By Sunny Isles Real Estate Expert on February 11th, 2012
The latest report from Miami Herald (http://www.miamiherald.com/2012/02/08/2631956/construction-spending-finally.html) indicates that the construction spending in South Florida rose for the fourth month in a row in Broward County in November 2011, joining Miami-Dade County as areas with sustained growth in the real estate sector. “We’re seeing a lot of custom-home building,” said Bernie Navarro, head of the Latin Builders Association. “You see it in Key Biscayne and Coral Gables and Pinecrest. Those places had fallen to zero. Now they’re back on.” While construction employment is falling, the losses are more narrow than previously. “It’s going better than I expected six months ago,” said David Denslow, an economist at the University of Florida. “Remember, six months ago we were worried about a double dip. Now all of the evidence is pointing the other way.”
The Hollywood and Hallandale Condo resales
jumped in 2011 as well. Buyers purchased an average of 140 condominium units per month in the Hollywood and Hallandale Beach areas showing an increase in 2011 of nearly 20 units per month from 2010. This is due to the influx of investors chasing discounted condo resales that can be leased out to tenants who are willing to pay higher rents.
Latest report indicate that office vacancy in Miami-Dade County was at 19.1% at the end of 2011, according to data from CBRE Group’s Florida Market Perspective 2011. There was a total of 44.1 million rentable square feet in the county, and 8.4 million vacant. Last year saw net absorption of 64,238, with 359,630 square feet under construction, with the average asking lease rate in the county at $30.32. “The Miami office market has gained strength during 2011 with tenant activity picking up,” said Carter Hopkins, first vice president at CBRE. “The market should continue to strengthen in 2012.”
In addition to single family homes in Miami
the pre-construction condo sector is also on the rise. Fueled by steady pre-sales at the nearby Apogee Beach Hollywood condo, Jorge Perez of the Related Group is planning a new 31-story tower with condo and hotel units fronting the Intracoastal Waterway in the Hollywood nad Hallandale Beach coastal market of Southeast Broward County.
Despite the unsold inventory, the Related Group broke ground on the 23-story Apogee Beach condo tower on the sand just north of Hallandale Beach Boulevard in December 2011. As of Jan. 30, 2012, buyers have committed to purchase 41 out of 49 units in Apogee Beach project, according to company marketing material.
The path to development for the proposed Beachwalk tower – a few blocks west of the Apogee Beach project – is shaping up to be a bit more complicated initially. The proposed Beachwalk tower – which would stand 305-feet high with 84 residential units and 432 hotel rooms. Beachwalk is the 22nd project to be proposed east of Interstate 95 in South Florida. If they are all built, the projects would add nearly 4,400 units into a market that had 4,200 developer units unsold at the end of last year.
A Related affiliate bought the Beachwalk development site, home to Manero’s Steakhouse for five decades, for more than $2.9 million from TD Bank in May 2011. The Beachwalk project is slated to cost $60 million to construct and have a market value of $80 million at completion.
Related is also planning to start construction in two weeks on its MyBrickell condominium in Miami. To date, about 80 percent of the 192 units are under contract, with buyers paying a 20 percent deposit, the company said. It would be the first new condominium project to break ground in downtown Miami in several years.
Developers seeking to launch new condo projects are focusing particularly on the high-end market, which continues to dominate because of the ability of its prospective buyer pool to pay cash for units. The 70-unit Bellini Williams Island – a high-end condominium in Aventura’s William Island recently broken ground.