3650 REIT last week originated a $170 million loan to Newgard Development Group for a 44-story apartment tower in Miami with a unique twist: the property is geared toward short-term renters. Lotus Capital Partners arranged the financing.
The commercial real estate lender believes Miami is a hot spot for multifamily as the city has recently seen explosive population growth as companies and new residents flock to South Florida.
“Despite the national environment becoming more challenging for completing deals, the multifamily sector continues its growth, albeit at a slower clip than last year,” Jonathan Roth, 3650 REIT co-founder and managing partner told Real Estate Capital USA.
This is the lender’s second lot of financing for the LOFTY Brickell property following a $60 million loan for the land acquisition late last year.
“We believe that the LOFTY Brickell project, with its prime location, walkability, best-in-class amenities and unique business plan, will offer residents unmatched flexibility and help accommodate the increased demand for housing as more people move to the area,” added Roth. “These factors will make the property a change winner following the transformative years of the pandemic.”
These factors all make the deal a good fit for 3650 REIT, which targets financing well-located multifamily properties with sponsors who employ value-add business plans at unique locations.
“We believe that the property’s unique business plan to accommodate short-term rental ownership will make it a change winner in the post-pandemic South Florida market as more residents seek flexibility and convenience in their living arrangements, and we expect to see sustained long-term demand for these types of units,” said Roth.
As well as offering studio, one- and two-bedroom units, the property also features 40,000 square feet of amenities. These include a private marina, a waterfront restaurant, a members-only social club, a resort pool deck and fitness center, as well as a cigar lounge and meeting rooms. Digital art has also become an integral part of the new residential building.
This is the latest of Newgard projects. Other recent notable projects include Natiivo Austin, Natiivo Miami, Gale Residences Fort Lauderdale Beach, Gale Hotel, BrickellHouse, Centro and One Flagler.
The firm, led by CEO and founder Harvey Hernandez, has developed and managed projects ranging from $2 million to $250 million in key markets with a focus in Florida, Texas and Tennessee.