PPG Development and its partners scored $235 million to build a 728-unit multifamily project in North Miami Beach.
The financing package consists of a loan and a preferred equity investment. The deal comes as construction lending continues to flow in South Florida, despite elevated interest rates, skyrocketing insurance, tariffs and other headwinds.
PPG, led by Ari Pearl, as well as Isaac Khabie of Ark Ventures and Matt Press of EquiShares, plan to start development of the Palm Aire complex with five buildings on the former Nova Southeastern University campus by month end, according to Pearl and a PPG news release. The 8-acre site is at 1750 and 1775 Northeast 167th Street.
BDT & MSD Partners provided a $205 million construction loan, the release says. Skylight Real Estate Partners and Meadow Partners, both based in New York, provided a $30 million preferred equity investment.
Aaron Kurlansky of Sheridan Capital represented the borrowers and BDT & MSD. Aaron Jungreis and Alex Fuchs of Rosewood Realty Group represented the borrowers, Skylight and Meadow.
Palm Aire will consist of two three-story buildings, two six-story buildings, an eight-story building and a pair of garages, according to Miriam Ungar of PPG. All units will be at market-rate rents.
The project’s completion will be staggered to allow for newly finished apartments to lease-up before delivering additional units, she said. Palm Aire will include a bodega in one of the buildings.
Hallandale Beach-based PPG, Khabie and Press bought the development site from Dezer Development for $31.1 million in 2022. Khabie’s Ark Ventures and Press’ EquiShares are both based in Miami. Dezer bought the property for $20 million from Nova Southeastern in 2018.
Nova Southeastern still occupied a portion of the site when PPG and its partners bought it. The school’s lease ran out in the summer of 2023.
In 2023, the developers scored approval from the city for Palm Aire, according to North Miami Beach records.
A few projects are in the pipeline in North Miami Beach. Trinsic Residential Group and Macken Companies are developing the eight-story, 373-unit Aura with 17,000 square feet of ground-floor commercial space and 9,000 square feet of exterior retail space at 16955-17071 West Dixie Highway.
Across South Florida, developers and landlords largely have turned to private lenders over the past three years. Banks, which have been heavily regulated since the Great Recession, can’t waver from minimum capital requirements and overextend. Amid higher interest rates, banks have had to extend maturities for some borrowers struggling to meet debt obligations, or provide other forbearance. This limits their ability to provide new capital. Alternative lenders aren’t as constrained and have stepped in to fill the void, offering higher loan-to-cost ratios and more flexibility to borrowers.
MSD & BDT Partners, which was formed in 2023 from the merger of merchant bank BDT & Company and MSD Partners, is among those alternative lenders. Last month, it refinanced Steve Ross’ $242.5 million construction loan for the One Flagler office tower in West Palm Beach and increased the debt by $97.5 million.
In June, Grover Corlew scored $92 million from Affinius Capital to develop a seven-story, 312-unit apartment building at 6261 Northwest Sixth Way in Fort Lauderdale’s Cypress Creek area. In March, Stamford, Connecticut-based Post Road Group provided a $206 million construction loan for Baron Property Group’s eight-story, 661-unit Metro Parc North apartment building at 901 East 26th Street in Hialeah.
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