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Dec 11th
Rebuilding the Boulevard PDF Print E-mail
Written by Erik Bojnansky, Senior Writer; Photos by Silvia Ros   
March 2014

Avra Jain is a one-woman redevelopment wonder

W02242014_avrajain_0384hen the 61-year-old Vagabond Motel at 7301 Biscayne Blvd. reopens in April, it’ll have three neon signs flashing out front, welcoming visitors, just like it did in the 1950s, when US 1 was the main highway for tourists road-tripping to Miami Beach or the Keys.

Guests will swim in the Vagabond’s fully restored pool. Or they can sit by two giant palm trees (each weighing more than a thousand pounds) while sipping drinks at a fully stocked pool bar.

The hotel’s 45 rooms will be equipped with flat-screen televisions, high-speed WiFi, and 1950s-inspired furniture from designer and entrepreneur Stephane Dupoux. The floors of some of the rooms will be covered with restored Dade County pine. The walls of all the rooms will be adorned with geometric shapes drawn by Ugandan artist Kenneth Nyakabwa.

By May, a 1950s-style diner and bar will be operating in the hotel’s former lobby.

That’s the plan anyway. And Avra Jain, the 52-year-old lead developer of the Vagabond, has been pressing her construction crews, electricians, designers, fellow investors, landscapers, and other vendors to meet that deadline. On any given day, you can see Jain on site, giving directions, analyzing change orders, negotiating with insurance adjustors, installing light fixtures, carrying packages, or picking up litter.

“She does as much of the work herself as she can,” says Joey Grill, founder of Click Models, who has partnered with Jain in real estate ventures here and in New York. “She does the work and shows by example what needs to be done.”

Her technique seems to be working. Just six months ago, the Vagabond was still boarded up and partially gutted. Its previous owner, former Hugo Boss executive Eric Silverman, walked away from the property in 2009, owing millions of dollars in mortgage payments, property taxes, and fines, after his efforts to bring the rundown motel back to its glory days failed.

In his absence, vagrants regularly broke into the place. Neighbors complained that the pool -- a noxious brew of rainwater, algae, and garbage -- had become a breeding ground for mosquitoes. To exterminate the mosquitoes, City of Miami employees tore down a wall on-site, backed in a truck filled with construction debris, and dumped it into the pool.

The debris has been replaced with clear-blue water. The wall has been rebuilt. The Vagabond’s crumbling roof was replaced, as were the historic building’s shoddy plumbing and utilities.

“This is a new building,” says Jain, “in an existing, fabulous shell.”

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That shell was originally designed in 1953 by B. Robert Swartburg, the architect who also designed the Bass Museum and the Delano Hotel in Miami Beach. About 15 months ago, Jain and her partners paid $1.9 million for that shell -- and that’s not counting the $5 million they intend to spend fixing up the place.

(Jain’s team is also promoting the building as the Vagabond Hotel, even though the signs outside announce it as the Vagabond Motel, which is how it is historically known. “Lots of motels don’t have pools or restaurants,” Jain explains. “Motel is not a great description. Hotel is a better description.” It’s also a better Internet search term. So far, she has no plans to ask the city’s Historic and Environmental Preservation Board for permission to change the sign.)

Jain raised another $7 million in order to buy four other post-World War II motels: the Royal Motel, the Bayside Motor Inn, Stephen’s International Motel, and the South Pacific Motel. They’re all within the MiMo Biscayne Boulevard Historic District, located between 50th and 77th streets, where demolition applications receive enhanced scrutiny from city staffers, and where new construction is restricted to a height of 35 feet.

Her goal: to create an environment that will help the area to continue improving by phasing out cheap motels blamed for the presence of prostitutes and drug dealers on the street after dark, and sometimes even during the day.

“I focused on the motels,” Jain says, “because if you change the motels, you change the neighborhood.” She’s walked into some of them, she explains, and has seen signs that read: No refund after five minutes. “What does that say?” she asks.


NCover_2ancy Liebman, president of the advocacy group MiMo Biscayne Association and a former Miami Beach city commissioner, compares Jain’s business model to that of the late Tony Goldman, a New York developer who bought several old Art Deco buildings in South Beach in the 1980s and transformed them into upscale boutique hotels, revitalizing Ocean Drive and Collins Avenue in the process. “Bringing back these [Boulevard] motels will bring back the significance of the historic district,” Liebman says. “Up until now, people thought they were just a bunch of dumps.”

:But Jain isn’t just buying old motels. She and her partners recently closed on a circa-1973 office building at 5555 Biscayne Blvd. She also co-owns land in the Design District, the ground-floor retail spaces at Marina Blue condominium in downtown Miami, the Regions Bank building at 3550 Biscayne Blvd., warehouses in Little Haiti, and various apartment buildings in Miami.

