Stalled Miami Condominium Project To Resume After New Developer Steps In

Article by Costar

Arbor Residences, a condominium project tucked away in Miami’s verdant Coconut Grove neighborhood, is set to relaunch sales in December after local real estate attorney and developer Isaac Kodsi decided to bring it back to life.

Kodsi and his company Ark Development acquired the project after the original developers were unable to complete it after encountering financial difficulties that included increased construction costs and the overall instability at the onset of the global pandemic in 2020, Kodsi told CoStar News in an interview.

Arbor Residences broke ground in 2017 and was nearly sold out in 2022 when Canadian lender Trez Capital filed a foreclosure against the project. Neither Nicolas Haman, the vice president of developer Urban Atlantic Group named in the foreclosure, nor Trez Capital immediately responded to requests for comment.

Kodsi told CoStar News that while the project stalled out because of costs, the time between restarting final construction was more akin to a “pause” of around six or seven months. The building was structurally sound, and all permits had been refiled with the appropriate authorities. Sales will be launching around the beginning of December with an expected completion date of the 45 units in the third quarter of 2024, Kodsi said.

Former buyers were fully reimbursed for their initial purchase, when units started at around $799,999 and averaged around $900,000 when it broke ground in 2017.

“I just didn’t want anyone to get hurt,” explained Kodsi, who said it was both a gesture of goodwill and the quickest, easiest method to get the stalled project off the ground rather than deal with litigation and dozens of angry buyers. “Now the project is fully mobilized,” he added.

Neighborhood Resurgence

Arbor Residences is located at 3034 Oak Ave., about five minutes from where Kodsi lives in Coconut Grove and part of the reason he was interested in picking up the project. Coconut Grove, which is located a little over 4 miles south of downtown Miami, has experienced renewed growth, seeing the redevelopment of the shopping mall CocoWalk, which anchors much of the neighborhood as well as new developments such as the Mr. C hospitality brand's hotel and sold-out residences, and the popular open-air destination Regatta on the Grove, owned and operated by Breakwater Hospitality Group.

“In the last three to five years, Coconut Grove has really had a resurgence. In light of that is why I decided to purchase the deal, take it out of its financial troubles and bring it back to life,” Kodsi said.

Kodsi's resurrection of Arbor Residences includes the original architecture and construction teams. The project was designed by locally based Behar Font Partners. Available units range from 1,450 to 3,000 square feet, with prices starting at $1.2 million. Other luxury condo projects in the area, such as the Mr. C Coconut Grove Residences, start around the "low $600,000s," according to Mr. C Coconut Grove Residences' website.

The project has been well received, and even some former buyers are "adamant" to buy back their units at current prices, Kodsi said. He told CoStar News that while he had seen some signs of a slowdown, "the demand for Florida and Miami is so high worldwide ... we're a worldwide-based market today" and noted that today's market was driven primarily by cash buyers.

The Miami Association of Realtors notes cash buyers represent just over half of all existing condo sales in Miami and reflect the region's preeminent position for foreign buyers who tend to purchase with all cash and are undeterred by rising interest rates.

Similarly, Kodsi told CoStar that moving forward, "I think this market is going to be strong, and this is the market we live in. This is our real normal. I don't think we're not in a special market here in Miami, this is our normal market now."

Barring additional unforeseen circumstances, Kodsi expects the project to progress smoothly and expects a completion around August or September next year.

For the Record

Sandra Masis of Cervera Real Estate is leading sales for Arbor Residences