Cheaper Land Results in the Redevelopment of North Miami Beach

By Sunny Isles Real Estate Expert on April 13th, 2016

Miami commercial real estate

The blue-collar aesthetics of North Miami Beach, including the mid-rise apartments and traditional shopping centers found down Biscayne Boulevard is about to see a significant facelift. More and more luxury condo developers are scooping up the vast areas of land that are available in this area to develop new, luxurious high-rise buildings, as well as mixed-use projects. This is all in hopes that this development will lure in new buyers who are searching for great deals near Sunny Isles Beach and Aventura.

Projects “In the Works”

Currently, there are about 8,000 new rental units and condos being planned and presold on a stretch of Biscayne Boulevard that lies between the Northeast portion of 151st Street and Northeast 176th Street.

Thanks to lower land prices, developers are coming to this intercostal area, which is allowing them to build units that are more reasonably priced, but also close to the water. Another appealing factor is that they will soon be serviced by the Tri-Rail commuter train, which will be making passenger stops at 163rd street as soon as 2018.

Appealing Real Estate in Miami

A number of developers are also receiving encouragement to build along the intercostal area of North Miami Beach, which recently passed all new zoning regulations last March, which allow for higher density projects for the Biscayne Boulevard area. Please CLICK HERE to see Miami commercial real estate opportunities.

In the past few years, developers have begun to actually build, or announce their intentions to build, new condo towers, as well as mixed-use projects. Last February, the Plaza Group completed the first of the two buildings that are making up the Marina Palms project. Each of the towers is 25 floors and together offer 468 units. Other features are a yacht club and marina that provide 112 boat slips. Currently, about 80 percent of all the units in the south tower are sold, and closings have started for the recently completed north tower.

Additional Developments Coming Soon

Another new development occurred in August, with Key International and 13th Floor Investments closes on a deal worth $30.5 billion to purchase land along the Biscayne Boulevard corridor. This purchase will be the home of a twin-tower condo, named The Harbour. The 32 story buildings will include 425 total units and about 70 percent of them have been sold currently. These range in size from 2,442 down to 1,032 square feet and can be purchased for between half a million and $1.2 million.

Real estate in this region is continuing to sell and be developed, which is helping to attract a higher-end buyer to the area, who may be trying to escape the higher prices found in nearby Miami Beach. There are several condo projects in the works and quite a bit of the land along Biscayne Boulevard is spoken for and being developed in the near future. There is no question these luxe and posh condos and apartments are going to attract a higher caliber of buyer, allowing developers to flex their creative muscles while creating upscale units for those who appreciate the finer things.

According to Economist, Miami Real Estate Getting Close to Peak

By Sunny Isles Real Estate Expert on April 9th, 2016

Four Seasons Miami for sale

According to a national economist who spoke at the Four Seasons Hotel – www.sunnyislesmiamirealestate.com/Downtown-Miami/Four-Seasons, the majority of Miami’s real estate sectors are currently at, or about to reach their peak levels.

While the majority of other real estate sectors across the nation are positioned to expand, there are a number of local markets that have currently seen quite a bit of growth, including Miami and according to Hugh Kelly a clinical professional and member of the Counselors of Real Estate, it is about time to start playing defense.

Existing data has suggested that there is still some room for the Miami office market to grow, but it also shows that the apartment and hotel sector have reached the peak. Rental and industrial sectors in Miami are getting close to peak levels, as well.

Monetizing Gains in Miami Real Estate

When it comes to ensuring those gains are preserved and monetized, if possible, there are a number of things that must be considered. For example, is it a hold or sell strategy? If acquiring it is important to base a purchase on existing cash flow, rather than future appreciation. Thinking defensively will help a person figure out where they stand in this cycle and ensure that it runs in their favor, rather than reacting to the cycle as it is turning.

However, most trends are favoring Miami in the long-term. For example, Miami is considered to be a 24-hour city, which is a location that tends to be extremely beneficial for real estate investors who are in it for the long term. Also, financial markets are currently going through a volatile period, which will cause an increase in the flow of cash toward the real estate, making it what is considered a “safe haven.”

In many cases, the reasons above are why gateway cities (such as Miami) do so well in regard to foreign capital.

