Paramount Miami Worldcenter Secures $285 Million Construction Loan

Despite the fact that the preconstruction market is cooling off and construction loans are notoriously difficult to obtain, the developers of Paramount Miami Worldcenter have secured a massive $285 million construction loan to fund their luxury project.

“Construction financing is definitely deteriorating,” said Aaron Kurlansky, a principal at FM Capital, a commercial real-estate investment firm told the Wall Street Journal. Mr. Kurlansky said that while at the peak, developers could finance up to 75% of the cost to build a project, now that is down to about 50%.

The construction cost of Paramount Miami Worldcenter is said to cost upwards of half a billion dollars, and the developers have contributed a lot of equity plus raised funds through the popular EB-5 Visa program, which offers an investor visa that transfers to a green card for those foreign investors who contribute $500,000 to a project that creates jobs.

According to the developer’s representatives, the residential tower is 60% sold and is continually selling at a rate of around 10 units per month. While this number is not as impressive as the 20 sales per month that they had become accustomed to during previous years, it is far better than many other developers are faring. In some less-popular projects, we have seen months pass with only a handful of sales. Paramount Miami Worldcenter will have 562 units priced at an average of $750/foot.

This construction loan is the second largest in the last two years, according to The Real Deal. The only loan secured that was larger was The Residences at Armani Casa, which was $305 million.

Paramount Miami Worldcenter Offers an EB-5 Program That Includes a Condo

With all the excitement surrounding Congress’s vote to extend the EB-5 Visa program through December, it is important to note that not every project that markets as an investor visa opportunity is in fact approved as such. Investors must choose wisely when going into any investment, but even more so with the EB-5.

I have seen agents advertising resale condos as an EB-5 opportunity. Going into this transaction will get you the condo, but since the necessary 10 jobs are not created through that purchase, no visa will be granted.

Aspiring developers will sometimes also collect EB-5 funds in order to raise capital to purchase the land for a project but have not yet obtained any of the permitting for the project or for the EB-5 offering. This is extremely risky as the project could never happen. The funds could be lost, time would be wasted and no visa would be granted.

Other opportunities will secure the visa, but not pay a return during the construction of the project.

I have only seen one EB-5 opportunity that will grant the investor a visa, a condo and a return. The Paramount Miami Worldcenter EB-5 offering seems to be the most beneficial and secure investment currently on the market.

Their program is a 5 year offering with 0.5% interest paid annually. Paramount Miami Worldcenter will be completed in 2.5 years, in which case the client could close with cash, finance the remainder of the balance or delay the closing and lease the apartment through the developer’s rental program. The initial visa arrives after the investor’s application is approved, and the investor can apply for citizenship after 5 years.

I like this project because it is already under construction and 55% sold. This is happening. Only 10% of the project financing is coming from EB-5, so over 40 jobs will be created per applicant. The condos are really amazing and the project is transforming the Downtown Miami area, so it is very exciting.

Of course, there are other EB-5 offerings available in the area… SkyRise Miami, Panorama Tower, a few restaurants (including Dunkin Donuts, Tap 42 and Meat Market) and I’ve heard One Thousand Museum has begun its application.  Paramount Miami Worldcenter is still my favorite since they offer relative security, the return, the condo and the visa.

Here is more information from their presentation. Let us know if you would like a presentation as well.

Paramount Miami Worldcenter Claims it Will Have the Most Amenities in the World

Paramount Miami Worldcenter, the flagship residential tower of the gigantic Miami Worldcenter megaproject has publicly declared in promotional emails that it will have ‘The Most Amenities in the World.’ It’s a pretty bold statement that demands some scrutiny. Somebody call the Guiness Book of World Records, because we need to fact check that wack.

Here’s the building’s amenity list for comparison. More renderings are below as well.

Paramount Miami Worldcenter Adds Indoor Observatory to Rooftop Sky Deck

Paramount Miami Worldcenter’s upcoming rooftop ‘Sky Deck’ complex will a little less open to the sky, with the luxury condo tower’s latest design tweak, made by developer Dan Kodsi. The Real Deal got the low-down from Dan. A portion of the multilevel, yacht-like complex of decks, pools, and lounge areas that is going at the tower’s top is being enclosed in 12-foot floor-to-ceiling glass, with panoramic views. The new observatory’s telescope (Telescopes? A new rendering shows more than one) will connect to a large digital screen, for group sky-gazing. Finally, a specially added glass elevator just off the 56th floor lounge will take those ‘looking up’ to the 1,200 foot observatory on the building’s 60th floor. Paramount construction, meanwhile, is still in the very early stages, leaving plenty of time for design tweaking like this.

Paramount Miami Worldcenter Construction. Photo by Michbelle La Llave.

New Video Released for Paramount Miami Worldcenter Showcasing the High Street Retail

A new video was released today for Paramount Miami Worldcenter and includes footage of what the high street retail will look like once finished. Well, the video isn’t exactly new. It’s an edited video with all references of the mall removed and, in its place, new footage showcasing the high street retail. Spoiler alert: It looks amazing!

Paramount Miami Worldcenter Going Vertical In August

Miami Worldcenter Overview.

Daniel Kodsi, developer of Miami Worldcenter, gave the Real Deal a quick update on the progress of the megaproject. Having formally broken ground a few months ago with a lavish groundbreaking to-do (and physically broken ground months before that), the Worldcenter’s marquee tower, Paramount Miami Worldcenter, along with the attached retail and entertainment street at its base, is on schedule to begin vertical construction in August. Check out the video to see Ina Cordle rapid fire questions at Kodsi, for updates on sales, who’s buying, completion, etc.

https://youtu.be/aNTCkl0OHXw

Week in Review: Brickell Backyard Section of The Underline Receives Large Donation, Auberge Reserves 50 Units in 5 Days and Other News

This week brought great news for supporters of The Underline, a new park that is being developed beneath the Metrorail lines from the Miami River down to Dadeland. Each station is individually funded and the Brickell Backyard section received a $75,000 donation this week from local developers.

