MIAMI—In one of the biggest-ever deals in South Florida, Miami Beach-based Terranova sold its six-building portfolio of assets on and around Lincoln Road to Morgan Stanley Real Estate Investing, along with affiliates of Terranova, for $342 million. Terranova assembled the assets over the past three and a half years for $191 million.
As Terranova chairman Stephen H. Bittel sees it, the deal is one of the most exciting his firm has closed in its 35-year history. He views the transaction as a partnership with other owners on the famed street—and the City of Miami Beach—to move Lincoln Road forward.
“Our investment with Acadia Opportunity Funds has drawn more and more attention of professional capital to the street,” Bittel says. “At the same time, the interest from top international retailers has pushed sales and rents higher and higher.”
Bittel calls the planned redesign of the Lincoln Road common areas and the redevelopment of the Miami Beach Convention Center “strong positive influences that will keep the momentum moving forward." Meanwhile, he expects the new partnership with Morgan to seek additional market opportunities for these types of assets, which he described as having “enduring generational value.”
“This long-term investment strategy focused on high street retail properties reflects the continuing trend of residents and tourists alike to be drawn to the top urban shopping streets, of which Lincoln Road is the absolute best, south of Madison Avenue in New York City,” Bittel says. Two of the retail properties have already received Historic Preservation Board approval for expansions, making it possible to accommodate new flagship retailer opportunities. And a proposed development on Lincoln Lane would create a three-level building.
Lincoln Road has become home to international retailers such as Armani, H&M, Zara, John Varvatos, Zadig and Voltaire, Anthropologie, and Apple. On the dining front, Lincoln Road is home to Sushi Samba, Khong River House, Laduree, Meat Market, Sosta, and Havana 1957. Lincoln Road attracts local and tourists.
“Miami Beach has had a magnetic attraction from around the world almost since developer/creator Carl Fisher's dreams started to become reality,” Bittel says. “With a storied past to build upon, we look forward to an exceptional future of growing asset values, as we work closely with the community to make Lincoln Road better and better for both residents and visitors."
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