Restoration Hardware in talks to lease Design District building for flagship store, owner says
Updated, March 23, 3:55 p.m.: Restoration Hardware is in talks to lease a new Miami Design District building for its flagship store, The Real Deal has learned.
The home-furnishings company, along with Waterworks, would take the entire 14,000-square-foot, three-story building at 4136 North Miami Avenue, MV Group CEO Manny Varas, part of the property’s ownership group, told TRD. He expects to complete the building by the end of March.
Restoration Hardware could not be reached for comment. The furniture store company has an outlet at the Shops at Sunset Place, as well as a showroom at Aventura Mall. It shuttered its store at the Falls in recent years.
Asking rent is $75 per square foot, triple net for the ground floor and $60 per square foot on the second and third floors Varas said. Restoration Hardware is in talks to lease at $60 per square foot blended for all three floors, plus the 8,000-square-foot rooftop. “We’re basically looking at $750,000 annual triple net for the entire building, including the rooftop area and underground parking garage, which is about 26 spaces,” Varas said.
Tony Arellano of Metro 1 Commercial, who is listing the property for sale at $15.5 million, disputed that Restoration Hardware was in talks with Varas to lease it, and said the furniture company has never visited the property. Varas said he’s dealing directly with the company.
Commercial broker Lyle Chariff, who’s active in the Design District, said Restoration Hardware has been looking for a space in the district “for a long time, but they basically were very rent sensitive. They weren’t willing to pay the very high rates that were being asked in the Design District,” said Chariff, president of Chariff Realty Group, adding that the company has been looking for an owner that would get a 7 percent return on the property instead.
Istituto Marangoni, a Milan-based fashion school, was interested in leasing the building but was looking for a bigger space, Varas said. Marangoni instead signed a long-term lease nearby at 3701 Northeast Second Avenue, which is valued at $13.5 million. Arellano brokered that lease.
Varas said he bought the 9,400-square-foot property at 4136 North Miami Avenue with investors in 1999 for $500,000. The $6 million project was partially financed with a $3.5 million construction loan from Stonegate Bank, negotiated by Vice President Juan Carlos Deona.
MV Group broke ground on the building in August 2015, one of the only Mediterranean-style buildings to be developed in the otherwise modern-style Design District in recent years.
The Design District — broadly defined as the area from Biscayne Boulevard to North Miami Avenue, and from the north side of 36th Street to 42nd Street, with the center the Paseo Ponti and First Avenue — is the subject of a multimillion-square-foot revamp that will ultimately include 120 stores and at least 15 eateries in the neighborhood by the end of 2018, said Craig Robins, president and CEO of Dacra, in The Real Deal’s March issue. Current tenants include Hermes, Tiffany & Co., Louis Vuitton and Dior.
If Restoration Hardware signs the lease, the store could open in time for Art Basel this year, Varas said.
Source: The Real Deal