Opened in 1965, Bal Harbour Shops is adding more than 300,000 square feet that will include the first Barneys New York in the southeastern U.S,
Raul C. Pedroso
The Bal Harbour Shops’ expansion is getting a significant cash infusion. On Monday, HFF announced it arranged a $550 million construction loan to a new shell company owned by the Whitman Family, developers of the iconic luxury open-air mall where Saks Fifth Avenue and Neiman Marcus first planted flags in South Florida.
Soon, those two retail giants will be joined by the first Barneys New York in the southeastern U.S. that is part of Bal Harbour Shops’ ambitious 340,000-square-foot expansion.
Chris Drew, a senior managing director with HFF’s capital markets team, said Bal Harbour Shops has maintained its position as one of Florida’s most successful shopping destinations at a time traditional retail centers across the U.S. are losing retailers and big box tenants.
“The loan marks the official launch of the Bal Harbour Shops expansion and represents the growth and strength of Miami’s retail real estate market,” Drew said. “The Shops continues to experience intense demand from both existing tenants and retailers that have been waiting years to join its roster.”
The 463,114-square-foot Bal Harbour Shops has operated at 100% occupancy for several decades with a waiting list. In addition to the anchor tenants, the Shops is home to more than 100 global, high-fashion boutiques and brands, including Chanel, Gucci, Van Cleef & Arpels, Tiffany & Co., Salvatore Ferragamo and Valentino. However, after decades of owning the luxury retail landscape, Bal Harbour Shops is facing formidable competition from Aventura Mall and the Miami Design District, two retail centers where some of the same luxury tenants have opened stores in recent years.
Whitman Family Development transferred ownership of the mall to Bal Harbour Shops LLC from Bal Harbour Shops LLLP to secure the loan. Lender Metlife Investment Management provided $150 million at eight-year, fixed rate and $400 million at a floating rate. The proceeds will be used to retire existing dept and finance the expansion which entails a three-story promenade that will connect to a 57,414-square-foot space housing Barneys. The new promenade will also be home to 70 new boutiques.
In addition, The shops will get a new grand entrance at the northeast quadrant of the property and expand Neiman Marcus by 20,000 square feet.
Matthew Whitman Lazenby, President and Chief Executive Officer of Whitman Family Development said Metlife understood the significance of Bal Harbour Shops as one of South Florida’s timeless properties. “It was important to us that we have an enduring relationship with a lender that understood, at an emotional level, the significance of Bal Harbour Shops to its tenants and customers,” he said.
Opened in 1965 by family patriarch Stanley Whitman, Bal Harbour Shops is located on 17.42 acres in the exclusive oceanfront village that has experienced a construction boom in recent years with the additions of The Ritz-Carlton, Bal Harbour, The Four Seasons at The Surf Club and Oceana Bal Harbour.