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THesis Miami Raises $33M From Retail Investors With Plan to Tokenize

Nolan Reynolds International (NRI) has recapitalized THesis Miami, a mixed-use property in Coral Gables, that opened last fall, with $32.7 million from retail investors, in a bid to become the first property in Miami to be tokenized.

Pending approval, retail investors will be able to trade shares in the property, backed by a cryptocurrency issued by NRI after a six-month lockup period.

The equity, raised through the CrowdStreet platform, is part of a broader recapitalization for the property, which includes a total of $150 million in debt from Starwood Property Trust and around $95 million in equity.

THesis, located at 1340 S Dixie Hwy, includes residential, hotel and retail components across its 777,000 square feet. The Residences at THesis, the 204-unit residential portion, is 99 percent leased, while the 295-key THesis Miami Hotel and retail portions are on the path to stabilization, according to the CrowdStreet offering.

NRI plans to tokenize the property, allowing retail investors to trade shares backed by digital coins throughout the investment’s lifetime, thus introducing liquidity into real estate, a traditionally illiquid vehicle. If everything goes according to plan, NRI will register its operating partnership as a real estate investment trust, and, after a six-month lockup, existing investors can exchange their traditional shares for digital shares — represented by a digital coin — in the real estate investment trust.

Approximately 700 investors participated in the offering, which started at a minimum of $25,000, offering a greater shot at liquidity should the secondary market become possible. For those who choose the traditional setup, the investment period is expected to be five years.

While NRI has structured the investment to allow for tokenization through the REIT, it has yet to be approved by the Securities and Exchange Commission

Starwood Property Trust provided the $150 million in debt, while NRI contributed $17 million in equity. The remaining equity in the capital stack will be raised from private placement, according to the offering.

 

Source:  Commercial Observer

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With JPMorgan And Goldman Sachs, Miami Could Become ‘Wall Street South’

Elon Musk just moved to Texas, but guess who’s (reportedly) moving to South Florida? Jared Kushner, Ivanka Trump, Tom Brady, Gisele Bundchen and the asset management division of Goldman Sachs. Those are the boldface names announced in news reports last week alone.

The New York Post recently reported that JPMorgan Chase CEO Jamie Dimon is open to moving his bank to Florida, too, a move he formerly resisted because he said the schools weren’t good enough.

Miami has been dubbed “Wall Street South” since at least 1990.

In the past year or three, the migration of high-profile business to Miami, and to Florida more broadly, has gained steam. There’s no income tax and the politics are perceived as business-friendly. But the state struggles to fund education, environmental protections and mass transit. There’s also climate change, sea-level rise and saltwater intrusion to consider.

Starwood Property Trust is building a new headquarters at 2340 Collins Ave. in Miami Beach and CEO Barry Sternlicht settled in as a city resident in 2018. Billionaire investor Carl Icahn this summer moved Icahn Enterprises from New York City to the Milton Tower, located at 16690 Collins Ave. in Sunny Isles Beach, just north of Miami Beach. Chicago’s Ken Griffin just dropped $37M for property on exclusive Star Island and there are rumors that his firm, Citadel, will relocate nearby.

By publicly bragging about leaving “dead” New York for Miami, entrepreneur James Altucher sparked a fight over the Big Apple that put Jerry Seinfeld on the defensive. Miami is also becoming a hub for Black startup entrepreneurs: tech investor and Founders Fund partner Keith Rabois recently said he would move to Miami, with the fund opening a small office there.

Further north, hedge funds have been migrating to Palm Beach County. Tennis superstar Serena Williams has lived in Palm Beach Gardens for years, and her husband, Reddit co-founder Alexis Ohanian Sr., recently bragged on Twitter that people were following him.

Further upstate, Fisher Investments opened an office in Tampa, a city that billionaire Jeff Vinik has been championing for years. He’s building a massive development there with Bill Gates’ Cascade Investments.

According to Bloomberg, 20 bankers with Moelis & Co. told boss Ken Moelis they wanted to move to Florida, and he is allowing it. Moelis & Co. is saving about $30M a year since the company pivoted to Zoom meetings over in-person ones during the coronavirus pandemic.

Business development groups like the Downtown Development Authority and Beacon Council in Miami and the Business Development Board of Palm Beach County have helped grease such moves by identifying and bundling incentives.

There’s one billionaire, however, willing to put the kibosh on the hype: real estate investor Jeff Greene.

“This whole idea that financial services, like hedge funds, are going to be this huge jobs creator is ridiculous,” Greene told the Palm Beach Post. “You’ve got hedge funds that come down with six people and they make a big deal that we need all these office towers for them, and we don’t.”

For instance, Miami Beach recently called for office developers to put new Class-A buildings on city-owned surface parking lots. This angered some residents who feel that the city caters to wealthy developers and newcomers while ignoring the needs of the middle class.

Greene has tempered real estate hype in the past. Speaking on a Bisnow panel in 2018, Greene cautioned that low interest rates and an abundance of capital were leading to overbuilding, while Florida workers were largely low-paid.

Greene told the Post last week that Goldman Sachs CEO David Solomon told him the company may move outside of New York, but no location is decided.

“I think some will come down here, they will try it out, move a few people and see if more people come, but I think the idea that every hedge fund is leaving New York City and moving to Palm Beach is just silly,” Greene said. “We will always be a service economy and there is nothing wrong with that.”

 

Source:  Bisnow

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