Miami condo project up for sale.

Miami condo project up for sale
The developers of Midtown Miami, which aims to bring condominiums, shops and offices to a formerly neglected part of the city, are attempting to unload a majority stake in the project.
BY MATTHEW HAGGMAN
mhaggman@MiamiHerald.com
Midtown Miami, the massive mixed-use residential development planned for the former Buena Vista rail yard north of downtown Miami, is up for sale.
The asking price: $375 million.
Developer Joe Cayre said Monday he is selling up to 80 percent of the project for tax reasons but hopes to remain in control of it. Real estate broker Edie Laquer, who is selling the property, said they always planned to sell after construction started.
But market watchers immediately questioned whether this is another example of a residential developer trying to limit risk at a time when the housing market has cooled. While real estate sectors such as office, hotel and retail remain strong, residential developers ranging from home builder Lennar Homes to condominium builder Leviev Boymelgreen have recently shed property they don't plan to build on in the near term.
''This is another sign of where this market might be headed,'' said Jay Massirman, vice chairman with real estate brokerage CB Richard Ellis in Miami. ``It says to me that they're worried about the market . . . The challenge will be finding someone to take over their risk position and bet on the market.''
MIDTOWN CATALYST
City officials view Midtown Miami as a key part of the city's revitalization and an important catalyst in bringing people, development and investment into the Wynwood, Edgewater and Design District neighborhoods, among others.
Sitting on roughly half of a 56-acre former railroad yard just south of I-195, the project is to ultimately include more than 3,000 condo units, shops, offices and an entertainment center, said commercial real estate broker Vincent J. Pastore, who is selling the project with Laquer.
To date, one of 11 planned towers is topped off while two others are under construction.
The proposed sale would not include the Shops at Midtown Miami, which sits on the western half of the property. That project, being built by Cleveland-based Developers Diversified Realty, is under construction and slated to bring big-box retailers back to Miami's urban core.
For years, Miami shoppers have had to trek north to Aventura or south to Kendall for large retailers. Anchor tenants at the 645,000 square foot Shops at Midtown Miami are to include the likes of Target, Circuit City and Linens `N Things.
In 2002 Cayre bought the entire former railroad yard site for just $34.5 million, in a remarkable illustration of how much cheaper land was at the time. The chairman of New York-based Midtown Equities then sold half the property to Developers Diversified Realty for the Shops at Midtown, fetching roughly the same price he paid for the entire parcel.
Cayre then formed a development team including Miami Beach-based builder Michael Samuel to build the large mixed-use condo project on the eastern half of the triangular-shaped property.
COOLING RUMORS
In an interview Monday, Cayre dismissed the idea he is selling the property due to fears of a cooling housing market.
He said because he bought the land so cheaply, he can hold with little worry. But by selling raw land instead of finished condo units, he will not be taxed as heavily, he said.
''I almost make the same money building it after taxes then I do selling it now,'' said Cayre, who acknowledged it may be hard to find a buyer willing to buy 80 percent of the project without being granted full control. ``My CFO tells me we have to sell it now.''
Still, some observers remained unconvinced.
''I find it surprising that a developer who took it this far does not see it through, with a controlling interest, until the end,'' said real estate analyst Michael Cannon. ``Typically you don't cash out the general partner until it is all done. The real profits come at the end.''