And she’s on the hunt for more opportunities.

“She’s an amazing woman,” says Lyle Chariff, founder of the Chariff Realty Group, who owns a parcel of vacant land with Jain in the Design District. “She’s nonstop. It’s like she’s 50 people combined into one.”

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“It’s probably best that I don’t think about it,” Jain jokes when the BT asks how many projects she has under way. “Every day I know what needs to get done, and I get it done. It doesn’t seem overwhelming to me.”

Jain is exceptional in the South Florida real estate world. For one thing, there’s her gender. Although many women in this region are top-selling brokers, with some even owning their own agencies, the vast majority of developers in South Florida are men. “It’s a rare situation,” says Truly Burton, executive vice president of the Builders Association of South Florida, regarding female developers. “This is going to sound a little bit Old World, but it’s a man’s world.”

Jain also tends to invest in places before they’re swarmed over by other developers and speculators. “She’s unique because she sees the potential value of areas that other people don’t see initially,” says Tony Cho, CEO of Metro 1 Properties and a venture partner of Jain’s in the redevelopment of Rail 71, a 130,000-square-foot warehouse space on 3.7 acres at 7205 NE 4th Ave., adjacent to the FEC railroad tracks. (Their plan: Create a space that will attract startups, retail furniture, and food and beverage companies.)

Catching Jain’s eye right now are motels, warehouses, office buildings, small parcels, and faded apartment buildings along Miami’s Biscayne Corridor, particularly in the Upper Eastside and the Little River area of Little Haiti. But 12 years ago, her focus was more geared toward building new things.

In 2002, Jain and her partners reportedly spent $19 million assembling nearly five acres of land by the Adrienne Arsht Center for the Performing Arts with the intent of building a 57-story high-rise called Opus, along with a Miami branch of the Whitney Museum of American Art. But the Florida Department of Transportation wanted the land for the eventual expansion of I-395 as it approaches the MacArthur Causeway. Although the land was seized through eminent domain, the state did give Jain and her partners $78 million for their troubles, according to media reports.

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In 2004, Jain invested in Kubik, a proposed two-tower, 16-story condominium project that was to be built at 5700 Biscayne Blvd. But neighbors objected to the scale of the project. Tied up in litigation for years, Jain left the Kubik venture in 2008. That controversy helped inspire the creation of a 35-foot height limit in the MiMo District. The Kubik site, meanwhile, remains vacant.

Jain’s last two major projects coincided with the onset of the Great Recession. She acknowledges that she took a huge loss on Blue at Doral (now known as the Blue Hyatt Residences). In 2009, she also sued Beal Bank Nevada in federal court for her partnership to retain a 25-percent stake in Regalia, a 42-story, 40-unit luxury condo in Sunny Isles Beach. Jain expects to take a loss on that project as well.

“We both had some hard times and we lost a lot of money doing big projects,” says Paul Murphy, Jain’s partner at the time. During the economic downturn, he confirmed they lost five parcels of land.

Jain stares into space when recalling what she calls the challenging times. “I think that was a bad time for a lot of people,” she says. “Not just for me, but the whole world.

“I’m just so glad it’s over,” she adds. “You find out who your friends are. And it’s disappointing sometimes, but that’s just part of the learning process.”

Actually, it’s not quite over. Two of her former partners, Jerold Kaufman and Abraham Cohen, both from Aventura, filed a lawsuit against her and Murphy in December 2013. They claim that Jain and Murphy defrauded them “in an attempt to improperly retain millions of dollars of profits for themselves” related to the Regalia project.

Jain and Murphy recently filed a countersuit, claiming it was Kaufman and Cohen who defrauded them. Jain and Cohen, meanwhile, have been locked in a litigious battle over Blue at Doral since 2009.

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Neither Kaufman nor Cohen returned phone calls from the BT by deadline. Their lawyer in the Regalia suit, Robert Stok, says his clients want their investment in the project honored, but Jain allegedly isn’t intent on negotiating. “She’s a bare-knuckle fighter,” he says.

“I prefer to wear gloves,” Jain quips. “I was willing to let some things go, but once they attack you, then you have to set the record straight.”

A couple of hours earlier, Jain had been in the midst of a beehive of construction activity at the Vagabond. Now she’s off in a Volkswagen GTI to check out an apartment she might invest in elsewhere in Miami. She’s not just checking out a property -- she’s scouting a potential partner worthy of navigating Miami’s recovering real estate market.

