Raoul Thomas’ troubled CGI Merchant Group sold 65 distressed commercial units in a Coral Gables mixed-use building for $28.5 million, staving off a pending foreclosure, The Real Deal has learned.
Miami Beach-based Elysee Investments, led by CEO Haim Yehezkel, bought the units, consisting of retail and office spaces on the first three floors of Ten Aragon Condominium at 55 Miracle Mile, according to two sources familiar with the deal. Yehezkel confirmed the purchase in a brief phone call. He said the deal also included 419 parking spaces.
Morgan Stanley provided financing for Elysee, Yehezkel added, declining to provide an amount.
“It’s a first class location, and we have a large number of parking spaces, which is very important in South Florida,” Yehezkel said. “It’s the right deal for us.”
Christian Arrabal with Advisecre represented the seller, and Stefano Santoro with Disruptive Real Estate represented the buyer.
CGI Merchant used most of the sale proceeds to pay off a previously delinquent $24.2 million loan that had triggered a foreclosure complaint in February. Wilmington Trust, as trustee for a commercial mortgage backed securities trust, sued the CGI Merchant entity that owned the commercial units for allegedly defaulting on the mortgage. Wilmington Trust and CGI Merchant recently filed a joint motion to dismiss the lawsuit, court records show.
A source who worked with CGI Merchant on the Ten Aragon commercial spaces said Thomas’ firm received higher offers. “But it was very important for CGI to get a group that had a sponsor with the ability to execute,” said the source, who asked to remain anonymous. “The pricing reflects what a dynamic asset with retail and office in Coral Gables goes for based on recent trades in the vicinity.”
The sale provides Thomas with some relief after CGI Merchant lost a handful of commercial properties in recent months. In August, a Gabriel-branded hotel in downtown Miami and a Waldorf Astoria hotel in Washington, D.C., owned by CGI Merchant, were sold at separate Uniform Commercial Code foreclosure auctions on the same day.
In January, CGI Merchant lost its five-story office headquarters in Miami’s Coconut Grove in another UCC foreclosure auction. Coconut Grove-based Torose Equities, led by Scott Sherman, won the bid by assuming a $32.5 million mortgage from New York-based Madison Realty Capital.
Last year, Madison Realty filed a UCC foreclosure action, alleging a CGI Merchant entity defaulted on a $4.7 million mezzanine loan that was part of a $35.5 million financing provided in 2021.