Current Challenges

However, because of increasing capital rates, interest rates and rises in regulations, there has been a deceleration in regards to international capital flows. This is going to result in some marginal deals falling apart across the nation. This results from the capital pool being deep, but not limitless.

The bottom line is, if an investor knows what they are doing and remain awake, knowing when to play defensively and offensively, they will do fine in the US real estate market. Also, there is not much talk of major corrections in the majority of hot real estate markets, except for some places that are extremely overpriced and saturated, such as Manhattan

The fact is, even in hot markets, building 5,000 apartment units that require buyers at $10 million or more will experience a thinner customer base.

Future Outlook

With the foreign currencies dropping steadily, it is believed that Miami may be heading for a price correction. It is only a matter of time before an investor from South America sells their units for under market value. Also, there are quite a few residential units being constructed. This may eventually lead to an oversupply of the market from a residential standpoint.

The Real Estate Cycle in Miami for 2016

By Sunny Isles Real Estate Expert on April 5th, 2016

Miami Beach condos for sale

Even though there is quite a bit of confidence among developers in Miami that the real estate market will not face much of a downturn during 2016, there are some experts who are still cautioning that the sales are going to continue to fall. This may result in some type of mild recession when December rolls around.

Prices are likely going to continue to go up – (see Miami Beach prices for condos for sale) and appreciate during the first portion of the year; however, at a rate that is much lower than usual. During the last portion of the fiscal year, the prices will likely flatten, due to an increase in inventory, as well as a slower demand from the buyers in Miami.

The Selling Trends in Miami

According to Ugo Colombo, the CEO of the CMC Group, when condo sales begin to move slower, it is a sign of a real estate market that is healthy. He also stated that this means that the market is able to level off at rates that make the progression sustainable. There is no realistic way to continue to sell 100 units each month. Currently, a healthy balance is present in the market regarding supply and demand.

Since the middle portion of 2014, the increase of foreign buyers helped to impact the condo boom. This began directly after the recession in 2008 but has now has begun to taper off because of the reduced value of foreign currency compared to the value of the U.S. dollar. However, Colombo stated that the real estate market in South Florida has gotten so diverse that it is able to successfully weather the economic issues in countries where a number of developers cull their buyers.

Foreign Investments Increasing

There are a number of people from the Middle East, Asia and Europe who are interested in buying who are new to the area, having never made a purchase in the past. The Brickell Flatiron condo project is also beginning to experience more steady sales from buyers that hail from the Caribbean, Mexico, Colombia and even domestic markets, such as New York.

The Melo Group’s Carlos Melo, which has currently developed condo and apartment projects in the Edgewater area, as well as the Arts & Entertainment District stated that there will be a consolidation seen in the South Florida real estate market for 2016.

Is an Overextension in the SoFla Condo Market Coming?

The most recent statistics that are available have indicated that the condo market in South Florida is starting to see the struggle associated with overextension. According to the report from the Association of Miami Realtors, there was a total of 14,770 condo transactions throughout November, which was down from the 17,142 that were seen in the same period the previous year.

With the sales slowing down, the total number of condo buildings that are planned or being constructed has continued to increase. There are plenty of condo towers being built currently and a number that are still in the planning and proposal phase, which means that they are likely to be developed and completed in the next few years.

Home Sales in Miami Breaking Records for 5th Year in a Row

By Sunny Isles Real Estate Expert on March 28th, 2016

Miami Beach homes for sale

Before December, the area of Miami was on track to break the all-time home sales record with almost 13,000 homes sold. For the past five years, the Miami-Dade area has put up a home sales record that it continues to beat, year after year.

When you take a look at the sales figures that were posted in November, there is no question that this area is on track to do it, yet again.

In the previous month alone (November) the Miami-Dade area saw a total of 907 single family homes sold – see website for recent Miami home sales. This brings the total for the year to an impressive 12,857 – just through the month of November.

Setting New Records

The record for the 2014 calendar year was 13,521, which means that it will not be impossible to reach and overcome. This actually equated to 21 homes sold each day, or one home per hour for the entire month of December.

This impressive sale momentum is not going to end anytime soon, either. This trend is expected to continue moving strong well into 2016, with more developments being offered and more homes coming available.