“It’s about finding good partners,” Jain says as she works the stick shift. “There’s a lot of money out there right now. A lot of money. But there aren’t many good deals -- a lot of money chasing not that many good deals.”

Jain has never embarked on a real estate project alone. She always enlists partners. Aside from the equity they bring to a project, they provide their special expertise. Partners, she says, can make or break a project. “Having good partners is really helpful,” Jain says. “Having a bad partner is the worst. You can’t focus on what you’re doing.”

Jain says she didn’t have to worry about “bad partners” until she came to Miami. “I was a little naive,” she admits. “In New York we did everything by handshake. Your word mattered. I’ve been disappointed. I felt that some people made representations about things and they didn’t [fulfill them].”

Her lesson? Match the right partners to the right projects, be more particular, and stay in control. Her letdowns, Jain notes, occurred in situations where she was not the lead.

At the building, Jain is greeted by the prospective partner, the current owner of the apartment building, and a few real estate brokers. One of those brokers, Daniel Cunningham, a senior associate with Marcus & Millichap, is already among her fans.

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“Most people, they want to see what’s here today,” he says, “and they don’t want to see what could be here tomorrow. The typical people [in real estate] think they have vision, but they’re really following somebody else’s. But she’s obviously seeing something that other people haven’t seen yet, and she’s the first one in.”

The apartment building is a faded yellow, two-story structure. Its tenants converse in Creole and English while the landlord shows Jain around. At the rear of the building, next to a wicker basket full of flattened aluminum cans, roam a hen, rooster, and a half-dozen chirping chicks. This inspires a discussion among the brokers about the City of Miami’s “chicken patrol.” Jain, though, remains focused on the particulars -- the condition of the roof, what parts of the apartment building are made of concrete, what parts are made of wood, evidence of termites, and the renovation activities of other developers in the immediate neighborhood.

From the second floor she spies another apartment building. This one has just been renovated. One of the brokers familiar with the landlord of that building tells her he’s seen more cars parked in the lot lately. It’s a promising sign. When it comes to making modest upgrades in a neighborhood (just enough so that apartments are still market-rate affordable), Jain likes allies.

“Can we take this little block, buy enough of it?” Jain had asked herself just prior to the apartment tour. “Can we make it our own little enclave? We have to own enough of it. Or the right people will have to own enough of it.”


A
Cover_7vra Jain was born in California and raised in Champaign, Illinois. Her father, Ravinder Jain, from India, is a civil engineer who has written numerous textbooks on environmental analysis. Her mother, Barbara, can trace her ancestry in America to pre-Colonial times and is in the continuing adult education field. She was an assistant dean in the social services department of the University of Illinois. Avra has a twin sister, Anna Jain Bakst, who is the president of footwear and accessories for Michael Kors Holdings Ltd.

Jain says she took an early interest in building things, even building her own treehouse when she was a child. When she attended Purdue University for her degree in industrial engineering, she was the only woman in her class.

Her college education was paid for by a tennis scholarship. Avra and Anna were three-time state doubles champions in high school (between 1978 and 1980), a record that stood for more than 30 years. Their key to victory, Anna told Champaign’s local paper, the News-Gazette, was that “we were mentally tough.”

As for the skills Jain learned at Purdue, she first applied them in what would become a 16-year career as a bond trader in New York. “A strong math background works very well on Wall Street,” she says.

Did she get rich? “It was enough money,” she replies.

Certainly enough to embark on a new hobby: buying and fixing up old buildings in the SoHo and North Tribeca areas of New York City. “I bought lofts,” she says. “Then I bought bigger lofts. And I kept investing and investing. Some [Wall Street traders] used their money to buy stock or cars or homes in the Hamptons. I bought real estate in New York.”

For a time, Jain was able to indulge in this pastime while still trading on Wall Street. That changed in 1998, when she tackled Cobblestone Lofts, a 100,000-square-foot conversion project in Tribeca.

“I left [Wall Street] because I went to a big project,” Jain says. “Up until then, I was kind of dabbling on the side.”

It’s through real estate that Jain met Joey Grill -- a moment he describes as “love at first sight.” Professional love, actually; he appreciates her passion for restoring buildings. “We renovated many landmarks and buildings together,” he says. “In my opinion, her desire for profits is a by-product of her passion for building.”

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A different kind of passion was the reason Jain left New York for Miami in 1999. “I got involved with somebody who was here,” says Jain, who frequently visited South Beach in the 1980s. “It was a person I was with for nine years. She was my girlfriend at the time.” That girlfriend, whom Jain declines to name, even agreed to carry Jain’s fertilized egg in her womb. They’re no longer together, but Jain and her daughter, now nine, stayed in Miami.

