Mixed-Use Development Amid Coronavirus: Case Study
- Aug 05, 2020
Although Rieber Developments started working on its 12|12 Aventura mixed-use project in January—well before COVID-19 caused chaos in the construction industry—the developer said the pandemic still caused quite a jolt.
“We were definitely caught by surprise,” said Bernardo Rieber, the firm’s president & CEO. “In the beginning, we had no clue what to do. Our first thought was just to move forward and not lose time in construction, while we evaluated. And that’s what we did.”
The project—a 10-story complex consisting of 25,000 square feet of office condominiums, a 30,000-square-foot gourmet marketplace and food hall, and 160 independent- and assisted-living units—already had construction financing in place and 40 percent of its office condominiums presold. “At that point, we couldn’t stop,” Rieber said. “I had paid $20 million for the land. I had a loan, and I just had to continue and try not to lose one day.”
Rieber said Miami-Dade County stopped inspections, which could have prevented the project from moving forward, but since he was working on the building’s piles at the time, no inspections were necessary at that stage. The project was delayed, however, when the general contractor shut down due to a possible case of COVID-19 on-site.
“It was terrifying,” said Rieber. “The construction company said no one was working until the worker got tested—and tests were very slow then. We also stopped sales. You count on presales to move forward, so it was very stressful when you’re spending money and don’t have more money coming in.”
Rieber is now tweaking the design of 12|12 Aventura to reflect changes due to COVID-19. He plans to introduce new technology, such as touchless elevators and doors. He’s designing more privacy and separation in the restaurant area and moving tables farther apart. And he’s looking into improving the air conditioning systems to provide more protection against viruses.
Although 12|12 Aventura faced little impact from COVID-19, a nearby underway project and sister development, Ivory 214, suffered a three-month delay when the county stopped conducting inspections or reviewing plan revisions. Ivory 214 is a mixed-use project that includes a medical and professional building and a Tapestry Collection by Hilton hotel.
Work on the hotel’s interior was also delayed by social distancing requirements. “You couldn’t have that many people working at the same time,” Rieber said. “We also had to limit use of the construction elevator to four people at a time, so that caused delays on-site.”
As a result, the hotel, originally scheduled for delivery in June 2020, will now be completed in September. Rieber said the additional carrying costs for the three-month delay will add about 5 percent to the project cost.