japanese Bar + Grill, Salt Seven Modern Eatery & Lounge, and IT! Italy Café.

Robert Given, Troy Ballard, Zachary Sackley and James Quinn of Cushman are the listing brokers. The brokerage declined to comment, and Related could not immediately be reached for comment.

The high-end development would likely set a per-unit record for Broward County when it sells. In 2017, a joint venture between the Rockefeller Group and Stiles sold Amaray Las Olas in downtown Fort Lauderdale for $133.55 million, or $526,000 per unit.

At that per-door price, Icon Las Olas could sell for more than $143 million.

A handful of recently completed luxury rental towers have recently hit the market, including Broadstone Harbor Beach, a 394-unit waterfront building at 1721 17th Street in Fort Lauderdale. Alliance Residential hired Cushman in September to list the development, and Given said at the time that it could sell for between $160 million and $170 million, based on comparable sales. At that estimate, the price per unit would be $406,000 to $431,000.

Zom hired CBRE, also in September, to sell Monarc at Met in downtown Miami. The 462-unit, 32-story building at 201 Southeast Second Avenue was completed about two years ago. CBRE’s Still Hunter said last month that it could sell for “well over $200 million.”

“September is a season to get institutional fall listings out. We’ve anticipated a pretty heavy amount of offerings during September and October, and we’ll see the next round in January or February,” Given said.

Cushman also recently listed Elan Maison, a 394-unit complex at 6220 Reese Road in Davie. It’s unpriced as well, but Given cited the $306,000 per-door price of Sheridan Village, a comparable property in Pembroke Pines. At that price, Elan Maison could sell for about $121 million.

Peter Mekras, managing director of Aztec Group, said there are more buyers than there are deals. But, “of the shiny new properties, there is a limited buyer pool.”

“Natural forces,” like the rising costs of land and construction financing, are keeping the market in check by slowing the pace of development, Mekras said. Projects being completed now will take months to lease up, but rents are still rising for new buildings.

“I think everybody gets very caught in the number of units and the number of buildings,” he said. “We’re starting to catch up but don’t think we’ve overshot the market in South Florida.”

In a previous interview, Given said he believes there’s a “feverish interest in the suburban markets of Broward.”