Also, the median sales price for the single family homes in the Miami-Dade area were $274,900 back in November, which was up a total of 12.2 percent from the previous year. For the condos, the prices increased by to an average cost of $203,000, which represents a seven percent increase when compared to the same period in the previous year.

Declines in some Real Estate Sectors

Even though they are nearing the record, the residential market for the Miami-Dade County is still seeing some declines. For example, the sales that were posted for November by the Miami Association of Realtors was down by 6.7 percent when compared to the year over year numbers for the single family homes in the area. However, the number of new listings being sold is still going up. In fact, the total number of new listed single family dwellings that were listed during November was up by 3.5 percent to 1,785 from the previous year’s listings from November of 1,725.

The Thriving Condo Market

However, there is another side. The condo market in Miami-Dade has sped up in the previous months and the sales are going up with more units available than ever before. The sales for the current condos for the month of November increased by 1.9 percent from last year and jumped from just 1,077 total closings to a total of 1,097 closings this year.

There is no question that the number of new listings for condos in the Miami-Dade area is going to continue to increase. There are at least 11 projects in the planning or construction phases, which equates to almost 4,000 new units, coming in the next five to 10 years. While the increase in condos from the previous month was only 12.2 percent, this is a trend that is going to continue for the foreseeable future. While these condos are coming in quickly, they are also highly sought after, which is helping to strengthen the economy.

Home Prices in Miami Up – South Florida Construction Down

By Sunny Isles Real Estate Expert on March 24th, 2016

Miami homes for sale

Compared to February 2015, developers in South Florida signed fewer construction contractors. This is the result of a drop-off in residential building.

According to a report from Dodge Data and Analytics, there was $405 million new residential contracts during the month of February, which represents a reduction of 60 percent from the $1.016 billion that were signed in the same month of 2015.

However, non-residential contracts were up by 17 percent during the same period of time. The construction spending totals from everything from churches to government offices reached about $289 million during November, which was up by $246 million from the previous year. The construction contracts that were signed in the month of November 2015 was $694 million, which is down by 45 percent from the $1.26 billion that was seen in November 2014.

The Beginning of the Decline

This falling trend started in October 2015, which was the month when here were also a number of significant cuts in residential building contracts. However, even with the reduction, the spending totals are still considered to be on track for outpacing 2015. Approximately $8.9 billion is being spent on building from the period of January to November, which is a growth of two percent compared to the $8.7 billion that was spent in the same months during 2015.

Continuing Trends

November also marked another month of increasing home prices in Miami Dade County – click here to see Miami homes for sale as well as sold history. This includes information in regards to sales for both distressed and non-distressed properties. What was discovered was that the prices had increased by 7.6 percent from 2014 to 2015, which was considered a substantial jump, even though the appreciating prices have begun to slow down recently.

From the months of October to November the home prices only increased by 0.5 percent, which means they remained steady.

Contributing Factors

There are a number of factors that impacted this, which included a strong demand, as well as a tight supply in a number of markets. These are all factors that have begun to contribute to the long running increase in prices and home equity, which is ideal for homeowners. However, on the flip side, the prices have outstripped some incomes for a number of years in several regions. This means in 2016, affordability is a more important factor in regards to home sales in some markets.

The overall home prices in the state of Florida, in its entirety, have actually outpaced the Miami-Dade area, which is where the most expensive homes in the state can be found. Florida witnesses an increase of 7.9 percent in the price of homes year-over-year.

Across the nation, home prices saw a similar amount of growth – the cost of homes in the U.S. rose by 6.3 percent year over year in November, and a total of 0.5 percent from the period of October to November.

Continuum – A Towering SoFi Partnership

By Sunny Isles Real Estate Expert on February 16th, 2016

Continuum Miami Beach

South Beach is one of the most desirable locations in the United States, both for new residents and vacationers. With some of the world’s best high-end brand and boutique shopping, a thriving culinary scene, staggering beaches, an energetic nightlife, historic architecture, and a compelling arts and culture scene, the activities and opportunities in SoBe are endless for richly cultured and well-rounded luxury living. When choosing a luxury condo in South Beach, location just might be the most pivotal aspect of starting your new chapter in the best way possible, and the Continuum Towers are unrivaled in location value.

