A contemporary art fair and visionary developers have reinvented South Florida as a place where art, commerce and habitation come together.
IMAGINE THAT IT IS early December and you are an art lover living in a cold, dark climate. Much of the world is awaiting the upcoming holiday season, yet nothing is happening in the global art markets.
In Miami Beach, however, the weather is sunny, dry and warm and the city is hosting Art Basel, one of the world’s largest art and design events.
Since 2002, Art Basel has been held in early December in Miami Beach. This premier art fair, which is staged annually in just three locations around the world — Basel, Switzerland, Miami Beach and Hong Kong — brings together principal galleries and collectors from around the globe to view, appreciate, revel in and, ultimately, buy and sell modern and contemporary art. In 2014, this single event drew over 75,000 visitors to Miami Beach.
Over the years, the success of Art Basel has spawned 15 separate satellite art fairs layered over Miami Beach, the Miami Design District, and the Wynwood neighborhood in Midtown Miami. These activities attract an additional 25,000 to 30,000 people each year. The result: more than 100,000 art tourists descending upon South Florida for an intensive art immersion.
Miami’s real estate markets have responded to this culture crush by filling demand for pop-up showrooms and gallery space. Temporarily converting warehouses and vacant stores in gentrifying areas such as Wynwood, Little Haiti and Midtown into galleries to accommodate dealers and exhibitors during the week of Art Basel has proven more profitable than renting to the users for which they were intended.
Before Art Basel arrived, Miami was already a leading art center. Many noted collectors had acquired warehouses that they were using as galleries to showcase their extensive collections, or had donated collections to the city’s public museums. Given its gateway location and its reputation as the “business capital of Latin America,” Miami has long been a center of art and design. With Art Basel’s arrival, the marketplace evolved, reinventing itself not only as an art venue but, over time, as a place where art, commerce and habitation have merged.
In December 2014, Art Basel in Miami Beach attracted an audience of 73,000 over five days and featured a wide variety of artworks as well as dance performances and film showings. Some films were projected onto a 7,000-square-foot wall at the Frank Gehry-designed New World Symphony building.
Examples of this fusion include striking civic buildings and even parking garages designed by well-known architects as well as the redevelopment of the Miami Design District and the Wynwood neighborhood.
“Starchitects” and Branding
Local and regional emphasis on architecture and design has grown significantly since the commencement of Art Basel. Civic leaders have embraced design and architecture as tools of revitalization and placemaking. For example, the Adrienne Arsht Center for the Performing Arts of Miami-Dade County, which opened in 2006, is a $460 million multitheater setting for opera, symphony, dance and Broadway companies as well as a modern masterpiece designed by Cesar Pelli.
Across Biscayne Bay, the city of Miami Beach’s New World Symphony, America’s orchestral training academy, retained Guggenheim Museum Bilbao architect Frank Gehry to create a new $100 million performance center, the New World Center, which opened in 2011. Designs by Pelli, Gehry and other star architects, or “starchitects,” are branding Miami and Miami Beach as a market that embraces and seeks excellence in the design of all types of places and products.
In fact, the city of Miami Beach now holds international design competitions to select the most innovative concepts for municipal parking garages.
The current cycle of nearly 110 new condo towers under construction and the additional 221 condo towers in the planning and presale stages in the Miami area are all, in large and small ways, embracing design, art and architecture as themes to sell residences to well-heeled Art Basel patrons and others. Office and retail developers are also joining the fray by increasingly seeking to brand their properties with star architects’ names, presenting their buildings as works of art within which people can work or shop. These new developments are yet another growing legacy that is being nurtured and encouraged by Art Basel.
Developer Craig Robins, president and CEO of the real estate development company Dacra, is the best-known retail and office developer focused on creating value and market impact through art and design in the Miami area. Robins has long invested in and with leading designers and has used design to leverage branding, marketing and value creation. Beginning in the early 1990s, Robins attracted fashion designer Gianni Versace to open a retail store in Miami Beach’s emerging South Beach market. The project was a smash hit for Robins and launched Dacra as a firm that understood how bringing unique tenants to unique places could unlock the potential of those places to create value.
The Miami Design District
Perhaps the largest transformation of a neighborhood by art, design and architecture is the Miami Design District. In the mid-1980s, the city of Miami retained Maxwell + Partners LLC to create a transition plan that could transform this largely abandoned area of home and office furniture showrooms open only to the trade from 10 a.m. to 5 p.m., Monday through Friday, to a place that would support 12 to 18 hours of use, seven days a week, with galleries, restaurants and design offices. While the plan was widely hailed as an award-winning blueprint for revitalization, the city chose not to invest the public funds required to implement it.
