Whitman Family Lands $550M Financing for Miami Retail Project

HFF has arranged the loans through MetLife Investment Management. The funds will be used to expand the 463,100-square-foot Bal Harbour Shops luxury property.
Bal Harbour Shops. Image courtesy of Whitman Family Development

Big change is afoot at the world-renowned Bal Harbour Shops in Bal Harbour, Fla., now that owner Whitman Family Development has landed $550 million in financing. HFF arranged two loans on behalf of Whitman, which will utilize the funds to expand the approximately 463,100-square-foot luxury retail property.

The financing came in the form of a $400 million floating-rate construction facility, one of the largest construction loans ever to close in metropolitan Miami, and a $150 million, eight-year fixed-rate loan. HFF placed the financing with MetLife Investment Management, which was one of a bevy of lenders that took a strong interest in meeting the borrower’s needs. “The lending community was highly responsive to this opportunity. Its storied history coupled with a world-class tenant roster and unbelievably impressive historical occupancy provided lenders with great comfort over the durability of long-term cash flow from the property,” Chris Drew, senior managing director with HFF, told Commercial Property Executive.

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Located in a tony waterfront community on more than 17 acres at 9700 Collins Ave., Bal Harbour Shops opened in 1965 as the first all-luxury fashion shopping center in the U.S. Since its debut, the open-air property has consistently held the distinction of being the most profitable, high-end shopping center in the Sunshine State and one of the most successful on the international stage; even during the Great Depression, sales at the property increased annually, according to the property’s website.

The collection of stores at Bal Harbour includes such coveted high-end retailers as Chanel, Gucci, Van Cleef & Arpels, Tiffany & Co., Valentino and Neiman Marcus. The property has maintained an occupancy level of 100 percent for several decades, leaving retailers eager for a place on the tenant roster to linger on a waiting list for an opening.

Giving the people—and the retailers—what they want

Whitman has been seeking approvals for an expansion of Bal Harbour Shops for over a decade. Though today’s retail environment is turbulent for some retail property owners, Bal Harbour Shops business has never been stronger, a spokesperson for Whitman Family Development told CPE. Whitman will use proceeds from the financing to increase the size of Bal Harbour Shops with a 300,000-square-foot addition, roughly 57,400 square feet of which will be home to the only flagship Barneys New York in the southeastern U.S. The expansion project will also yield a three-story promenade connecting Barneys to the existing promenade, a new grand entrance and a 20,000-square-foot expansion of the Neiman Marcus store.

Whitman will also use a portion of the financing proceeds to repay an existing loan. HFF’s Manny de Zárraga, executive managing director, Jim Dockerty, managing director, and Matthew McCormack, director, joined Drew on the capital markets team that orchestrated the loan package. The Bal Harbour expansion project will be completed in time to welcome Barneys to the premier retail destination in 2023.