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Michael Swerdlow: The Power Center
Today, less than a decade later, Swerdlow has become one of South Florida's most powerful commercial developers. His privately held company controls some 4.5 million square feet of retail space; and his impressive portfolio of properties, which stretches from Miami to Tampa and includes residential development land, office buildings and industrial space, is worth more than half a billion dollars. Broward remains the bedrock of the Michael Swerdlow Cos., with Hollywood Inc. as the centerpiece. It was a family feud that put the 58-year-old business on the market. The tightly held company had been buying and building since the 1930s, and its portfolio came with 67 parcels containing two million square feet of retail, industrial and office space. It also included 3,300 acres of undeveloped land in Broward, along with lesser holdings in Pinellas, Palm Beach, Lake and Orange counties.
Since the purchase, Swerdlow's 100-person organization has been jiggering with the Hollywood Inc. portfolio ? renovating or replacing the obsolete, selling unwanted assets to raise capital for other acquisitions and developing choice parcels with retail and office buildings.
Much of the portfolio was located in established areas, which meant that Swerdlow had to win government approvals for new construction ? no easy matter. "Sure it's challenging," Swerdlow says. "But the best land happens to be in the eastern part of the region, close to the ocean. There's a reason why people built there first. But it's an area that's really lacking in the kind of retail development that you find in the newer places.?
This point is illustrated by Oakwood Plaza, Swerdlow's high profile project which the industry had perceived as a big gamble in 1992 when he undertook it. Swerdlow assembled five parcels on a mile-long stretch facing I-95 in South Broward, most of it zoned for office and warehouse development. Swerdlow didn't see those uses as winners. Instead, he wanted to build a 1.1 million-square-foot power center ? real estate shorthand for a collection of major free-standing retail operations. He made the rounds to politicians and bureaucrats and won approval to build the largest open-air retail center in Florida.
"When it comes to power centers, Michael Swerdlow created a niche that's very difficult to duplicate," says Ezra Katz, president of Aztec Group in Miami, who regularly serves as Swerdlow's financing adviser. "What makes him unique is that he's very well-capitalized, which gives him high credibility with lenders and tenants."
Although his name dominates two massive signs at Oakwood Plaza, facing I-95, Swerdlow seldom solos in his projects. Before coming to Florida, the 53-year-old lawyer-turned-developer, whose speech still resonates with the New York of his youth, was a property liquidation expert. In the 1970s and '80s, he played a big role in the reorganization of such corporate giants as Pantry Pride and Chrysler.
His partners in the Hollywood purchase were leveraged-buyout experts Nelson Peltz and Peter May of Triarc Cos. (who acquired DWG, an investment conglomerate, in 1993 from notorious financier Victor Posner) and Lehman Bros., the investment banking house; the partners remain active in his ventures today.
"Initially, Peltz, May and I take the risks in property acquisition, then the Michael Swerdlow Cos. does the planning and the banks come in when we're ready to build," Swerdlow says.
Boasting an unblemished track record with the banks and strong relationships with national retail giants and equity backers, Swerdlow can structure deals unavailable to competitors. Among them are three major residential projects with 1,700 homes in partnership with Broward County-based Westbrooke Communities
Swerdlow's principal involvement in those projects is in early planning ? his company buys land, obtains governmental approvals and builds roads, while Westbrooke handles construction and sales. "His main thing is retail. He has a real good organization," says Jim Carr, Westbrooke's president.
Several years ago, Swerdlow bought and renovated the Kendale Lakes Mall in southwest Dade County ? his initial venture there. Now he's planning a much larger shopping center with well-connected Dade developer Armando Codina. The project, an outlet mall and entertainment complex west of Miami International Airport near Florida's Turnpike, will cover about 100 acres. It's the retail component of a larger, mostly industrial development that Codina plans to build.
"Mike's done very well with retail and this is a very sophisticated project,? Codina says. "He has the understanding and the relationships to do this sort of project. He's a natural for it.?
Another Swerdlow/Codina venture may be in the offing. It's 278 acres that Swerdlow owns between Port Everglades and Fort Lauderdale-Hollywood International Airport. Swerdlow calls the waterfront tract "the best piece of industrial land in Broward, if not in America." He would like to build a 600-slip marina, a 375-room hotel, 400,000 square feet of office space and nearly 3 million square feet of industrial buildings on the site. But the project is on hold for now while Broward County decides whether to acquire the property for its own purposes through eminent domain.
Despite interests as far away as Tampa, Swerdlow says his core operation will continue to focus on South Florida's developed coastal areas. One example: the 280,000-square-foot Brickell Station retail and entertainment complex in downtown Fort Lauderdale, which his company plans to build next year and open in 1998.
"The older cities need help, and they're filled with opportunities," Swerdlow says. "We'll continue to look for land and opportunities right here. I think we'll find plenty."