Fast forward 10 years, to the mid-1990s, soon after Craig Robins recognized the potential to sell “design” as a branded product. He began to acquire concentrations of buildings in the district and filled them with art galleries, architects and interior designers, surrounded by a concentration of design showrooms for lighting, plumbing, furniture and accessories. Much as the Maxwell + Partners plan had envisioned a decade earlier, Robins attracted innovative restaurants to an area where there had been none, and ensured that they were kept open at night.
Over a 10-year period, Robins re-envisioned the Miami Design District as a destination for ultra-high end luxury retailers, dining and entertainment. Robins’ vison for the Design District began with a $320 million investment in 35 buildings and lots. Partnering with L Real Estate, a global, luxury retail-driven mixed-use real estate investment and development firm sponsored by the LVMH Group, a French luxury conglomerate, he choreographed the redevelopment of his properties to attain and sustain excitement from consumers and investors. His strategy revolved around creating a highly visible and well-publicized planning process with noted urban designers and planners Duany Plater-Zyberk & Co. (DPZ).
Developer Robert Wennett’s Herzog & de Meuron-designed 1111 Lincoln Road in Miami Beach set the bar for unique garage designs when it opened in 2010. It has become a popular event space, hosting corporate events, weddings and celebrity-filled parties. In addition to its 300 parking spaces, the structure also contains 40,000 square feet of retail space and a rooftop restaurant. Neox Image Photography Studio (above) ©MBeach 1, LLLP & Neox Image Photography (below)
Dacra staged events celebrating the rollout of DPZ’s master plan for the district and Robins’ vision for reshaping the area as a place designed by designers for tenants and consumers seeking great design. The vision was simple: Use the most innovative architects to attract the most design-conscience tenants seeking exclusivity, uniqueness and a branded zone known for design. L Real Estate not only invested in the partnership; it also brought in LVMH Group’s brands — which include Prada, Louis Vuitton, Hermes and nearly 70 other world-famous fashion and luxury goods retailers — as tenants.
Today, the Miami Design District is being transformed into a global design and fashion hub. The urban design concept for the district involves the creation of a walkable shopping environment, like the fashion design districts in Milan and Paris, where shoppers will be able to peruse more than 100 brands in a welcoming, walkable neighborhood of numerous restaurants, two art museums, 12 public art installations and condominium buildings.
Following in the footsteps of developer Robert Wennett’s much-lauded 1111 Lincoln Road garage in Miami Beach’s South Beach neighborhood, Robins also focuses on design innovation on parking. The City View Garage, which opened in spring 2015, “advertises “ design, architecture and art to the adjacent interstate highway with facades by New York- and San Francisco-based design firms Leong Leong and Iwamoto Scott as well as murals by artist John Baldessari.
In keeping with Robins’ mission of selling design with designer architecture, the latest developments in the district include buildings by globally respected architects Sou Fujimoto, Aranda\Lasch and K/R (Keenen/Riley). Art installations in and around the district’s buildings by well-known artists and designers like Konstantin Grcic, Zaha Hadid, Marc Newson, Xavier Veilhan and the Buckminster Fuller Institute have been used as backdrops for fashion shoots and district branding.
The Miami Design District’s City View Garage, which opened in May 2015, features facades designed by Leong Leong (far right) and Iwamoto Scott (far left) and murals by John Baldesari (center). The 559-space facility was commissioned by LVMH and Dacra. Photo courtesy of Dacra, © Robin Hill
Robins has envisioned and continues to create a walkable outdoor neighborhood — not a mall — set into the core of the city that is unique, authentic, engaging, aspirational and, most of all, delightful. The value of his initial $320 million investment has increased to $1.4 billion. The reimagination of the district has attracted investors from New York and overseas who have bid up land prices dramatically. One 22,248-square-foot retail furniture showroom building sold in January 2015 for $26 million, equating to $1,906 per square foot for the two-story building. The property was previously purchased in 2009 for $2.5 million; the showroom, which opened in 2011, cost $4 million to develop.
