Kushner Launching First Miami Project: A $550M Apartment Complex
The Kushner Cos. is launching a major apartment project in Miami, Bisnow has learned, the first in Florida for the third-generation real estate business.
Kushner Cos., the business now led by the brain trust of Charles Kushner, Nicole Kushner Meyer and Laurent Morali, is planning on breaking ground later this year on an 1,100-unit apartment project in Miami's Edgewater neighborhood, sources familiar with the deal told Bisnow.
The three-phase apartment complex will be the first South Florida project in Kushner history, according to the sources, who were not authorized to speak publicly about the deal. The first phase will comprise roughly 400 units, and Kushner plans to break ground on the site at 2000 Biscayne Blvd. in the third quarter.
Kushner isn't working with a local partner on the deal, sources said, and plans to finance the project through one of its existing banking relationships. Since Charles' eldest son and onetime CEO Jared Kushner entered politics, those relationships have come under scrutiny, including deals with Citigroup that closed after bank executives met with him in the White House.
Officials with Kushner Cos. declined to comment.
The heightened scrutiny has led to a smaller pool of potential partners. Kushner executives told The Wall Street Journal last month that they are no longer pursuing financing from sovereign wealth funds or through the EB-5 program. The company's previous attempts to finance business through these avenues — a common occurrence for many real estate companies — have drawn public questions about national security and conflicts of interest since Jared Kushner was named senior adviser to President Donald Trump, his father-in-law.
The vacant site at 2000 Biscayne Blvd. is currently owned by Miami developer Enrique Manhard, who paid $13.1M to acquire it in November, according to property records. Kushner is under contract to develop the 32K SF site, according to sources, and Manhard also controls neighboring sites that will likely come into play for the second and third phases of the project.
The sites fall within an opportunity zone. It is unclear if or how Kushner would take advantage of the program, which allows investors to defer taxes on capital gains by investing them into properties and businesses in designated census tracts.
In the last two years, Kushner Cos. has refocused its company strategy on acquiring its historic bread and butter: suburban apartments. Last month, it paid $1.1B to acquire more than 6,000 apartments in Maryland and Virginia, its biggest deal in more than a decade.
Morali told the Journal the company has 6,000 more units in its acquisition pipeline and 22,000 under ownership. But the Miami project is the most ambitious development the company has undertaken since it redeveloped a large swath of properties in Brooklyn into creative office space.
Outside of Miami, Kushner is planning on building 5,000 more apartments, largely in the New York Tri-State area, sources said, but it is unclear where or when those apartments will be constructed.
While Kushner's ties run deep in New York and New Jersey — where Joseph Kushner, Charles' father, founded the company after surviving the Holocaust and emigrating from Europe — the company is planning on building out its Miami team, sources said. Kushner is focused on acquiring more properties and hiring locally, the sources said, but a timeline and headcount on those goals remain unclear.
Kushner is not alone among major national players who are eyeing South Florida as a rental development hot spot. Mill Creek Residential Trust and Greystar are co-developing a project in Fort Lauderdale, The Real Deal reports, and 51,000 rental units were proposed, planned or under construction in the region as of December.
UPDATE, 4:55 P.M. ET: This story has been updated with additional information.