ArborCrowd Deal Allows Investors to Get in on the Ground Floor of Miami’s Burgeoning Suburbs

Biscayne 112 is Poised to Benefit from Miami’s Expanding Population, Diversified Employment Base

Targeting 16% to 19% Internal Rate of Return Over a Three- to Five-Year Hold Period

NEW YORK--()--ArborCrowd, the first crowdfunding platform launched by a real estate institution, announced a new offering today that allows investors to acquire equity interests in Biscayne 112, a Class-A, ground-up development located at 11200 Biscayne Boulevard in North Miami, Fla. The offering presents an opportunity for investors to get in on the ground floor of Miami’s blossoming suburbs, which continue to evolve as high prices in Downtown Miami are pushing renters farther from the city center.

An affiliate of Arbor Management Acquisition Company LLC (“AMAC”) is the project’s sponsor, and — along with ArborCrowd — is a member of The Arbor Family of Companies. Affiliates of the sponsor have funded more than 85 percent of the total equity of the deal. ArborCrowd now seeks to raise $5.15 million from investors for the remaining equity, which has been prefunded into the project by an affiliate of ArborCrowd. The sponsor broke ground on the $103.8 million development in April, and construction is expected to wrap up towards the end of 2020. The transaction, which is ArborCrowd’s first ground-up construction investment opportunity, was particularly attractive considering the following:

  • Amid rising costs associated with living in Downtown Miami, there is strong demand for luxury rentals at discounted rents within a short commute to the Downtown area.
  • The land on which Biscayne 112 will be built is one of the few vacant parcels in the North Miami area that can accommodate a development of this size; and
  • The project’s cost basis is projected to be lower per unit than similar asset trades and recently developed multifamily properties within a 15-mile radius.

“North Miami is an attractive place to live as it is a short commute to Downtown Miami, is in a school district with multiple top schools, and is seeing a surge of investment into the community. However, it is notably lacking in vacant multi-acre development parcels, which makes a project like ours both scarce and highly desirable,” said ArborCrowd Co-Founder and COO Adam Kaufman. “Biscayne 112 is one of the only large-scale, multifamily developments under construction in the area, which provides a competitive advantage as the sponsor seeks to capitalize on strong renter demand for luxury product while offering an expected 20 to 30 percent discount to rents in Downtown Miami.”

Mr. Kaufman added, “This investment is indicative of the high level of institutional-quality deals that ArborCrowd can bring to individual investors by partnering with high-caliber sponsors with strong track records — such as AMAC. Investors have come to understand that we thoroughly underwrite our transactions because an ArborCrowd affiliate prefunds the investment before offering it to the crowd. Very few crowdfunding companies, if any, could say the same.”

Once complete, the 402-apartment Biscayne 112 will comprise a variety of one-, two- and three-bedroom units across eight stories as well as nearly 40,000 square feet of amenity space, including a state-of-the-art fitness center, an entertainment room, a lounge, two swimming pools, zen gardens and a dog park. The property is optimally located in North Miami, a thriving suburb of Miami that sits approximately 20 minutes from Downtown Miami, and is on Biscayne Boulevard — one of the city’s main thoroughfares. The location offers ease of access to nearby shopping, entertainment and employment centers, as well as hotspots on the city’s famed Collins Avenue.

The North Miami submarket has seen a population surge in recent years that has led to an uptick in construction and redevelopment to meet increasing demand for quality housing. According to real estate data firm ESRI, there was a 10.24 percent population increase in the one-mile radius surrounding Biscayne 112 from 2010 to 2018, with another 5.91 percent increase projected by 2023. This continued growth has spurred an increase in the number of high-quality commercial tenants seeking to locate in the area, including Whole Foods Market, which opened in 2013, and the University of Miami Health System, the latter of which is building a new, 225,000-square-foot medical center in North Miami.

The Miami Fort-Lauderdale-West Palm Beach Metropolitan Statistical Area (“Miami MSA”) is the seventh most populous in the U.S. and has an unemployment rate approximately 10 percent lower than the national rate, having added roughly 575,000 net new jobs to its workforce since June 2009, according to the U.S. Department of Labor. The Miami MSA’s diversified employment base is comprised of a wide range of industries including trade, transportation and utilities; professional and business services; education and healthcare; and leisure and hospitality, which can help protect the region against the effects a market downturn would have on strictly tourism-dependent markets. As the proverbial gateway between the U.S. and Latin America, the city is home to several Fortune 500 companies, and more than 1,400 multinational corporations have regional headquarters or satellite offices there, including Canon Latin America, Hilton International, Novartis Pharmaceuticals Corp., Visa International and World Fuel Services.

Biscayne 112 is ArborCrowd’s ninth offering since its inception. ArborCrowd’s offerings tend to subscribe quickly, reflecting substantial investor demand. In total, ArborCrowd has raised nearly $25 million of equity for assets with a total capitalization of roughly $270 million. To date, ArborCrowd has returned almost $6 million to investors.

To learn more about Biscayne 112 and access the offering overview and private placement memorandum, which includes market reports, property details, risks, financial pro formas and more, please visit www.arborcrowd.com/offerings.

About ArborCrowd

ArborCrowd is the first real estate crowdfunding platform launched by a real estate institution, opening up an exclusive network to a new class of investors. As part of The Arbor Family of Companies, which includes Arbor Realty Trust (NYSE: ABR), a leading publicly traded commercial mortgage real estate investment trust, ArborCrowd is backed by more than 30 years of leadership experience. ArborCrowd reviews more than 500 deals a year from its proprietary network and only chooses the ones that survive its rigorous underwriting process. ArborCrowd prefunds capital to a deal prior to launching the offering to investors. This ensures the deal closes and allows ArborCrowd to offer investors accurate and detailed information about the property. Additionally, ArborCrowd chooses to present one deal at a time, so there is no guessing what property investors will actually own.

Contacts

Megan Kivlehan – 646-677-1807
ArborCrowd@icrinc.com

Contacts

Megan Kivlehan – 646-677-1807
ArborCrowd@icrinc.com