The Underline will begin construction in the Brickell phase and continue down 10 miles of the rail tracks. They have also secured $5 million in grants and funding from developer impact fees, Miami Dade County and Florida Department of Transportation. Friends of the Underline CEO & founder, Meg Daly hopes to begin construction by the end of 2016.

Residents of Brickell have been increasingly vocal over recent years regarding their desire for more park space but have lost out due to the laws of economics. The Underline is a solution that meets the needs of everyone involved, as the area underneath the rail tracks is not able to be sold and developed, but is available for public use. Think: the opposite of New York’s High Line… Underline will be a welcome addition indeed. [The Real Deal]

Speaking of the laws of economics, The Next Miami is reporting that the location of Brickell’s Burger King could face the wrecking ball in favor of a 960 foot tower. It appears that plans have been submitted to the FAA requesting permission to build up to 960 feet above sea level on the site.

Before you cancel your reservations on your north-facing apartments at Brickell Heights and hoard a box of Whoppers, let’s take a look at all of the evidence. Yes, a tower could be built on the land and this will likely happen one day. No, the Burger King strip center is not the highest and best use of the lot (particularly after Brickell’s recent growth spurt). We do believe that a tower will be built on the corner, but the likelihood of it happening anytime soon is very low.

The parcel of land at 10 SW 8th Street includes the Burger King on the east side all the way over to La Sandwicherie on the west side. The shopping center was last sold back in 2006 and no developer has been named for this proposed tower. Since shopkeepers in the strip center have been open about the fact that the building is being prepared for a sale, we sense that the proposal is simply a plan to increase the value of the lot in preparation for going to market. Whether or not the sale would happen quickly is another conversation altogether. For the foreseeable future, we will continue to enjoy our late-night La Sandwicherie subs in peace. [The Next Miami]

A little further north, Auberge Residences and Spa certainly had a large week. They released their first inventory on February 10 and successfully reserved 50 apartments in their first 5 days on the market! Given the feedback we have received, we hope that the lucky buyers who were able to secure a reservation hold onto their position when contracts are issued. Many people were disappointed to learn that certain floor plans have already been spoken for. Contracts are expected in late March. [The Next Miami]

While buyers were scurrying for opportunities in the Arts District, buyers of Miami Worldcenter have been scavenging for information regarding the revamped plans of their shopping center. This week finally brought additional details with renderings of the new open-air shopping concept that will replace the enclosed mall that was originally planned.

Some have praised Miami Worldcenter for their revised plans and some have begun to question the development. Have a look at the new renderings and let us know what you think… [Curbed Miami]

Week in Review: How to Avoid the Federal Disclosure Law for Cash Purchases and Other News…

Rendering from Paramount Miami Worldcenter

Week of January 17-23, 2016.

The US Treasury announced this week that starting in March, title companies will be required to disclose the identities of buyers to government regulators for all cash purchases above $1 million in Miami’s residential real estate market. They are hoping to put a stop to illicit funds being laundered through the cash purchases, but effectively are also spooking legitimate buyers who simply do not wish to have their buying habits publicly disclosed.

Fear not, fancy condo shoppers. The ink is not even dry on the new order and The Real Deal has already compiled a list of 7 ways that the rule can be circumvented. [The Real Deal]

Last week, the developer of Miami Worldcenter announced that it is scrapping the plans for an enclosed mall just days after Macy’s announced multiple store closings due to slow sales. After this announcement Taubman and Forbes cancelled their contract with Worldcenter, causing a flurry of rumors and news stories stating that the project would be scrapped. It turns out that everyone jumped the gun. According to the developer and this Taubman release, the project is not scrapped. The contract just needs to be renegotiated to reflect the new building plans. [Zacks]

While everyone was up in arms about the potential drama at Miami Worldcenter, Brickell CityCentre released their updated list of all retailers, shops and restaurants that will be opening with the mall. The shops will begin individual build-out soon and is scheduled to open later in the year. [The Next Miami]

In possibly the least surprising news of the week, Car2Go finally announced that they are suspending service effective March 1. They say that the reason for the service-shuttering is low ridership and high state taxes, locals have not wasted time or minced words with their own theories. It seems they have been in trouble with their client base for some time due to poor handling of a PR incident involving a drunk driving accident, not offering service in many important areas of the community, poor customer service and unreliable service. We think it can be easily explained by simple economics… why pay more to drive yourself in a shared smart car with a complicated service when you can pay less and have an Uber car pick you up at your doorstep and drop you off wherever you want to go? The choice is simple. [Curbed]

Miami Worldcenter Opts for Open-Air Shopping; Residential Amenities Remain Unchanged

News spread earlier today that Taubman has opted to turn Miami Worldcenter into an open air shopping mall rather than the originally planned enclosed mall. We found this to be great news, as open air malls have been more sought after by shoppers in recent years, leaving hoards of enclosed malls vacant and in need of redevelopment throughout the country. The open air plan will also likely be less costly to build.

The shopping center had been slated to be anchored by Macy’s and Bloomingdale’s, although it is not clear at this moment whether they are still on board. Just last week, Macy’s announced it would be closing 40 stores due to dismal holiday stores.

Construction is already underway on Paramount Miami Worldcenter, the luxury residential component of the development. Many people have contacted us regarding these changes and how they affect the condo portion. The developer has reassured us that the changes in the retail component will not affect the amenities slated for Paramount.