Aventura developer secures

$106 million construction loan

by Paola l uspa-Abbott

piuspa@alm.com

The Echo Aventura condo developer secured a $106 million construction loan
to build the project, which is nearly 60
percent pre–sold.
The size of tl1e loan makes it a rarity when most traditional banks are reluc­ tant to lend large sums to for condomin­
ium construction. The loan came from New York–based NorthStar Real Estate Income Trust, a real estate invesn11ent trust
The developer is a joint venture be­
tween the Property MarketGroup and JDS Development Group in New York. Mission Capital Advisors in New York arranged the financing, which is about
50 percent of the project's construction cost, company managing director Jason
Cohen said.
The deal for the $200 million con­
do high–rise at 3250 NE l88tl1 St. in
Aventura closed July 28, but the mort­
gage has yet to be reoorded. like most condo project.
oper icollecting 20 percent of the pur­
chase price when purchase contract are signed, 20 percent at ground–breaking and 20 percent at tl1e building's top–off. So far, the developer has collected 40 percent, but the lender went allead and considered tl1e 60 percent to be on hand when making tl1e loan, Cohen said.
"Part of tl1e deal is tl1at we were able
to get the lender to recognize the last 20 percent deposits even tl1ough we hadn't received it,"he said."They gave us credit

for deposits we are going to be getting in tl1e future."
A traditional bank would give credit
only for deposits on hand, Cohen said.
By law, developers can use 90 percent
of the depositto help pay for the con­
struction.
Between the deposits and tl1e loan, tl1e developer will have only 5 percent
cash equity in tl1e project, Cohen said.
'l11at percentage contrastsharply vith
traditional banks, which want to see
developers have signifir.ant skin in the
game before lending money.
"Banks are looking for the sponsor to
have a larger vested interest in tl1e deal equity vise;Cohen said.
Many nonbank lenders limit loans to
50 percent of the building cost, he said.
·n1e loan appears to be the sec­ ond largest condo construction loan in South Florida since the housing crash. Mansions of Acqualina in Sunny Isles Beach secured a $160 million construc­ tion loan earlier thiyear.The project is being built by an affiliate of the Trwnp Group led by Williams Island developers Eddie and JulesTrump.

Paola luspa–Abbottcan be reached at

(305) 347-6657.