Hines Lands $220M To Build Fort Lauderdale’s First New Office Since 2021
A joint venture led by Hines secured a $220M loan to build a mixed-use project that will include the only office space under development in Fort Lauderdale.
The mortgage from Arkansas-based Bank OZK will finance the first phase of FAT Village, a 5.6-acre development in Flagler Village. The project from Houston-based Hines and Urban Street Development will include a 180K SF office building, which is set to begin construction without a publicly announced tenant, as well as 601 apartments and more than 70K SF of retail space.
FAT Village, named with an acronym for food, art and technology, will span four blocks in the neighborhood north of downtown Fort Lauderdale that over the last decade has seen a series of multifamily developments rising to replace low-density warehouses and commercial buildings.
The six-story office building will be built with Hines’ heavy timber construction called T3, or Timber, Transit and Technology, according to a statement.
Apartments at FAT Village will be spread across two buildings, a 24-story tower with 355 luxury units and a 13-story property with 249 apartments priced around $500 per month cheaper than their upmarket neighbors, Alan Kennedy, a managing director at Hines, told the South Florida Business Journal.
Retail space will line the ground floors of both the apartment and office buildings. In all, the first phase of FAT Village will total 835K SF along North Andrews Avenue between Northwest Fifth and Sixth streets.
“At a time when financing and construction starts have materially slowed, it’s gratifying to be in a position to move forward on FAT Village, which we believe will be a transformational development for Flagler Village and Fort Lauderdale,” Kennedy said in a statement to Bisnow.
Site work to demolish warehouses on the site and install sewer infrastructure began in September, and the developers are aiming to finish construction in 18 to 22 months, Urban Street CEO Tim Petrillo told the SFBJ.
Urban Street, led by Petrillo and Alan Hooper, spent around $20M to assemble the site between 2017 and 2020, according to SFBJ. Hines paid the Fort Lauderdale-based developer $57M for the site in October 2021, property records indicate, and entered into a joint venture on its development.
Hines is among the largest investment and development firms in the country, with $95B in assets under management across 383 cities in 30 countries, according to its website. Urban Street’s $750M portfolio in Florida includes multifamily, hotel, office, retail and self-storage assets.
Kennedy said other investors in the FAT Village project included Chicago-based Cresset Partners, Chile-based Las Américas, Hudson Capital Group and Halmos Holdings, the family office of Fort Lauderdale-based investor and entrepreneur Steve Halmos.
Bank OZK has long been one of the most active lenders for development projects in South Florida. It provided $259M last month to Fortune International Group and Oak Capital to build the 205-unit Ritz Carlton Residences, Pompano Beach. Two months earlier, the bank loaned a combined $122M for two other condo projects, 2200 Brickell in Miami’s financial district and The Standard Residences Midtown Miami.
Most of South Florida’s current wave of development has been focused outside of Fort Lauderdale, which has no office space under construction. The last major project to come online there was in 2021, when The Main Las Olas delivered 341 apartments and 385K SF of offices. The office space reached full occupancy by the end of 2022.
Fort Lauderdale’s urban core had the highest rents and lowest vacancy for office space in Broward County at the end of the third quarter, according to CBRE. But the $48.98-per-SF asking rent for trophy assets in the central business district at the end of September was well below prices in South Florida’s other major metros.
