Commercial Real Estate
South Florida

Grant Cardone to buy $750M in SoFla apartments

Cardone Capital will bring in retail investors with a new $75 million fund

Grant Cardone and a rendering of LAs Olas Walk (Cardone Capital, ZOM/McNeal Realty)

Grant Cardone and a rendering of LAs Olas Walk (Cardone Capital, ZOM/McNeal Realty)

Grant Cardone is on a buying binge in South Florida.

Cardone Capital plans to buy four Class A apartment buildings in South Florida worth $750 million and launch a $75 million fund allowing retail investors to get in on the deals.

Cardone Capital plans to buy two Class A apartments near downtown Fort Lauderdale as well as an apartment complex in Sunrise and one in Weston. Cardone said the deals have not closed, but he has commitments from lenders and a deposit in place.

Cardone Capital declined to disclose the addresses of the properties, but from photos provided to The Real Deal indicate one of the properties is the 456-unit Las Olas Walk, which was built by ZOM Living this year.

According to Cardone, all four properties are 99 percent occupied and will be branded under his 10X brand.

Cardone’s fund structure is unique. He purchases buildings and finances projects through individual loans. After the deals are closed, he allows small-time retail investors to collect on the cash flow from rent. This is permissible because the Securities and Exchange Commission’s “Reg A” allows non-accredited investors to get into deals often reserved for bigger players.

“I do not get money from family funds, country clubs or rich people,” said Cardone. “In my estimation, those people are like spoiled children you can never please.”

Cardone, who has 3.4 million followers on Instagram, is a motivational speaker who hosts the 10X Growth Conference. He has amassed a large portfolio of apartment complexes throughout South Florida in recent years, using his social media following to drum up investors.

The approach has been controversial but successful for Cardone: In May he bought himself an oceanfront Golden Beach estate for $28 million from Tommy Hilfiger.

Cardone claims he can close on deals quicker than institutional investors. “I don’t need a bunch of 27-year old accountants and a bunch of old guys who are checked out to get approval,” he said.

Cardone Capital has a targeted internal rate of return of 15 percent for the fund. To be sure, that is not a guarantee.

In Sept. 2020, an investor from California sued Cardone Capital alleging that the company misled him about the rate of return and the acquisition and financing of the properties. In May, a federal judge dismissed the suit, saying the investor did not show that Cardone made material misrepresentations. The judge said the investor documents were clearly disclosed.

Cardone’s new fund comes just a few months after his company purchased an office building at 18851 Northeast 29th Avenue next door to his 10X headquarters in Aventura for $93 million. Cardone previously said the site could become a mixed-use development with a residential component.

Cardone Capital in May bought the Camino Real Apartments in Boca Raton for $69 million.

COMPANIES AND PEOPLE

Tags
Commercial Real Estate
South Florida

Grant Cardone to buy $750M in SoFla apartments

Cardone Capital will bring in retail investors with a new $75 million fund

Grant Cardone and a rendering of LAs Olas Walk (Cardone Capital, ZOM/McNeal Realty)

Grant Cardone and a rendering of LAs Olas Walk (Cardone Capital, ZOM/McNeal Realty)

Grant Cardone is on a buying binge in South Florida.

Cardone Capital plans to buy four Class A apartment buildings in South Florida worth $750 million and launch a $75 million fund allowing retail investors to get in on the deals.

Cardone Capital plans to buy two Class A apartments near downtown Fort Lauderdale as well as an apartment complex in Sunrise and one in Weston. Cardone said the deals have not closed, but he has commitments from lenders and a deposit in place.

Cardone Capital declined to disclose the addresses of the properties, but from photos provided to The Real Deal indicate one of the properties is the 456-unit Las Olas Walk, which was built by ZOM Living this year.

According to Cardone, all four properties are 99 percent occupied and will be branded under his 10X brand.

Cardone’s fund structure is unique. He purchases buildings and finances projects through individual loans. After the deals are closed, he allows small-time retail investors to collect on the cash flow from rent. This is permissible because the Securities and Exchange Commission’s “Reg A” allows non-accredited investors to get into deals often reserved for bigger players.

“I do not get money from family funds, country clubs or rich people,” said Cardone. “In my estimation, those people are like spoiled children you can never please.”

Cardone, who has 3.4 million followers on Instagram, is a motivational speaker who hosts the 10X Growth Conference. He has amassed a large portfolio of apartment complexes throughout South Florida in recent years, using his social media following to drum up investors.

The approach has been controversial but successful for Cardone: In May he bought himself an oceanfront Golden Beach estate for $28 million from Tommy Hilfiger.

Cardone claims he can close on deals quicker than institutional investors. “I don’t need a bunch of 27-year old accountants and a bunch of old guys who are checked out to get approval,” he said.

Cardone Capital has a targeted internal rate of return of 15 percent for the fund. To be sure, that is not a guarantee.

In Sept. 2020, an investor from California sued Cardone Capital alleging that the company misled him about the rate of return and the acquisition and financing of the properties. In May, a federal judge dismissed the suit, saying the investor did not show that Cardone made material misrepresentations. The judge said the investor documents were clearly disclosed.

Cardone’s new fund comes just a few months after his company purchased an office building at 18851 Northeast 29th Avenue next door to his 10X headquarters in Aventura for $93 million. Cardone previously said the site could become a mixed-use development with a residential component.

Cardone Capital in May bought the Camino Real Apartments in Boca Raton for $69 million.

COMPANIES AND PEOPLE

Tags