Oceana Bal Harbour project gets $332 million loan

 

The developer of an ultra high-end condominium project obtained bank financing.

Joaquin Escandon OZ

mbrannigan@MiamiHerald.com

Consultatio said it obtained a $332-million construction loan for its ultra high-end condominium project, Oceana Bal Harbour, from a consortium of banks led by HSBC.

“We thought it would be convenient for the company to obtain such a credit facility,’’ Argentine developer Eduardo F. Costantini, the head of Consultatio, said in the telephone interview from Buenos Aires.

Consultatio expects to complete its first U.S. project, Oceana Key Biscayne, at the end of July. The Key Biscayne condo project —where prices have already soared above pre-construction prices —was financed without any bank financing, relying instead on developers’ equity and buyers’ deposits, Costantini said. As his firm delivers those units to buyers, it will amass cash to pursue other projects “in Miami and New York,’’ Costantini said.

Construction began in December 2013 on the Bal Harbour project, an all-glass tower that will have 240 units along a 400-foot stretch of oceanfront in the tony community of Bal Harbour, the site of the old Bal Harbour Beach Club. It will feature sculptures by Jeff Koons.

Costantini said the Bal Harbour project, which is selling at an average price of $1,800 per square foot, already has “north of $350 million of signed contracts’’ to buy units and a total of more than $400 million in commitments, including reservations. Total sales for the project will be in the range of $1.2 billion to $1.3 billion, he said.

Costantini is using the popular buyer-deposit model for the project. Unit buyers are asked to put up 10 percent when making a reservation; another 20 percent upon signing a contract; an additional 10 percent when construction reaches the fourteenth floor; and 10 percent when the building is topped off. The remaining 50 percent is due at closing.

After getting slammed in the real-estate crash, commercial banks withdrew from construction lending. With the rebound in the housing market and other sectors of real estate, lenders are increasingly financing construction in South Florida and elsewhere, although at more conservative levels than before the crash.

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