REAL ESTATE

Mayfair in Coconut Grove adds major office tenant

 

The arrival of Sapient Nitro will complete the transformation of Mayfair in the Grove, which has struggled to reinvent itself.

ewalker@MiamiHerald.com

If the Mayfair shopping-and-hotel complex is any bellwether, Coconut Grove is headed for better times.

In the village’s boom days during the 1980s, Mayfair was the hot shopping destination for jet-setters from Latin America and Europe looking for designer fashions. But in recent decades the Grove has struggled, while Mayfair’s tenants and owners have flowed through a revolving door.

That seems to have stopped, thanks to a new strategy that has transformed the complex from a design-savvy mall to a hip office complex with some retail amenities.

The slow process started a decade ago with the arrival of ad agency Crispin Porter + Bogusky, which took over the former Regal Cinemas space. The final piece of the puzzle came Tuesday when Sapient confirmed it has signed a more than 10-year lease for about 70,000 square feet of office space at Mayfair in the Grove.

Sapient Nitro, the company’s interactive marketing agency, will bring between 400 and 600 new employees to work in the Grove when it relocates from Miami Beach. The move will happen in phases beginning a year from now and will take at least two years to complete.

“We needed to be in a hip, creative place for us and our clients,” said Gaston Legorburu, chief creative officer of Sapient Nitro and the company’s top executive in Miami. “If we went into a building on Brickell it would kill the soul of our brand.”

The Sapient deal brings Mayfair in the Grove’s occupancy rate to more than 90 percent. That’s a dramatic jump from a vacancy rate close to 40 percent when owner Timo Kipp of Whalou Properties bought the property out of receivership in late 2010.

To amass enough space for Sapient, Mayfair’s owner agreed to spend millions to convert prime ground-floor retail space on Grand Avenue into offices — a move that would have been unimaginable a decade ago. The space that Sapient is leasing includes the shops once occupied by The Bookstore in the Grove, Ann Taylor and Out of Africa, an art expo and antique store. Most of the tenants had long been on month-to-month leases and have already started closing.

“Ownership made the decision to go with an excellent credit tenant with a long-term lease,” said Chris Dekker, vice president of Jones Lang LaSalle, who represented owner Whalou Properties, along with Jones Senior Vice President Noël Steinfeld. “We offered all the retailers other space in the property and tried our best to make them sweetheart deals. At the end of the day, they all wanted the exosure of ground-floor space.”

Out of Africa is the only one of the retail tenants that will be relocating within Mayfair.

The vast majority of the 260,000-square-foot property will now be office space. Sapient and Crispin will be the two largest tenants, followed by Sony BMG Music Entertainment. Others include Regus Business Centers, Open English and Ygrene Energy; all arrived in the past year.

Mayfair’s remaining retail tenants include the Improv comedy club, Villa Mayfair restaurant and Chandi Wine & Spirits.

Office tenants aren’t just good for the building; they’re good for the Grove, creating a base of workers who eat in restaurants and spend money shopping in local stores.

“It’s a symbiotic thing, everyone feeds off each other,” said Manny Gonzalez, interim executive director of the Coconut Grove Business Improvement District. “The old Grove was all about the nighttime activity and the kids. Now there’s a viable lunch business and it’s only getting better. It’s a turning point.’’

In addition to the changes at Mayfair, the Grove will soon see an influx of real estate development. Terra Group has demolished the Grand Bay Hotel to build a luxury high-rise condo complex; the company also recently purchased the Coconut Grove Bank site with plans for a similar project. Pointe Group Advisors expects to break ground this year on the first phase of a six-block mixed-use project that will eventually include apartments, offices and retail shops. For Sapient, the Mayfair deal ends a two-year search for office space large enough for its existing 400 employees, who currently are divided between two buildings in Miami Beach, and leaves room for growth. Previously, Sapient Nitro planned to move to the old Omni International Mall in downtown Miami but had to scrap that deal after Genting purchased the property and announced plans to turn it into a casino. (Casinos have failed to win the approval required from the Florida Legislature.)

Sapient then looked for space in Coconut Grove, Miami Beach and the Design District; its leaders said they were amazed at how difficult it was to find contiguous space as large as 80,000 square feet that met their requirements.

“The real estate just didn’t exist to accommodate us,” Legorburu said. “It was really surprising.”

To make the deal in the Grove a reality, Sapient received financial incentives from the state of Florida, Legorburu said. A total of $6 million is being spent on the build-out, the company said.

“We just want to make sure our space is cooler than Crispin’s,” Legorburu said. “We have to do something crazy. It’s definitely going to be a showplace.”

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