The American Dream is alive and well in the mind of Iranian-Canadian developer Eskandar Ghermezian. He and his family-owned conglomerate, the Triple Five Worldwide Group, want to build American Dream Miami on more than 200 acres of former cow pasture by Interstate 75 and Florida’s Turnpike in northwestern Miami-Dade County.
Triple Five’s representatives claim that, if completed, American Dream Miami will be the largest shopping mall and entertainment complex in the United States. According to the most recent plans, American Dream Miami would be 6.2 million square feet and cost about $4 billion to build.
Some of the components described thus far include a 16-story indoor ski slope, a 20-slide water park, a submarine ride in a man-made salt water lake with an artificial reef, a climate-controlled theme park, a 14-screen 3-D movie theater, a performing arts center, a 2,000-room hotel and much, much more.
American Dream Miami would also have as much as 3.5 million square feet of retail space. In contrast, Aventura Mall, the third-largest mall in the U.S. and Florida’s biggest, has 2.7 million square feet of retail.
Bob Gorlow, a real estate adviser and developer based in Coral Gables who represents the Ghermezians, said in an interview that the family has been working on the American Dream project “for years” and his clients hope to begin construction in 2016 and complete it within three years.
“We’re just completely excited,” Gorlow said. “This will be a tremendous boon not only for the Ghermezian family but also the county and business as a whole.”
American Dream Miami’s developers aren’t just family members; they run an empire together. Through Triple Five, the Ghermezians have ventures involved with real estate development, solar energy, oil drilling, vehicle manufacturing and mining. And it all started with carpets and silk rugs.
Triple Five’s founder was Jacob Ghermezian, a Jewish carpet merchant who emigrated from Iran to New York in the 1940s and later to Montreal. In the 1960s, the Ghermezians moved to Edmonton, Alberta, where Jacob and his four sons — Eskandar, Nader, Raphael and Bahman — embarked on a new family business: buying and selling real estate. By the 1970s, according to a 2004 article, “the Ghermezian family had amassed the largest private portfolio of land in Alberta, and Jacob handed control of the company to his eldest son, Eskandar.”
In 2010, the Jerusalem Post estimated the Ghermezian family’s worth at $4 billion. Intensely private, Eskandar Ghermezian rarely gives interviews; nobody in the family had returned phone calls from The Real Deal by press time .
While Eskandar heads Triple Five and is purportedly calling the shots in the American Dream Miami project, Nader — who is chairman of the company — is listed as the sole owner of International Atlantic LLC, the Triple Five subsidiary buying land for American Dream Miami.
Gorlow confirmed that Nader is involved with the American Dream Miami project, as are other members of the Ghermezian family, including Eskandar’s son Don. “The family works as a unit through Eskander,” Gorlow said.
Jack Osterholt, deputy mayor of Miami-Dade County, added: “[Eskandar] clearly knows what he wants and how it’s supposed to go.”
Business isn’t Eskandar ’s only motivation for building a mega-mall in Miami-Dade. He has adult children living in the county, including a daughter who married a Miami man, said Michael Hernandez, a spokesman for Miami-Dade Mayor Carlos Gimenez. “A very big reason for why he wanted to do this was to make this his legacy project in Miami-Dade County,” Hernandez said.
Eskandar admitted to Florida Gov. Rick Scott and his cabinet that his family was initially against building such a large project in Miami-Dade, according to the official transcript of the April meeting.
“To build [a] $4 billion [project], my family says, don’t do it. The family says, don’t touch it, don’t do it, we don’t need it,” he told the cabinet. “I told [county officials] when I was talking with them, my wife told me that, when you go there, build a small project so we can come to Miami. She tells me today, I didn’t tell you to build something like that,” he added.
If approved, American Dream Miami won’t be the Ghermezian family’s first super-mall. In 1981, Triple Five built the 5.3 million-square-foot West Edmonton Mall in Alberta. Now the largest mall in North America, West Edmonton Mall has a giant water park, carnival rides, a casino and other forms of amusement.
By 1992 the Ghermezians had co–developed the 4.2 million-square-foot Mall of America in Minnesota, with an aquarium and the Nickelodeon Universe theme park among its features. News reports label the Mall of America the largest shopping mall in the United States; Triple Five recently broke ground on a $325 million project to expand it further.
Triple Five also just started constructing American Dream Meadowlands in East Rutherford, New Jersey, a 4.8-million-square-foot retail and entertainment facility near the Meadowlands Sports Complex. Using $2.5 billion in private bond money and $1 billion from the state of New Jersey, Triple Five will be building hundreds of stores, dozens of restaurants, a 12-story-tall ski slope, a 200-foot drop ride, a giant aquarium and a water park.
At press time, Triple Five had yet to submit a formal application to Miami-Dade County, so its details for the Florida project may change. (Apartments and a live sea lion show have already been scrapped.) That formal application may come by the end of November, according to Osterholt. The project would require changing the land’s zoning from industrial and commercial to something that allows for a giant mall with a lagoon and a towering, enclosed mountain of snow.
County and state approval of the American Dream Miami proposal is far from assured. The developer must usher the project through a several-months-long approval process.
Staffers from Miami-Dade and Broward counties and various state agencies are already analyzing the potential impact American Dream Miami would have on the area’s environment, roads and water supply. A preliminary report from Miami-Dade County projected that American Dream Miami would use 965,000 gallons of water a day.
In terms of traffic, Triple Five estimated that American Dream Miami would generate slightly less than 61,000 trips daily, according to a technical report submitted to the county on Sept. 3. That differed from Triple Five estimates provided to the Florida Department of Transportation in February and March projecting as many as 127,000 daily trips, according to the Miami Herald. Gorlow told The Real Deal that last spring’s figures had been preliminary and therefore inaccurate.