Location

The Continuum and Continuum II towers – CLICK HERE to view the site – are a pair of towers on the southeastern-most tip of South Beach, with the North Tower (Continuum II) situated in the heart of the prestigious South of Fifth neighborhood. They comprise the largest ultra-luxury condo complex on the oceanfront, and they offer unparalleled views to their residents. Both towers overlook the Atlantic, Fisher Island, and the Port of Miami, and the front lawn beyond the complex’s gatehouse sweeps toward over 1,000 feet of fine white sands and oceanfront access.

Whichever tower you choose, you will be steps away from some of the city’s most seductive features and attractions. Joe’s Stonecrab, Smith & Wollensky, Nemo, and other culinary landmarks of the South Beach community are within walking distance, as are golf courses, quality boutiques, marinas, and much more. But such direct access doesn’t impede your private recreation – the towers share twelve acres of coveted beachfront land.

The Towers

Both towers were designed by the acclaimed Sieger-Suarez Partnership – the first built in 2002 and the second built in 2007 on the last untouched piece of property in the district. Both towers feature valet services; security personnel; and pool, fitness and spa access, as well as a shared, 12-acre resort-style space.

Continuum I South offers 15 different residence floorplans over 318 units on 42 stories of luxury units. Your options range from 1,200-4,000 square feet, excluding the 7,800 square foot penthouses, and all layout boast 10-foot ceilings and wrap-around balconies. The four-story fitness center and spa offers extensive access to fitness equipment and treatment rooms, a rooftop lap pool, a private tennis club with three championship courts, and a soul-pampering luxury spa experience. The views of the Atlantic, of Fisher Island, and of the Intracoastal waterway are stunning.

Continuum II North is a 38-story, 203-unit tower that completed the unmatched Continuum South Beach development. The North Tower’s floor plans feature slightly more customization to meet a variety of needs and tastes, such as spacious kitchens, over-sized master bed and baths, and more. Continuum II is also a more modern experience, featuring a smart-building interface to help residents connect with the concierge, valet, and other services. Its design concept is that of a gated resort, featuring lush landscaping, pools, and gardens for prime relaxation and recreation.

You won’t find a more enviable location than the highly sought-after, oceanfront Continuum South Towers, and with this kind of ocean proximity, the access to other community landmarks and activities is a marvel as well. Whichever tower you end up in, you will find a centralized, customized paradise that is a perfect fit for your new South Beach life.

For more information on purchasing your dream condo at the Continuum South Beach, please visit OUR WEBSITE or call One Sotheby’s International Realty Office at (305) 336-0457.

South Florida Real Estate Trends: What to Watch for in 2016

By Sunny Isles Real Estate Expert on February 2nd, 2016

Miami real estate for sale

In virtually all industries, January is the time to look into the future and make a prediction regarding what the next 12 months has in store. This allows businesses and industry leaders to take the right steps so they can capitalize on the trends that are anticipated.

If you are interested in the South Florida real estate market (view website here), then the trends to watch for in 2016 that are highlighted here.

The Rental Market will Start to Stall

After the 2007 crash of the condo market in South Florida, one of the main benefits that residents saw was cheap rental rates. This was the result of easy financing and overbuilding. At that point in time, owners of new construction were converting condos and slashing lease prices to help and attract tenants, which would generate more revenue. When the units were inhabited, the economy began to stabilize.

This also resulted in landlords increasing prices at an aggressive pace to get back some of the money that was lost. The higher rental rates that are now seen in South Florida have resulted in quite a bit of new construction in 2015 and this is a trend that is going to continue for, at least, the next three years. With more rental units available, it will likely mean lower costs for rent in the near future unless the economy in South Florida adds an industry that will result in higher paying jobs.

Increase in Real Estate Commissions

Due to the supply of resale and preconstruction condos in Miami being high, developers are at a point where they need and want to sell the planned and existing units. The last element that most are willing to revise is the price. Watch for commissions in the real estate market to increase in 2016 thanks to an early attempt to sell the units prior to having to reduce prices.

Cancellation of Proposed Projects

Since the current real estate cycle started in 2011, the plans for almost 20 new condo towers in South Florida, which hold over 2,800 units have been changed. These are projects that were revised for a number of different reasons, which range from the changing market conditions to the developers being able to flip the land to get a big return.

