MCZ/Centrum Grabs Flamingo South Beach Tower for $163.5M February 21, 2006 By Hortense Leon, Southeast Correspondent In what may become one of the largest condominium conversion transactions in Florida, MCZ/Centrum Developers has purchased the first of three towers in the 1,688-unit rental complex known as Flamingo condominium South Beach on Miami Beach for $163.5 million. The seller of the luxury complex was Denver-based AIMCO Properties L.P. But if MCZ/Centrum exercises its options to buy all three towers, the total price tag will be $600 million. In exchange for an option payment of $5 million, MCZ/Centrum will be able to purchase the remaining towers at the Flamingo condominium plus common areas for $436.5 million. The 614-unit north tower will go for $169 million and the 513-unit center tower will cost $267.5 million. AIMCO will gain a $19.8 million profit from the sale of the units after certain development fees and certain returns on buyer's equity have been achieved, according to an 8-K SEC filing. The sale of the Flamingo condominium comes at a time when Miami's red hot residential real estate market has begun to cool, according to recent reports. But Michael Lerner, president of MCZ/Centrum Developers, disagrees. "We think the market is still very strong," he told CPN this afternoon. "Properties on the water (the complex is on Biscayne Bay) are doing great." Lerner said that his company was buying the Flamingo condominium in stages, because it is so large, not because of any cautionary strategy. He said that he didn't yet have a price schedule for the converted units. But Evan Kristol, vice president-investments at Marcus & Millichap in Fort Lauderdale, said that condominiums on South Beach have been trading for $500 to $600 per square foot. "We will go to market (with Flamingo condominium South Beach units) in March," Lerner said, noting that he will do substantial renovations in common areas, although he did not put a price tag on those renovations. The apartments themselves were recently renovated, so MCZ/Centrum Developers won't be doing any more work on them, he added. Grand Flamingo of South Beach, The Largest Condo Conversion Ever in the State of FloridaMiami Beach February 2006 - Apartment Investment and Management Company ("Aimco") (NYSE:AIV) announced today that the company has entered into a purchase and sale agreement with MCZ/Centrum Florida XVI, LLC to sell a portion of the Flamingo condominium South Beach property known as the South Tower. The South Tower sale price is $163.5 million and includes 562 residential units and Aimco's rights to the property's marina. Aimco owns 99.1% of the Flamingo condominium South Beach property. The agreement also provides the buyer with the option to purchase the North and Central Towers at later dates.The buyer paid $5 million to Aimco, non-refundable, for the option to purchase the 614-unit North Tower for $169 million between September 1, 2006 and February 28, 2007, and the option to purchase the 513-unit Central Tower, along with the remainder of improvements on the property, for $267.5 million between December 1, 2007 and May 31, 2008. The buyer may extend these periods under certain conditions."Flamingo condominium South Beach is an extraordinary property. We are pleased to close this transaction. By converting the property to for-sale use, Aimco achieves an excellent return on its investment," comments Harry Alcock, Aimco's chief investment officer.The agreement also provides Aimco with a profit participation if certain thresholds are met. Aimco will receive the first $19.8 million in proceeds in the proposed condominium conversion after certain development fees and certain returns on the buyer's equity have been achieved, plus 20% of the buyer's net profits thereafter. The agreement also provides Aimco with $600 per unit per year for the use of the health club, if and when each tower is sold. Aimco will continue to operate the South Tower for up to one month and will continue to operate the remainder of the property if and until the subsequent options are exercised.Due to the staggered timing of the proposed sale of all three towers and improvements, Aimco projects the effect of the sale of the South Tower on 2006 FFO to be a benefit of approximately $0.02 per share, assuming net proceeds are used to pay down corporate debt. Existing debt on the South Tower was $76 million.Aimco is a real estate investment trust headquartered in Denver, Colorado that owns and operates a geographically diversified portfolio of apartment communities through 21 regional operating centers. Aimco, through its subsidiaries, operates 1,370 properties, including approximately 240,000 apartment units, and serves approximately one million residents each year. Aimco's properties are located in 47 states, the District of Columbia and Puerto Rico. Aimco common shares are included in the S&P 500.Experience true luxury living high above Biscayne Bay at South Beach's hottest high-end high-rise. You can take in the sun-kissed views of Biscayne Bay by day, and starry lights and tropical rhythms of South Beach at night. Enjoy the greenery surrounded by the bay of this extraordinary location. The Flamingo has something for everyone!Venture out on a stroll to Lincoln Road or Ocean Drive and catch the exciting landscape of people and hot-spots. If you are in a stay-at-home mood, relax by the pools overlooking the bay, dotted with boats and marine life. Take your pet for a walk on the bayside promenade and visit the doggie park for that special pooch in your life. Wake-up the day with a vigorous workout at our 14,000 square foot state-of-the art Athletic Club.The Flamingo's tastefully designed and spacious apartment homes feature many amenity upgrades and distinctive floor plans.Begin your day with unforgettable sunrises and end it with breathtaking sunsets.Living at Flamingo South Beach is like being on vacation every day!
THE FLAMINGO WILL BE TAKING RESERVATIONS FOR ONLY A COUPLE MORE DAYS. THE DEMAND FOR THIS PROJECT IS VERY HIGH...THIS IS THE LAST CONDO CONVERSION ON THE BAY OF SOUTH BEACH. CALL SOUTHBEACHCONDO.COM (786)999-9740 FOR MORE UP TO DATE INFORMATION.
http://www.southbeachcondo.comMATT JOSEPH
786-999-9739
WWW.SOUTHBEACHCONDO.COM
