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Out of the Cold
Corvus International LLC has four projects, worth about $249 million, planned for Sarasota-Manatee counties, and more projects are expected in Tampa and Southeast Florida.
By Sean Roth
Real Estate Editor
Bloomfield Hills, Mich.-based Corvus International LLC averages $250 million annually developing commercial buildings for General Motors and its suppliers worldwide. Now, the real estate powerhouse has turned its attention to the Sarasota and Manatee market and plans to diversify its holdings with a staple of residential and mixed-use developments. Chalk up one more business boon to the warm weather.
Locally, Corvus International is essentially four people: Tim Morris and Larry Lipa, both principals; Tim Vining, principal of the firm's Florida operations; and Bruce Linthicum, director of design services. Morris is primarily the sales side of Corvus International; he provides market analysis, leasing and sales expertise. Lipa, on the other hand, handles financing, architectural design, construction and property management. Vining, a principal in the Sarasota-based general contracting firm of W.G. Mills Inc., provides local market information along with construction planning and development management.
The concept behind Corvus International is really a product of the mid-1990s, Morris says, although the company got its start earlier than that, in 1973. At that time, automakers were eliminating non-core skills from their companies.
"It was the growth of outsourcing," Morris says. "We decided to make it our business model to take on the whole real estate function of these former real estate departments. Being in Michigan, we had existing relationships with the Big Three (Ford, Chrysler and GM). Our goals were to take all the steps from plan to plant. We would find the sites. Find any governmental incentives, and get the financing in place. Then we would build it." The company also went after the major suppliers to the Big Three.
Corvus International also provides services for the four Midwestern industrial platforms of Heartland Industrial Partners, an equity fund with a market capitalization of $20 billion. Those four companies operate about 500 facilities globally.
The company typically builds five to six commercial properties a year, but the developments are large in scale and highly specialized.
The idea of Corvus International developing Gulf Coast projects came about when Morris and Vining met at a fundraiser for their children's school, St. Stephen's Episcopal School in Bradenton. Morris had started living in Sarasota half of the year about five years ago.
"It was mainly the weather," Morris says. "I was trying to escape the cold. We would stay through the school year. (Tim and I) just met through the school. In the couple years I was here, it was obvious the growth in the area."
Vining gave Morris the local real estate knowledge base Corvus International would need to get started. It was also decided that separate from the local Corvus International real estate projects, Morris, and Vining would partner several residential projects through a development company called Bluewater Development & Construction.
But before Corvus International or Bluewater Development could start developing, the partners needed financing. Morris approached a pension fund that Corvus International had done business with previously. "They needed to get comfortable," he says. "It took about two-and-a-half to three years. But all those pieces just came together. They gave us almost an open check book."
Vining knew where to begin. In October of last year, Corvus International bought about 32.5 acres in the Riviera Dunes development in Palmetto for a total of $8.6 million. A few months later, the company bought another three acres in the area for $1.95 million.
Riviera Dunes, an upscale 214-acre mixed-use development located next to a man-made inlet, had been under construction since 1996. Vining started tracking the project in 1999, when the developers received permits to dig an inlet off the Manatee River. While home sales in the development are progressing well, the commercial components lagged. There are only three commercial projects on the site: a 220-slip marina and Mangrove Grill & Bar restaurant, a 7-Eleven gas station and a Genesis-Tony Jacklin Golf Center.
Morris, Lipa and Vining plan to build a total of 172 units in three towers with supporting boardwalk retail and four U.S. 41 frontage retail outparcels. The $140 million project, which is being called Bel Mare at Riviera Dunes, will provide a gated-community feel for the residents of the 15-story towers while allowing public access to the boardwalk and frontage retail. As currently designed, the towers' residents will have access to a private preserve area with about seven acres of outdoor amenities, including tennis courts and a chipping and putting practice range.
"We wanted to make this a true destination," Lipa says. "These residents would conceivably never have to leave the development. We are targeting professionals and people who are looking for an active lifestyle." In addition, the developer expects the retail/commercial space to amount to between 30,000 square feet and 50,000 square feet. The project was designed by the Tampa architectural firm of Curts Gaines Hall and Jones Architects Inc.
At the same time, Corvus International partnered with the Devlin Group of Sarasota and BSG Communities Inc. to develop Positano on the Gulf, a 29-unit, five-building condominium development on 10 gulf-front acres on Longboat Key. Already, 14 units, price from $2.5-million to more than $3.5-million, have been sold. The units range in size from 4,095 square feet to 4,670 square feet and construction is expected to start in April. When the first phase of the project is completed in March of 2005, it will be Corvus International's first residential development built outside of Michigan. Andy and Tom Cail of RE/MAX Properties of Sarasota are selling the development.
For its third local project, Corvus International is building a 9,500-square-foot Mediterranean-style spec home at 5060 Gulf of Mexico Drive on Longboat. "We hope to come out of the ground in mid-May," Morris says. "This is going to have the Palm Beach level of opulence." The house is priced from $8.5 million to $9 million.
Corvus International's newest development is a two-building mixed-use project just north of the Ringling Museum near New College on Bayshore Road. One of the buildings in the $20 million Ringling Commons will offer 12,000 square feet of office space, while the second, a 88,000-square-foot building, will offer both residential and retail space. Construction on the two buildings is scheduled to start later this year.
In addition to the area's four developments, the partners have deals developing in Tampa and Miami.
All this is on top of on-going automotive related activity, primarily in Michigan. In December, Corvus International completed an 123,000-square-foot warehouse building in Howell, Mich., for E. F. Hollingsworth Co., which will manage the machinery-parts warehouse for GM. Corvus International is also building a 200,000-square-foot warehouse building next to a GM aluminum foundry in Saginaw, Mich.
Partnerships, such as those in the Positano condominium project, are an important part of Corvus International's business structure. The company only employs 12 people in its principal company, but it has a worldwide network of local partners.
"We like to find people with local market knowledge, like Tim," Morris says. "That way we can build just about anywhere ... without the overhead of having 350 people on the payroll. It is a matter of meeting the right people and forming a partnership. A key to the success of a project is getting the right team together. We pay for that local knowledge base. We have more of a web corporate structure. I have seen too many companies grow vertically and collapse. We have the benefits of a big corporation, and we are nimble and fluid enough to move when the deals make sense."
Larry Lipa, Tim Morris and Tim Vining plan to develop the Bel Mare at Riviera Dunes in Palmetto as three 15-story condominium towers with up to 50,000 square feet of retail space and seven acres of outdoor amenities.
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