If you think the development of University Bridge housing to open in 2020 for Florida International University students has been a smooth, straightforward process, then you are wrong.
It took an assemblage of several lots and a condominium termination to get the site together, project approval from the city of Sweetwater, securing a $228 million project bond, more city approval, the backing of FIU’s board of trustees and the $48.6 million site sale, all with Holland & Knight attorneys guiding the Miami developer.
“This deal has been complex from day one,” said partner Vivian de las Cuevas-Diaz, who has been involved throughout.
The 20-story, 886-unit University Bridge is set to rise north of campus at 740 SW 109th Ave. and open in time for the 2020-21 academic year.
Most recently, de las Cuevas-Diaz and senior counsel Isabel Diaz represented Collegiate Suites Miami LP, which is run by Global City Development LLC, in the sale of the 1.7-acre site to University Bridge LLC, which is run by nonprofit affordable and student housing company Atlantic Housing Foundation Inc. The deal closed Sept. 25.
The duo also helped Global City negotiate the bond financing, although de las Cuevas-Diaz and Diaz didn’t negotiate the bond terms, de las Cuevas-Diaz said.
While Atlantic Housing is the borrower, Global City negotiated that financing with help from the Holland & Knight team, de las Cuevas-Diaz said.
“They are truly the ones who put it all together. They were the magicians behind the deal,” she said. “When they closed, the acquirer, University Bridge, aka Atlantic Housing, they are who signed the dotted line and took the debt.”
The sale and bond financing, which took a year to complete, went hand-in-hand in this deal.
Global City and its project partners, real estate and financial consulting firm RER Financial Group LLC and Toronto-based Podium Development Corp., are the University Bridge developers.
The sale to the nonprofit was completed as a requirement to obtain the bond financing, said Brian Pearl, a Global City principal.
“As part of a private-activity bond, what you have to do is a lot of the cash flow is dedicated to charity and also to the school, to FIU. In order to be able to make those contributions you need to, at the closing of the bond, transfer the deed over to a nonprofit, a 501(c)(3),” Pearl said. “We are still developing it. All the same things are happening but it’s a different structure. The property wouldn’t have been transferred to the 501(c)(3) if we weren’t issuing the bond. The only way to issue the bond is to have a borrower that’s a nonprofit.”
The sale, which breaks down to about $54,812 per unit, and the University Bridge development were the culmination of years of work by Holland & Knight attorneys, each one taking on different project aspects.
For one, de las Cuevas-Diaz and associate Jorge Escobar represented Global City when it used an affiliate in 2016 to buy the site for $16.6 million, a purchase complicated by the required condo termination.
Associate Alejandro Arias represented the developer in obtaining land use and zoning approval from Sweetwater.
The work done by each Holland & Knight attorney was a slice of the bigger pie.
“This sale is the culmination of a lot of hard work by my clients and us assisting them. … That’s why it’s important to understand how they put all these properties together. Then Alex Arias, he was the one who was working on the approvals for the city of Sweetwater. If he doesn’t work on those approvals for this development for this student housing development, this doesn’t get sold and financed,” de las Cuevas-Diaz said. “Everything here was in line to either build it themselves or sell. It was all a piece of the pie.”
The city and FIU’s board also had to sign off on the trade because of the bond financing aspect, de las Cuevas-Diaz said.
“This isn’t just Atlantic wants to do this and Collegiate Suites wants to do this, great, we enter an agreement, and we move on,” she said. “You had two huge organizations that had to absolutely approve it, rubber-stamp it and get behind it.”
The bond’s face value is $227.6 million, but $231 million was raised because it was obtained at a premium, Pearl said.
The bond is for project development as well as for FIU programs, he said.
Regions Bank is the bond trustee, according to de las Cuevas-Diaz, who noted multiple attorneys representing different entities worked on this.
“It was a lot of coordination and keeping the train on the tracks,” she said.
Coats Rose, director of the Cincinnati office of Ronald Bell, was counsel for University Bridge LLC, and Greenberg Traurig shareholder Robert Gang in Miami was bond counsel.
Global City originally developed the concept as student condos but switched to student rental housing. Although it hadn’t closed on any unit sales, it canceled about 200 purchase contracts, Pearl said.
The University Bridge site is just north of the 175-foot, 950-ton pedestrian overpass that collapsed in March, killing five people in vehicles and a construction worker. The bridge was meant to be a safe crossing between FIU and Sweetwater.
The collapse had no impact on the closing of this deal or the project.
De las Cuevas-Diaz praised the work that went into the multistep process leading up to project development.
“This sale is the culmination of really a lot of hard work by my clients and us assisting them,” she said.