Los Angeles-based Canyon Partners Real Estate has provided a three-year, $133.7m senior construction loan to Property Markets Group (PMG) and joint venture partner S2 Development for the development of the Muse Residences in Sunny Isles Beach, Florida.
The developers purchased the 37,000 sq ft site at 17141 Collins Avenue in September of 2013 for $30.5m, one year later securing a $167.6m construction loan from Guggenheim Partners, which the latest loan takes out. At the time, development was slated to commence in December of 2014 with a 2017 delivery date. The developers held an official groundbreaking ceremony this week and the new delivery date has been set for the Fall of 2018.
In Florida, condo buyer deposits can be used as equity towards construction financing, and most developers today require 50 percent down payments. The developers told Real Estate Capital that 45 of the property’s 68 residences have been pre-sold.
“As a company policy, we never break ground until we have sold enough units and hence enough deposits to complete the entire asset,” they stated in an email. “We never want to risk buyers’ deposits without having 100% of the financing in place.”
There has been at least $4.5bn in financing funneled into the South Florida condo market so far this cycle. For its part, Canyon has committed $440m in condo loans. The new loan marks the firm’s second deal with PMG, having last year provided a $124m construction loan for the Echo Brickell project, another luxury condominium.
The previous South Florida cycle saw $11bn in financing, signaling there could be plenty more to come as more and more projects come up.
As of last month, there were 355 condominium towers set to reshape the Miami-Dade, Broward and Palm Beach counties, according to market intelligence firm Condo Vultures; 31 are complete, and the rest are being planned or coming out of the ground.
Muse’s 68 residences include two- to five-bedroom units, starting at 2,360 sq ft.