For the past seven years, her partner in life and business has been 56-year-old Dalia Lagoa. They met in a Miami party in 2002. “It was all very interesting because we both worked in New York at the same time,” Lagoa says. “But we never ran into each other until we moved to Miami.”

“Her résumé is off the charts,” Jain says. “She was a managing director of [the Paris-based bank] Société Générale. She did global structural finance for them, and she retired at 45 because she could.”

That’s why Lagoa came to Miami, to retire. Instead, she’s going into the motel business. She holds a stake in the Vagabond and the other m

otel purchases. She’ll even manage the Vagabond, at least until a permanent management company is found.

“She loves real estate,” Lagoa says of Jain. “And the more I got to hang out with her, the more I got to like it too.”

The 5555 building on Biscayne Boulevard is a 16,000-square-foot glass box on stilts with gated parking. Inside are water-damaged tiles, 40-year-old disco-era light fixtures, orange floor tiles, an obsolete phone switchboard system, solid-wood doors, and a clunky elevator. Jain and Joseph Del Vecchio, a real estate investor from New York, bought 5555 for $2.3 million last month. They love the parking, the high ceilings, the solid concrete bones. And they really love the location.

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“It’s in the heart of what’s happening in Miami,” Del Vecchio says. “This is the heart of the neighborhoods that are being renovated. And look,” he says, pointing at the 55th Street Station just west of the Boulevard, “there’s Soyka’s [restaurant] across the street.”

Del Vecchio and Jain have known each other for about two years. On the first day they met, Jain showed him the seven-story Regions Bank building at 3550 Biscayne Blvd. “Our mutual friends put us together, figuring we had a similar mindset on real estate development and investing,” Del Vecchio says. “The minute we realized we did share the same mindset, we decided almost immediately we should buy the building. Avra took the contract out, we signed it, and the rest is history.”

Del Vecchio also owns a piece of the five motels. He and Jain hope to bring more quality offices to the Biscayne Corridor. “You’re starting to see a large demand for office space,” Jain says. So much demand, in fact, that the Regions building, after an extensive upgrade, is now 90 percent occupied.

To add more quality office inventory, they plan to demolish everything inside the 5555 building and transform it into a state-of-art office facility.

They’re also turning motels into offices. The 68-year-old Stephen’s International at 6320 Biscayne Blvd. will become an office and retail plaza called the Stephen’s MiMo Plaza. (Or what’s left of it. The hotel was in such dismal shape that most of it is being torn down. Only the historically significant “bookends” will remain.) The circa-1953 South Pacific Motel at 6300 Biscayne Blvd. will also be converted into offices.

Cover_10Less clear is the future of the 62-year-old Bayside Motor Inn at 5101 Biscayne Blvd. Dean Lewis, the architect for Jain’s motel renovation projects, says it may remain open as a motel, or it could become an extended-stay hotel, or maybe transformed into live-work spaces for artists.

The Royal Motel at 7411 Biscayne Blvd., which opened in 1951, will remain a motel once its renovations are completed in about a year. But the Royal will essentially become a 25-room annex for the Vagabond next door. So will an apartment building at 7272 NE 6th Ct., which will offer ten family-size units. Altogether, when fully operational, the Vagabond and its affiliates will have 80 rooms.

Regardless of what the motels of Biscayne Boulevard are used for, the fact that a team of investors has come in, intent on redeveloping them, has created excitement in the historic district. “From my perspective, there has been a tremendous uptick for demand in property on Biscayne since they [Jain and her partners] have been doing this,” says Tony Ulloa, a Keyes commercial broker.

The Jain development wave has also pleased Walter Figueroa, whose family owns the fully restored 1953 New Yorker Boutique Hotel at 6500 Biscayne Blvd. It improves his customer base, increases the hotel’s property value, and proves a point. “I’ve been saying this forever,” Figueroa declares. “Somebody should come here and see the potential of the Boulevard.”

Figueroa, who completed a five-year revamp of the New Yorker in 2010, has long argued that the $200-plus room rates in Miami Beach provide an opportunity for Boulevard motels to offer an affordable, clean alternative for tourists. Plus, it’s hard for people staying in Miami Beach to leave the Beach -- or find parking. “We’re busy all the time,” he says. “We have free parking and easy access to anywhere from here. People love it.”

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 In fact it was the New Yorker’s high occupancy rate that grabbed Jain’s attention. “One reason I realized there was an opportunity on Biscayne Boulevard was that my friends tried to stay at the New Yorker and they couldn’t get a room,” she says.

