Cervera RE Ventures Buys HiaLeah Shopping Center

Javier Cervera’s Cervera R.E. Ventures added another South Florida retail property to its portfolio with the $17 million acquisition of Twin Towers Shopping Center in Hialeah.

Coral Gables-based C-REV secured an acquisition loan from U.S. Century Bank at 50 percent loan-to-value for the 36,575-square-foot shopping center at 4516 West 12th Avenue, at the intersection of West 12th Avenue and West 46th Street, according to brokerage firm Marcus & Millichap.

The price pencils out to $465 per square foot.

Drew Kristol and Kirk Olson of Marcus & Millichap worked with the seller, an affiliate of CD Group, led by Maurice Cayon. The seller of the 2.9-acre property paid $2.9 million for the property in 1999 deed records show. 

Cervera, president and CEO of C-REV, said Twin Towers was “an ideal fit” for its small retail spaces, mix of service-oriented tenants and proximity to other shopping centers in the company’s portfolio.

Rents at the shopping center average $35 per square foot, Cervera said. Hialeah ranked among the best places in the nation to start a small business this summer, in part because of its affordable retail rent compared to Miami hotspots like Wynwood.

Built in 1978, the 15-suite shopping center’s largest tenant is Las Mercedes Medical Center. C-REV negotiated a long-term lease renewal with the medical provider for the 12,800-square-foot space before completing the sale of the property. 

Other tenants include a restaurant, medical providers and service-oriented businesses.

Cervera said his previous relationship with the seller allowed C-REV to negotiate a deal before the property was publicly marketed.

C-REV acquired Twin Towers at a capitalization rate just shy of 6 percent, Cervera said. The cap rate measures a property’s annual return relative to its purchase price. A cap rate of 4 to 6 percent typically indicates less risk.

Cervera said the previous owner made some improvements to the property, and C-REV does not expect major renovation work, unlike some of its other value-add acquisitions.

One example of this value-add strategy in C-REV’s Hialeah retail portfolio was the 74,400-square-foot Ready Listo property at 3800 West 12th Avenue, which the company acquired in 2018 for $12.7 million in an off-market deal where 90 percent of the tenants were on month-to-month leases. 

Those short-term leases gave it an opportunity to raise rents to market rates and improve the tenant mix, the company said. C-REV renovated the property and signed new leases, increasing annual income from just under $900,000 to $1.8 million. The company later refinanced the property, returning 41 percent of the original equity to investors. C-REV now values the property at $22.65 million, or $9.91 million more than its purchase price.

Founded in 2005, C-REV is a long-term holder of retail, industrial, office and multifamily properties and land assemblages throughout South Florida. For its retail strategy, Cervera said the firm focuses on established, income-producing neighborhood shopping centers in high-density areas. Its other retail properties include assets in Coral Gables, Cutler Bay, Kendall and Miami.

Cervera said the firm is pursuing acquisitions across the tri-county area, with Hialeah among its top areas of focus, and another deal in the works near Twin Towers Shopping Center.

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