Portion of Development Site Sells for $64M
AVENTURA, FL-A partnership controlled by Chatham, NJ-based Brian Stolar has acquired a portion of the Lincoln Pointe development site for $64 million. Development partners New York City-based Tarragon Corp. and Miami-based Shefaor Development were the sellers.
Under terms of the agreement, Tarragon and Shefaor’s ownership of the site was reduced to 79.5% and $14 million of preferred equity. The buyer has agreed to purchase the $14 million in preferred equity within 18 months or full ownership will revert back to Tarragon and Shefaor.
Under the agreement, Tarragon and Shefaor also granted the partnership a three-month option to purchase an additional 61% ownership for $12 million. If the partnership exercises the option, Tarragon will retain an 8% interest in the property and Shefaor about 10%. Shefaor has also been retained to coordinate and supervise the new development for a fee based on the ultimate sell-out value of the project. Tarragon chairman and CEO William Friedman tells that Tarragon and Shefaor decided to sell their interest in the project to reap the profits and “take some of our chips off the table.” “If the partnership does not exercise the option, then we’ll develop the property.”
Friedman adds that Tarragon and Shefaor plan to begin marketing efforts in the fall with demolition of the existing building to begin in about a year. “The timing depends on how quickly plans develop and the pre-sales efforts,” Friedman says.
Tarragon and Shefaor bought the 285-unit Lincoln Pointe Apartments for $41 million in 2004 and had originally planned to convert the complex into condominiums. However, the companies scrapped those plans in favor of constructing a new 460-unit high rise condominium tower. The project is situated on a peninsula just northwest of the Williams Island Marina on a 9.1-acre waterfront site at 17900 N.E. 31st Court. Tarragon and Shefaor has prepared preliminary plans and obtained development approvals for the new plans.
“We purchased this property intending to convert an older apartment project to condominiums. Although that strategy was sound, we realized that the site’s highest value could be obtained through more intensive development,” Friedman said in a prepared statement. “We worked closely with neighborhood groups and the town of Aventura to put together a development plan that met the town’s stringent requirements for what will probably be the last waterfront high-rise to be developed in that highly sought-after community.”