In separate deals, two realtors have current plans to propose the construction of new high rise condos in Miami Beach. These two locations would be named Residences at the Miami Beach Edition and Deauville Hotel Beach Resort. Together, the two proposed developments would boast 440 units. This would bring the total amount of proposed unit developments to 13,315 since 2007, when the housing market bubble first burst.
In the 5 years since the market first crashed, one new tower has been constructed, and 12 high rises are currently in the construction phase. For the Miami Beach pre construction projects, the Residences at Miami Beach Edition would call for an 11 story tower to be built, with 26 of its units being designated as part of a resort complex. On the 4.2 acre site, there would be plans for at least 3 towers to be built.
In June of 2010, the developer of this project purchased what was formerly known as the Seville Hotel for approximately $57.5 million. The Seville Hotel was originally constructed in 1955. Prior to the housing market crash, the hotel was going to be revamped and reopened as resort under the Ritz Carlton flag.
To the north of Miami, on one of its barrier islands, building proposals for a 20 story high rise with an estimated 412 units are currently in production. The developer of this project is Deauville Associates LLC. They are currently seeking approval from the government to build this new high rise tower. Prior to this, they have sought and received approval to build a tower that would hold 150 condo units, but this new, more ambitious project has replaced the old one. Approval for the project will take several months to seek out.
Since 2003, approximately 49,000 new units have been created in South Florida. Of these numbers, 94% have been purchased by foreign investors. While there are currently many new plans in place, if approved, most of these new projects are not scheduled for completion until 2014. This is the projected date for when the last of the unsold units from the prior Miami real estate boom will be sold. As of right now, it is not clear how these proposed towers will be built. Obtaining construction financing has never been more challenging for developers, and there is the uncertainty principle regarding who exactly will purchase them.
In an effort to surmount future financing problems, developers of these new high rises are requiring prospective buyers to pay deposits, some as high as 80% of the unit’s price, in phases. By comparison, before 2006, developers were only requiring deposits of 20% from buyers. Real estate agents and firms will certainly be casting an eye towards these new developments with baited breath. The Miami housing market is only just now beginning to show signs of recovery from the previous economic depression, and if the market were to become oversaturated with new housing again, it could spell potential disaster.