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Is a Second Downtown Miami Condo Boom on the Horizon?

Categories: Unreal Estate
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Those half-empty condo buildings that once haunted downtown Miami are slowly filling up, thanks in large part to foreign buyers taking advantage of the low prices and weak dollar. Though, you'd be hard pressed to find anyone who thinks that what the area needs right now are tons more condo buildings. Yet, that hasn't stopped developers from making ambitious moves that could spur something of a mini-building boom resurgence.

Earlier this week, The Wall Street Journal profiled Jorge Pérez (sorry, it's behind a paywall), the so-called former "Condo King of Miami." The man who fronts mega-developers the Related Group (a company he co-founded with Dolphins owner Stephen M. Ross) played no small part in fueling Miami's last condo boom, and he also suffered in no small part when it busted. Yet, he still made tons of money and apparently its burning a hole in his pocket.

He's buying up property in areas like Brickell and Omni with plans of breaking ground on yet more condo buildings.

Today, another Wall Street Journal article asks the pertinent question of why in the hell he would do that?

The uptick in sales recently in empty condos seems to be encouraging, and we assume the thought is that by the time new development are completed there will be demand for more inventory.

WSJ also points out that it's pretty cheap to build:
"This is basically the cheapest time to build," says Jay Massirman, a principal with Asentus Real Estate, a boutique real estate financing firm. Also, says Mr. Massirman and others, any projects that get going now will be ready by the time Miami's 5,000-condo glut is cleared. "If you put a shovel in the ground for a condo right now, by the time you're done, you'll be delivering that building five or six years after the last downturn."

When they put it that way, it starts to sound mighty nice, doesn't it?
Perez also claims he has tons of his own money ready to invest, and will require pre-construction buyers to put up more money before he starts building.

Of course Perez's projects, believed to be a building called My Brickell in, you guessed it, Brickell and another building behind the old Omni International Mall, aren't the only developments on the horizon.

There's also plans by other developers for that giant mixed-use megamall in the heart of downtown and a smattering of other condo projects scattered along the Biscayne corridor.

The question remains though whether the market will be back when these projects near completion? And can developers really continue to hedge their bets that foreign buyers will fuel a rebirth, and is that really what we want? And will city hall, now fronted by Mayor Tomas Regalado who ran against his predecessors seeming zeal for unrestrained development, allow it? I guess we'll take the influx of building-related jobs and money and hope for the best in the meantime.

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10 comments
Davidsellsmiami
Davidsellsmiami

Am a Realtor for South Florida and alot of media and news dont have a minimum idea to what the truth of how real estate is building up. In the begining of january 2011 there was 110,000 available for sale in the MLS now there is less than 90,000 in may 2011.  Alot of cash buyers and the truth about foreclosures is that no house is selling for less than the listing price.  3 out of 10 houses listed sell in less than 3 months.  which mean in less than a year all 10 out of 10 houses will sell.  if you want to do the search most of the big websites in real estate like zillow and trulia you could call for a house and 80 percent of a realtor answer will be if is not closed sale is pending sale.

The crash continues
The crash continues

Idiots.Overdevelopment and excessive optimismcaused the crash. We have 57 straight months of declining real estate prices. It will take 10 years to recover.

305pride
305pride

Also, I can't understand why people have a problem with new buildings. Miami has the third largest skyline in the US. Keep building them. They look beautiful at night.

305pride
305pride

The outskirts of Downtown and the Omni area are real shit holes. I work right by there and have to pass by there all the time at night. The city and Perez need to get together and build some type of mall (Brickell village type) by the Arsht Center to go with his new buildings. This will help revitalize the area when you can bring in mass people. After 7 p.m. Downtown is a ghost town. This area is in desperate need MORE of high to mid end stores, restaurants and bars. What better place to go after a Heat game then the new hip place down the street? It is starting to work for midtown. This area could see a lot of growth when the Marlins ball park opens next year. My biggest problem with Miami city government is its inability to think a head into the future.

Matthew Earl
Matthew Earl

Just when you thought Miami couldn't get any worse. The whole condo boom is a plan used to drive and push out all the poor communities in the downtown Miami area. That, and the polarization of the community. Gentrification is modern day racism and its never ending in Miami.

An0nymou$
An0nymou$

".....fueling Miami's last condom boom....." He's in the sex business? Wow...

Matthew Earl
Matthew Earl

The only shit hole is that ugly-as-hell downtown Miami skyline you all call the third best in the nation. Uhhh I think not. You do not have a better skyline than San Francisco, Seattle, Philly, Atlanta, Houston, LA, Minneapolis or even Pittsburgh. A bunch of ugly ass condos built in a couple of years does not make a great skyline. Sorry but Miami has virtually no density, architecture or diversity in its buildings. They all look alike.

Ropes
Ropes

 No condoms for the Jorge Pérez, he's shooting his load all over Miami.

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