Work crews are on the ground at Plantation’s long-vacant Fashion Mall, starting a multimillion-dollar facelift to reposition the failed shopping center as a bustling mixed-used development with branded hotel, conference center, condominium tower and top-tier office space.
The developer, US Capital Holdings Group, started work in January on a $10 million project to convert an office tower on the site from Class B to Class A space.
Crews have spent weeks working on the lobby and common areas, installing new finishes, elevators, air-conditioning systems, new technology and upgrading the parking garages.
The goal is to start leasing the upgraded space in the seven-story building at market rates and have tenants in by the first quarter of 2015.
The new space will target multinational, national, and regional corporations, said US Capital Holdings LLC CEO Wei Chen.
“We always felt the area was underserved,” said Grace He, COO of US Capital Holdings LLC.
The once-luxury mall crumbled during the economic downturn, facing a series of hurdles, including multiple foreclosure suits between 2007 and 2012. It has been vacant since 2008.
But US Capital Holdings executives say a strengthening economy, shifting demographics and consumer demand for walkable communities that combine retail, commercial and residential components justify redeveloping the former shopping center north of the Broward Mall and Interstate 595.
“We believe market conditions have improved substantially,” said John Tombari, director of construction.
And this month, starting with the office tower, US Capital plans to convert the site into a $300 million lifestyle center with retail, dining, entertainment, cultural centers, office space and about 600 condos, according to promotional information for the development, now rebranded 321 North.
“It’s more destination-driven with live, work, dine under one roof,” said He, US Capital Holdings’ chief operating officer.
In January, US Capital Holdings got city building permits to start work on the office tower—the first of five development stages to span about three years. It hired general contractor GHJ Construction Inc, a subsidiary of Beijing Construction Engineering Group International Co Ltd. The group plans to submit site plans to the city by the end of the first quarter and complete the redevelopment by 2017.
Plantation-based US Capital Holdings is part of several related companies, the US Capital Holdings Group or USCHG, formed in 2004 to invest in U.S. real estate using capital from China. Its business model centers on investing in undervalued properties then repositioning them for stronger returns. It made multiple investments between 2004 and 2007 to acquire property around the former Fashion Mall.
The time might be right to re-launch the revamped 321 North with the goal to target workers, residents and visitors, analysts suggest.
Mixed-used developments that combine residential with commercial and entertainment components are emerging as top revenue earners, said Gerard Yetming, senior vice president of CBRE Inc.
And in Plantation, a strong residential market is driving demand in office, retail and other sectors. With a 4.5 percent vacancy rate that’s set to tighten this year for multifamily units, Broward real estate market benefits from continued population growth and 23,500 jobs created in the county last year.
“What we’re seeing in South Florida in general is a preference for tenants to live in developments that have that live-work-play environments,” Yetming said. “Developments that have live-work-play environments tend to get very strong rents so developers are trying to capitalize on that potential.”