Chances are there are going to be more proposed projects that will pivot if they do not meet the pre-sale requirements.

Financing for Mortgages is Increasing

The current real estate cycle in South Florida has mainly benefited because of the cash investors that are coming in from out of town and buying up the property with the intention of renting them out to the local residents who are unable to purchase due to financial limitations.

The main question that needs to be answered is whether or not 2016 is going to be a time of transition to a period of slower growth for the real estate market in South Florida.

December saw Impressive Home Price Growth for Miami & South Florida Real Estate

By Sunny Isles Real Estate Expert on January 28th, 2016

Miami real estate for sale

While the residential real estate market in South Florida is experiencing a slight battle with the global economic crisis, this has not put a damper on housing prices in the region. These prices are steadily appreciating and there is no end in sight for this upward trend.

The prices for Miami and South Florida homes grew by 8.1 percent year over year in November. This data was gathered from a report published by S&P/Case Shiller.

In Palm Beach County, the median price for pre-existing single-family homes hit $305,000, which was an 11 percent increase from the previous year, even more than the average of 8.1 percent. However, there were several other areas that saw this kind of growth, as well. Broward County had a median home price that was also $305,000, which represents a seven percent increase from the prior year. This was the first time that either of these county’s crossed the threshold of $300,000 since over the summer.

Faster Growth in SoFla

This means that the tri-county area saw a faster pace of price growth than almost all of the remainder of the United States. In fact, the only areas that were ahead of South Florida were Dallas, Texas at 9.4 percent, Seattle, Washington at 9.7 percent, Denver, Colorado at 10.9 percent, San Francisco at 11 percent and Portland, Oregon at 11.1 percent.

It is not the entire economy that is suffering. In fact, the consumer portion, which includes automobile sales and housing, was actually quite strong in the previous year. In fact, this improved economy has provided homebuyers with the confidence necessary to actually enter into the market; however, there are some who have been less than overjoyed with the options available, specifically in the range of $150,000 to $400,000 homes. Thanks to strong sales in the past few years, a large number of listings have been depleted all throughout the region. The current owners are still unable or unwilling to test the market, with some not understanding what they could actually get for their home currently.

Economic Struggles in Miami

However, other parts of the economy are not doing quite as well. For example, businesses in the energy and oil sectors have begun to suffer from the significant drop in oil costs over the past 18 months. The strong buying power of the U.S. dollar is also resulting in slower exports. Unfortunately, the housing market is not big enough to help and offset these weak areas.

In December, the national housing market also saw a number of similar gains. In fact, prices increased by 5.3 percent year over year, which accelerated quite a bit from the 5.1 percent jump seen in October.

To get more information on currently availability, please VISIT OUR WEBSITE

Lions Gate, Domino Sugar, and Goldman Sachs Big Wigs Purchase in Faena House

By Sunny Isles Real Estate Expert on December 21st, 2015

Faena Condo Miami Beach

Faena House, the first of four ultra-luxury condo towers being constructed on Collins Avenue in Miami Beach, represents the ultimate in extravagant living. With its modernized lines and amenities like a state-of-the-art fitness room, multiple pools, beach club, and children’s playroom, it’s no wonder the project has attracted prominent buyers like Lions Gate Entertainment chairman Mark Rachesky.

Rachesky, who also heads MHR Fund Management – a $6 billion investment company – closed on his brand new pad in September, for the tidy sum of $13.5 million. Unit 11-BD now belongs to the entertainment mogul, according to public deed records. Earlier this year Rachesky sold a fifth of his holdings in Lions Gate for a reported $320 million, bringing his stake in the company from 36% to 28%.

An Elite Group

Rachesky joins an impressive group in his purchase at Faena. The chairman and CEO of Goldman Sachs, a global multi-billion dollar investment firm, has also bought into the luxury condo tower. Lloyd Blankfein, along with wife Laura, purchased unit 8-A for $9.5 million. Blankfein became CEO of Goldman Sachs in 2006, after joining the company in the early ‘90’s. According to Bloomberg the investment kingpin is now worth over $1 billion. Blankfein is rumored to have been one of the first buyers in the Faena project.