The Ghermezians will need to install infrastructure from scratch. “There are no utilities there at all,” Osterholt said. “There’s no water, no sewer, no electric.”
Calling it an “unusual project,” Osterholt asserted that American Dream Miami has the potential to create at least 25,000 jobs. “It’ll be the largest job center in the county, larger than the airport,” he said.
That’s why Osterholt’s boss, Miami-Dade County Mayor Gimenez, is supportive, at least thus far, of American Dream Miami. Gimenez even journeyed to Tallahassee with the Ghermezians in April to persuade the governor and his cabinet to permit the sale of 82 acres of land once earmarked for a school to Triple Five for $19.5 million. In spite of opposition from representatives of General Growth (the owner of Bayside Marketplace in downtown Miami) and Simon Property Group (the owner of Sawgrass Mills in western Broward County), who said the state should put the parcel out to bid, cabinet members unanimously authorized the sale.
A subsidiary of Triple Five has also bought 24.6 acres of land from Rocco Inc. and Tract 32 LLC for $10 million. The rest of the land for the proposed complex, mostly belonging to the Graham Companies (owned by former Sen. Bob Graham’s family), is under contract to be purchased by Triple Five.
Some residents have voiced concern that American Dream Miami will further clog Miami-Dade’s highways, encourage urban sprawl further west into the Everglades and drain the region’s fresh water aquifers.
An online petition opposing American Dream Miami, circulated by a David Decespedes, has attracted 889 signatures. Raquel Regalado, a member of the Miami-Dade Public School Board who will likely run against Gimenez for the county mayor’s seat in 2016, has criticized the project, claiming it will bring only low-paying jobs.
Katy Sorenson, founder of the Good Government Initiative and a former county commissioner, referred to American Dream Miami as the “American traffic nightmare,” saying, “Considering that traffic is the No. 1 issue that everyone talks about and is so sick of, I don’t understand why anyone can think putting such a huge development that would create such traffic nightmares for everyone involved makes sense.” Sorenson also doesn’t understand the mayor’s support. “It doesn’t seem that we have a crying need for more shopping malls.”
Gorlow insisted, however, that the county won’t be swamped by traffic caused by American Dream Miami and that most of the vehicular travel would occur during nonpeak hours as tourists and families pursue a day of fun and shopping. “Fortunately there are two major highways there,” he added. “Therefore, the opportunities seem to be good [for] orderly access.”
If built, American Dream Miami will join a county brimming with retail. According to the CBRE Group, Miami-Dade County already has 44.6 million square feet of store and restaurant space in shopping centers, strip malls and mixed-use projects. Another 1.9 million square feet of retail are already under construction.
More than 5 million square feet of retail space are in the pipeline for Miami-Dade County, according to a recent CBRE report on its retail market, with more than half of that figure associated with American Dream Miami; other projects include an expansion of Aventura Mall and Mediterranean Village in Coral Gables.
Could it be that the American Dream is being contemplated at a time when Miami’s retail market is oversaturated?
No, said Quinn Eddins, CBRE’s director of research and analysis. If anything, Miami-Dade’s 3.6 percent retail vacancy rate, among the lowest in the country, indicates an insatiable demand for retail.
“Overall, even with the grand scope of development in Miami, we can support this mall,” Eddins said.
What’s less clear is how American Dream will affect retail rents at existing malls and shopping centers. Currently a wide range of retail rental rates prevail throughout Miami–Dade County. “If you mix everything together, we are about $43 a square foot,” Eddins said. “When you look at mixed-use [retail] we’re at $102 a square foot.” At Lincoln Road and Brickell City Centre, rents can reach $400 a square foot, he added.
“I think the rental rates will hold … based on the demand, based on the increase in tourism in Miami and the population growth,” Eddins said. (Gorlow said Triple Five has not figured out what sort of rents American Dream Miami will demand.)
The fact that the project is being built just a few miles from rock mines will provide somewhat of a buffer for most of Miami–Dade’s high-end shopping malls located east of Interstate 95, Eddins said.
“They’re doing this near highways that have access to almost all of South Florida within a 30-minute drive,” said Jonathan Gerszberg, vice president of investments for the commercial realty firm Marcus & Millichap. The project may even attract residents from Collier County along the west coast of Florida, he added.
Greg Masin, Cushman & Wakefield’s senior director of retail in South Florida, emphasized that Triple Five isn’t just building a mere shopping mall. The family firm is building a destination. “There won’t be anyplace else where you can ski or do these other different things,” he said.
Shopping will be the moneymaking component, though. As Eskandar Ghermezian put it to Gov. Scott’s cabinet in April: “I’m going to lose money on the retail amusement park, but on the retail part, yes, you are right, I make a little money supporting the amusement.”
Some of the stores and restaurants in exist-ing shopping malls, especially those west of Interstate 95 like Dolphin Mall and Sawgrass Mills, may take a hit in business once American Dream Miami is completed, predicted Beth Azor of Azor Advisory Services, a retail consulting service. “In the short term there’s always an effect,” she said. “There’s always a ‘new’ period of time where everyone wants to check out the new thing.” That effect will be temporary, she said.
Gorlow predicted existing shopping malls won’t experience any dip in business from American Dream Miami; instead the new complex will draw additional tourists to South Florida. “It’s something that expands the appeal of South Florida and Miami–Dade County not only for people who live here but visitors and tourists,” he said. “And it makes the pie bigger for everyone.”