Two apartment complexes on the island of Normandy sold for 22 million dollars
A pair of Normandy Island waterfront apartment complexes swapped – one as a potential development site – for a combined $22.2 million in two deals involving different buyers. Both properties are two-story garden-style buildings on Bay Drive in Miami Beach.
stone on the bay
Magnum Holding Company, a U.S. subsidiary of family-owned Montreal real estate investment firm Trams Property Management, paid $15.2 million for the 70 Pierre on the Bay units at 2050 Bay Drive and adjacent vacant land at 2095 Bay Drive, according to a press release.
The sale breaks down to $198,571 per apartment.
Shelly Argy and Ryan Shaw with Marcus & Millichap represented seller and buyer.
The seller, a subsidiary of Aventura-based Gulf Group Holdings, led by Jonathan Politano, bought the Pierre on the Bay and the vacant lot for $7.3 million in 2019, records show. Now, three years later, the Politano subsidiary has sold the properties for more than double the purchase price. Both buildings were completed in 1951, records show.
A spokesperson for Marcus & Millichap said via email that the apartment complex can be redeveloped into a five-story, 44,256-square-foot residential building under current zoning, but the buyer has not no plans to redevelop the property at this time. Politano had previously indicated that he was considering building condos on the site eventually.
Pierre on the Bay is 61% occupied, with average monthly rents of $1,090, the spokesperson said. The apartment complex and vacant land went up for sale in June with an asking price of $15 million.
In a statement, Argy said Pierre on the Bay had attracted interest from developers and multi-family investors. The property offers panoramic views of Biscayne Bay and direct water frontage of the 79th Street Causeway.
Villas in Normandy
A local company affiliated with Gustaf Arnoldsson, chief financial officer of SMS Lodging, a Miami-based real estate investor, has purchased Normandy Villas, a 22-unit apartment complex at 946 and 950 Bay Drive for $6.4 million, according to the seller’s broker, Joseph Thomas.
Arnoldsson’s company paid $290,090 per apartment.
Thomas and Adam Duncan led a Marcus & Millichap team to broker the off-market deal.
The seller, Chehebar Brothers B LLC, run by Rafael Chehebar of Miami Beach, paid $2.5 million for Normandy Villas in 2010, records show. Both buildings were completed in 1944 and 1955.
Normandy Villas offers one- and two-bedroom apartments, but none are currently available, according to Apartments.com.
Thomas said The real deal that Normandy Villas monthly rents average around $1,700. “It’s just under $2 a square foot,” Thomas said. “The buyer projects [new rents] in the mid to upper $2 per square foot.
Arnoldsson’s entity has no plans to redevelop the apartment complex in the near future, Thomas said. “They just plan to operate the property as a quasi-luxury, high-rent property after the renovation, and keep it as a cash-flow apartment building,” he said. “They plan to clean up and make cosmetic upgrades to the property to meet the market rents available today.”
Investors remain optimistic for multifamily properties in South Florida, particularly in Miami, where tenant demand has led the United States to increase rents during the pandemic. Since March 2020, the median apartment rent in Miami has climbed 58% to $2,988 per month, according to a report by Realtor.com.
But some investors are considering redeveloping old South Florida apartment buildings into new condos. Another Canadian company, Camaco, recently paid $9.3 million for the 23 Stratford apartments in Pompano Beach. Camaco has submitted preliminary plans to the City of Pompano Beach to redevelop the property into a boutique condominium called Entourage Under The Sun.