In November 2014, General Growth Properties and Ashkenazy Acquisition Corp. teamed up to acquire a 20 percent stake in Dacra’s Miami Design District holdings for $280 million. Future development plans for the district include a new art-filled plaza surrounded by retail buildings and destination restaurants; a new Institute of Contemporary Art Miami (ICA) building by Spanish architects Aranguren + Gallegos; a 10-story hotel and an associated residential building designed by Neri & Hu and Studio Gang, respectively; and additional design showrooms.
The Wynwood Arts District
In the mid 2000s, as Robins was acquiring properties and beginning to redevelop the Miami Design District, a similar renaissance was beginning in Wynwood, a neighborhood adjacent and to the south of the district. The vision for revitalization of this area, however, was centered on up-and-coming artists rather than well-known artists and architects and elite fashion designers.
The Wynwood Walls program, which now features the art of more than 15 artists and covers over 800,000 square feet, making it one of the world’s largest open-air street-art installations, has been a catalyst for ongoing development in Miami’s Wynwood Art District. Photo by Martha Cooper, provided by Goldman Properties
Visionary developer Tony Goldman, who had helped revive New York’s SoHo neighborhood in the 1970s and Miami’s South Beach in the 1980s (and who passed away in 2012), saw an opportunity to create an artists enclave in Wynwood, an inner-city Miami neighborhood best known for wholesale shoe and clothing outlets and car repair shops. Goldman bought more than 25 of the neighborhood’s 1940s and 1950s-era warehouses, then sought artists and galleries to lease the space at low rents.
In the mid 2000s, Wynwood area investor/developer David Lombardi launched “roving Fridays” to promote the arts and stimulate leasing of his warehouses as art galleries. Those quickly evolved into a regular “Second Saturday Art Walk.” As the number of artists and galleries grew, Goldman put his organization and properties into branding the neighborhood as a place for the arts and working artists. As the contemporary arts crowds grew, he opened unique dining outlets and sought other restaurants as tenants to capitalize on the emergence of the new, hip arts market.
The art walks ultimately stimulated Goldman to create the Wynwood Walls, a series of murals painted on the exterior walls of warehouse buildings by celebrated graffiti artists from around the world. Over about a six-month period in 2009, 18 massive, provocative works of art were completed, just in time for Art Basel, attracting tens of thousands of visitors to the neighborhood during the art fair that year. The unveiling was a significant turning point for the neighborhood. By 2013, the number of visitors to the Wynwood Walls during the six days of Art Basel grew to more than 50,000. The Wynwood Walls program — which now features the work of more than 50 artists from 16 countries, covers over 800,000 square feet and has become one of the largest open-air street-art installations in the world — eventually became a catalyst for what has become another thriving arts district. Today, the Wynwood Arts District is home to more than 70 galleries, retail stores, antique shops and eclectic restaurants.
Colorfully painted by international street artists Interesni Kaski, Goldman Properties’ Wynwood House features a 7,000-square-foot first floor occupied by Luxury Brand Partners as a community space for creative stylists and hair and skin care professionals. The second floor houses 1,500 square feet of office/studio space, while the third floor contains eight live/work units ranging from 900 to 1,100 square feet. Photo by Martha Cooper, provided by Goldman Properties
As is often the case with gentrification, Wynwood is becoming so successful that real estate values have begun to skyrocket. For example, in the early 2000s, a warehouse building that would have leased for under $10 per square foot gross as an art gallery evolved into “creative and flex space” that only four years ago increased in rent to $25 per square foot. That space is now being leased for an average of $50 per square foot as “retail space” on prime Wynwood sites.
In June 2015, neighborhood landowners, including Goldman Properties, in collaboration with the city’s planning and zoning department and the Wynwood Business Improvement District (BID), created Miami’s first neighborhood revitalization district (NRD) within the Wynwood Arts District. The district’s new zoning and plan revisions aim to maintain and enhance the area’s character and to retain and develop affordable housing. They allow enhanced zoning density, transfer of development rights (TDRs) and smaller residential units. While they eliminate many formerly allowed industrial uses, the zoning changes now allow structures up to 12 stories high as well as flexible new uses intended to maintain the demand for creative spaces and galleries.
What It All Means
The takeaway message for developers and investors is not that good design or the installation of art assures a successful real estate project. Rather, it is about real estate fundamentals. A deep understanding of the market dynamics, cultural preferences and ideas that make great “people places” — places that are memorable as well as delightful — remains the foundation of success. Design, art and outstanding architecture are all tools that developers and cities can use to create these types of places.