Genting Group Makes Another Purchase

Aug 31, 2011 No Comments by

The global investment group that bought the Miami Herald headquarters building and surrounding land continues to acquire parcels north of downtown Miami.

An affiliate of Malaysia-based Genting Group in the past month has assembled nearly two blocks west of Biscayne Boulevard within walking distance of the Herald property. The group paid $29.4 million for a total of 3.6 acres of mostly vacant land, according to Miami-Dade County property records.

Genting’s latest acquisition was a 17,500-square-foot parcel purchased for $1.25 million from former Sony Music executive Tommy Mottola. Genting bought the property at the northwest corner of Northeast First Avenue and 15th Street under the name of ABC Biscayne LLC, which is managed by Two Digital Threes LLC. In 2008, Genting acquired 48 percent of Two Digital, an investment holding company.

Genting’s appetite for land in Miami’s Omni area began two months after the multinational bought the 13.9-acre Herald property for $236 million.

The property includes parking lots and the building that houses the Miami Herald, which is owned by the McClatchy Co. The Genting Group, which owns 50 percent of Miami-based Norwegian Cruise Line, plans to build a destination resort on the bayfront property. The tourist and entertainment venue would have nearly 8 million square feet of space, including a hotel, convention, retail, restaurant and office space. Genting would also include a casino if the state changes its gaming laws.

Genting is one of the world’s largest operators of destination resorts. It owns dozens of casinos in the United Kingdom and last year won a license to install slot machines at Aqueduct Racetrack in New York City.

Some real estate experts speculate the new acquisitions will become home to parking garages for those visiting the entertainment venue.

The Omni area has a significant parking shortage. Venues like the Adrienne Arsht Center for the Performing Arts and American Airlines Arena were built with little or no parking. Most patrons park on surface lots scattered around the area. As those lots are developed, the parking shortage would worsen.

One of the blocks that Genting acquired is near a Metromover stop. Visitors could park and hop on the Metromover for a two-block ride to the future mixed-use complex.

Prime Redevelopment Area

In less than four months, Genting has become one of the largest land owners in the Omni area. The neighborhood, between downtown and the Design District, is prime for redevelopment. Dilapidated warehouses and vacant lots west of Biscayne Boulevard are in stark contrast to the performing arts center. After the center opened in 2006, there was some speculative buying of nearby properties. The financial crisis soon put an end to most deals.

Genting’s plan to redevelop the Herald site has not yet spurred any significant investor activity, according to Luigi Mercurio, a broker with Esslinger Wooten Maxwell in Miami Beach. He and colleague Jeff Cohen marketed the Mottola property and brokered the Aug. 17 deal. The pair also is seeking buyers for two other Omni area parcels on behalf of Mottola.

‘A Lot Of Maybes’

Mercurio said they haven’t received much interest from investors in the listings, which hit the market three months ago.

“It is strange that a foreign company that specializes in casinos makes such a big investment in an area and there seems to be a quiet environment around it,” Mercurio said.

Jeff Kluger, whose family is one of the largest Omni area property owners, said investors showed interest in the neighborhood immediately after Genting bought the Herald property. Since then, interest has almost vanished. He said that’s because Genting has yet to come with site plans and start the permitting process.

“There are a lot of maybes out there right now,” Kluger said.

So far, the Genting affiliate has assembled most of the block on the west side of Biscayne Boulevard between 15th and 16th streets and between Miami Place and First Avenue. In addition to the Mottola parcel, the Genting affiliate bought half a block from West Biscayne Holdings, led by Miami attorney Eduardo J. Garcia.

Genting paid $2.7 million for the 35,500 square feet of contiguous parcels. That deal closed Aug. 15.

Last month, the Genting affiliate bought most of a block between Biscayne Boulevard and Northeast Second Avenue and between 16th and 17th streets. The site totals 2.38 acres. It sold for $16.25 million, according to public records.

Source: DBR

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