Yet another unit in the exclusive building solid to Jose F. Fanjul, Jr., manager of Sobe 8-C LLC. The Fanjul brothers, owners of Fanjul Corp., play a major role in the American sugar industry; subsidiaries of the company include Domino Sugar, Florida Crystals, Redpath Sugar, and the California and Hawaiian Sugar Company. Florida Crystals itself has become involved in development, breaking ground last year on a 395-unit project in Delray Beach called Atlantic commons.

The Finer Things

Faena House has been drawing much attention in the real estate world of late, particularly when the $60 million penthouse sold earlier this fall. The 12,000+ sq. ft. residence, which features nearly 10,000 sq. ft. of outdoor space (complete with rooftop infinity pool) was purchased by Citadel CEO Kenneth Griffin.

The rest of the building, while not quite as over the top as the penthouse, still offers the luxuriant beachfront living that is becoming all the rage as Miami developers continue to build up high-end condo inventory in SoFla. Every unit has a wraparound terrace that the developers call an “alero”, floor-to-ceiling windows, marble flooring, Miele appliances, and an automated touchpad that operates the thermostats, lights, motorized shades, and more.

This first completed complex is just the beginning. The developers, a Delaware company led by Alan Faena and Len Blavatnik, now turn their attentions to the construction of Faena Hotel Residence, Faena Versailles Contemporary, and Faena Versailles Classic (see website here). The hotel will feature 13 penthouse residence units, while the Versailles buildings will house 41 and 22 condo units, respectively.
Questions have been raised about whether the projects can attract enough upscale buyers to support such extravagant developments. Considering Faena House was sold out before it even opened, the complex’s future looks pretty bright.

How Miami’s Economy Has Become Dependent on Brazil

By Sunny Isles Real Estate Expert on December 6th, 2015

Miami real estate Brazil

There are more than 44,000 Brazilians living in Miami, not including tourists. Brazilian buying power has increased over the last several years, giving a boost to Miami’s economy. Real estate plays a pivotal role as 11% of all international deals are with Brazilians. They are also known to spend more on average per property according to NAR research.

Miami-Brazil Connection

South Florida by the Numbers is a column that reports real estate statistics in Miami (see Miami real estate website here). This column reported on the “Miami-Brazil Connection” and its future in light of Brazil’s economic downturn.

Here are a few of those statistics:

• Brazil is ranked number one for searching for real estate online in South Florida. In the last 18 months, Brazil has topped the list for all but three months. Brazilians spend the most on South Florida properties, averaging $495,000, compared to other international buyers.

• Brazil’s currency is dropping in the exchange rate. According to the Miami Harold, investors may begin to look elsewhere for properties that are less expensive. Brazil’s currency, the real, has dropped by 30% since last year. The Dow Jones is estimating that Brazil’s gross domestic product will decrease by 1.01% in 2015.

• There is an amazing amount of millionaires coming out of Brazil each week. Twenty-two new millionaires each week and many are finding homes and opportunities in Miami. It was only five years ago that Miami was in the real estate crisis and Brazil’s economy was beginning to grow. In 2015, Brazilians account for most of the cash purchases made in real estate in Miami.

• Giraffas Brazilian Grill has ten franchises in Florida with a goal to bring 150 stores across the nation by 2020. This fast growing company is helping to boost the economy in Miami. Giraffas has given Re/Max Advance Realty the exclusive power to handle lease negotiations, site selections, and market studies, among other tasks crucial to opening franchises during a dramatic growth period.

• The New York-based company, HFZ Capital Group, purchased the Shore Club for $175.3 million. Plans to reopen the hotel and residences are underway. The opening is set for the end of 2017 under the new name Fasano Hotel and Residences. This will be the first hotel opened in the United States by this brand as they currently own and operate four hotels and fifteen restaurants.

Brazil’s Economic Future

Brazil’s economic upturn helped to rebuild Miami after the real estate crisis. However, experts worry that Brazil’s upcoming economic troubles may fall over onto Miami like a domino effect. As President Dilma Rouseff faces impeachment and the economy falls into a recession, the unemployment rate skyrockets in Brazil.

The Miami Harold reports that in the first nine months of 2015, as many as 657,761 people lost their jobs. Even worse, it is forecasted that 1.5 million more Brazilians will lose their jobs in the remainder of 2015.