The MiMo District’s 35-foot height limit didn’t even dissuade her. Reacting to the concerns of Upper Eastside residents fearful that their part of the Biscayne Corridor would be overrun by developers, Miami City Commissioner Marc Sarnoff demanded a 35-foot height limit for the historic district as part of Miami 21, an overhaul of Miami’s zoning laws. Prior to the height limit, developers could build up to 95 feet on Biscayne Boulevard, says architect Dean Lewis. Despite opposition from property owners, the Miami City Commission narrowly approved Sarnoff’s height limit by a vote of 3-2 in October 2009, and enacted it the following year.

Property owners weren’t the only ones who opposed the 35-foot cap. Some motel preservation advocates, including Nancy Liebman of the MiMo Biscayne Association, feared the height limit would dissuade developers from renovating the motels because they couldn’t add an extra floor for more revenue. The MiMo Biscayne Association pushed for a 53-foot height limit instead.

But property owners weren’t completely stripped of their options. The new height-limit law allows them to sell their “development rights” to developers whose projects are located in specially designated, high-density zoning areas of Miami. The project in the high-density zone thus obtains a “development bonus” in the form of greater height or density rights than it was initially granted.

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For example, if a property owner in the historic district could have built a 100,000-square-foot building prior to Miami 21, but can only build 40,000 square feet because of the height limit, the owner can sell the balance of 60,000 square feet of “air rights” to someone else in a designated high-density area.

Utilizing her contacts in the real estate world, Jain was the first developer in the MiMo District to sell air rights (development rights) to another builder. Last year she sold 440,000 square feet of the Vagabond’s development rights for $3 million to Jorge Pérez’s Related Group and David Martin’s Terra Group, enabling the two developers to enlarge the size of their condo projects in Coconut Grove, Edgewater, and Brickell. (Martin is also a partner of Jain’s in the Regions Bank building project.)

She also sold the Royal Motel’s 142,868 square feet of air rights to Property Market Group’s Kevin Maloney for the 57-story Echo Brickell project at 1451 Brickell Ave.

“Selling air rights allowed us do an extension renovation at the Vagabond,” Jain says. “Otherwise, the property didn’t warrant so much spending.”

The process was a learning curve for her and the city. Jain says it took six months of conversations between city planners, architect Dean Lewis, and land-use attorney Lucia Dougherty to figure out a system.

“There was no market for TDRs [transfer of development rights] when we started this,” says Lewis. His office is now inundated with calls from MiMo District property owners, especially vacant parcel owners interested in selling their own air rights. But selling development rights is a complicated process, the architect warns. A landowner can’t just simply sell air rights over a vacant lot, for example. “You can’t just sit back and reap the benefits of TDRs without doing the work” of building, he says.


DCoverStory_13_Vagabond_renderingark clouds were forming in the sky and there were dozens of boxes of fragile lights sitting out in the open. A vendor just left them there, beside the outdoor furniture meant for the Vagabond and another client. Most of the lights were for the Royal Motel and the Vagabond’s restaurant. They wouldn’t be ready for installation for weeks.

The truck that was supposed to take the materials to a warehouse hadn’t arrived, and the vendor wasn’t answering her phone.

“It’s going to rain, and she’s not here,” Lagoa fumes to Jain.

Jain, Lagoa, and a gargantuan foreman discuss their options. Should we put the boxes in the hallway? How about one of the rooms? Which room?

“You know. I don’t think it’s going to rain,” the foreman says, “but it’d be best if we hurry.”

It will rain, a lot. A half hour from now, sheets of water and electricity will fall from the sky and crash to the ground. But right now the sky is just a bit gray, although it’s getting grayer.

“You say the word,” the big guy tells Jain, “and we’ll…”

“Yep,” Jain replies.

And with that, six people, including Lagoa and Jain, started grabbing boxes. Jain had expected to do some work on the site anyway. She’s wearing blue Sears overalls. Eventually, they form a human chain. Then about three people not grabbing boxes start asking Jain questions about color schemes. They’re vendors. Jain talks to one of them for a few minutes without a pause in the box brigade, before referring him to designer Stephane Dupoux. (Dupoux, by the way, is also a partner in the Vagabond.)

About 15 minutes later, the boxes are loaded into two rooms. The outdoor furniture remains outside. But Jain doesn’t want to leave the furniture unattended. So she volunteers to stay nearby in her construction office, located in a giant room inside the Royal Motel until the truck arrives. (The construction office previously served as the residence for the Royal’s previous owners.)

Is she annoyed? Not at all, Jain answers. The Vagabond is a complicated project, she explains. Things happen.

“You can’t sweat the little things,” Jain says. “The big things you can get upset about. The little things, you can’t get upset about.”

 

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