Saul Ewing Arnstein & Lehr attorneys represented Property Markets Group in the $55 million buy of a downtown Miami church, where Property Markets Group plans to build an apartment building.
The 690-unit tower will be part of a new type of PMG project built to give professionals a convenient urban lifestyle. The buildings will have areas such as communal kitchens and co-working space.
“They are building their own urban-life community within the building. Those common areas are designed to create a community among the tenants and allow them the work-live-play concept and enable them to do that within their own community and then hopefully walk to work,” said Rebecca Abrams Sarelson, one of the attorneys who worked on the deal.
PMG bought the 1.15-acre site at 400 Biscayne Blvd. from First United Methodist Church of Miami Inc. in a deal that closed Jan. 18.
Sarelson and Luis Flores, both Saul Ewing Arnstein & Lehr partners in Miami, and David Yontz, a Chicago associate, worked on the purchase.
Bilzin Sumberg partner Joshua Kaplan represented PMG on real estate investment trust issues.
This was an atypical deal, Flores said.
“Normally, the case is I am buying a piece of land, I am getting a deed, and I am never seeing my seller again,” he said.
In this deal, the church and PMG have a long-term relationship. PMG bought the site from the church, and PMG will build a space for the church in the apartment building, with the church paying its share of the cost for its space, Flores said. The church also helped finance the deal, he added.
That made PMG the buyer, builder and borrower, making the deal complex for its attorneys.
“We had to wear multiple different hats. We had to wear hats as the buyer, borrower and as the builder. What that creates is you have to be equally balanced and fair-minded in each of these negotiations so that there is a positive outcome for the long-term relationship that has goodwill fostered going forward,” Flores said.
PMG’s partner on the project is Greybrook Realty Partners, according to Flores. It’s the real estate investment and asset management division of Toronto-based private equity firm Greybrook Capital, which invests in real estate and health care, according to its website.
The first phase of the project is to have the 690 units and 20,000 square feet of commercial space, including retail and a restaurant. Details on the second phase haven’t been released.
PMG is building X Social Communities, apartments that cater to professionals seeking convenience in an urban area, across the U.S., including three in South Florida.
Aside from the project at 400 Biscayne Blvd., in the pipeline are the 464-unit X Miami at 230 NE Fourth St. to be finished this fall and the 650-unit first phase of X Las Olas in downtown Fort Lauderdale to be finished in winter 2020, according to the X Social Communities website.
In Chicago, it already opened the 120-unit X Logan Square and is working on the 99-unit X University Village to be finished this fall. In Denver, the developer is working on the 220-unit X Denver due in summer 2020, according to the X Social Communities website.
In total, the New York-based company plans more than 5,000 units in its X Social Communities, or XSC, portfolio.
Several potential bidders approached the First United Methodist Church of Miami, according to Flores.
“When they were deciding which developer to go with, it was important to them that the vision of that developer included church design. They had confidence in that developer (PMG) to build a church that matched up with that church’s personality,” Flores said.
In this respect, the deal also is beneficial for the church.
“The timing was right for the church to take advantage of the revitalization in the neighborhood and gracefully grow together with the thriving city around us. This sale will provide a new structure and parking to meet the church’s future operating needs and the resources to grow the ministries of this downtown campus,” Pastor Audrey Warren said in a news release.