A massive mixed-use redevelopment seeks to remake the deteriorated face of Miami’s historically black West Coconut Grove, but longtime residents fear they will be pushed out.
BY ANDRES VIGLUCCI
aviglucci@MiamiHerald.com
The city of Miami appears poised to approve a massive redevelopment project in historically black West Coconut Grove that promises to radically transform its down-at-the-heels main street, by replacing six blocks of vacant lots and rundown apartments on Grand Avenue with multi-story shops, offices, new homes and a major supermarket — the first in the heart of the Grove in decades.
The Grove Village proposal, which will be reviewed Thursday by the City Commission, has sharply divided the West Grove, where some say it will resuscitate a dying neighborhood, while others fear it could gentrify it out of existence.
Developer Peter Gardner, who grew up and lives in Coconut Grove, says the project is as much labor of love as business proposition, noting that the West Grove has long been starved for new investment.
“I was born in the Grove and I live on the same street I grew up on, and some day my grandkids will walk down Grand Avenue, so it’s incredibly meaningful to me to make this the best possible project," Gardner said.
“I’ve watched other areas of Miami get a shot in the arm: Miami Beach got a rebirth, and downtown Miami and Brickell got the same, and most recently South Miami, and I think it’s now time for the Grove."
In four years of planning, Gardner says he has met scores of times with Grove residents, neighborhood groups, pastors and activists. That, city planners say, has led to significant redesigns to ensure the massive project better blends into the surrounding duplex and single-family neighborhoods.
West Grove, one of the oldest neighborhoods in the city, is a long-established working- and middle-class enclave that is home to many descendants of the Grove’s original Bahamian settlers, though it has lost significant population in recent years amid cratering property values, extensive vacancies and a persistent street drug traffic in some areas.
Gardner has also promised to set aside 40 of the project’s planned 257 homes and apartments as affordable housing, and to train and hire local residents for construction jobs as well as the permanent jobs he expects to be generated by the new businesses the project will draw.
Gardner said he is in a position to make good on those promises because his company, Pointe Group Advisors, will manage as well as build the development.
But some activists and residents are skeptical, noting Gardner has spurned requests to guarantee those promises in writing. They also contend that the project won’t come close to replacing the dilapidated but low-cost apartments that have been or would be razed along the six blocks, which take up both sides of Grand from Margaret Street west to Plaza Street.
In effect, the critics contend, the project would extend the reach of the more-affluent, mostly white Coconut Grove into the poorer, black neighborhood.
“It excludes rather than includes the historic residents," Jihad Rashid, director of the Coconut Grove Collaborative, recently complained to members of the city planning and zoning board.
The result, Rashid and others fear, is that long-time residents will be priced out of the neighborhood, erasing the Bahamian heritage that the project’s architecture attempts to echo.
“They’re going to keep the architecture but not the people," said Pierre Sands, president of the main West Grove resident group.
The planning board recommended approval 7-0 after two hours of often-contentious debate and sharp questioning by some members concerned about the impact of new five-story buildings on the single-family homes behind them. Though the developer has purchased and demolished homes on the back sides of the six blocks, some “holdouts" have declined to sell.
City planners say they have ensured those remaining homes are separated from the project by park-like landscaping and that no building entrances will impinge on them. The backs of the new buildings will also sit back from neighboring homes.
“The question is, can this be done sensitively," asked planning board member Patrick Goggings, before concluding the plan represents “a good compromise."
If the commission approves the project and a related package of zoning changes necessary for Grove Village’s extensive mix of uses, Gardner said, the first two blocks to be erected would be the two easternmost.
One, a vacant lot on the south side of Grand where an organic farmer’s market is held regularly, would be anchored by a grocery store and contain some affordable homes at the rear. Across Grand would rise a rental apartment building.
The rest of the six blocks would be built in phases and would include retail and restaurant space, offices, homes and more apartments, as well as a possible hotel.
The project would be approved under an unusual scheme that would effectively lock in the current plan, preventing the developers from seeking major changes in the future.
Because the project was initially submitted before approval of the city’s new Miami 21 code, it was designed under the old code while incorporating many of the new rulebook’s pedestrian and neighborhood-friendly features, including concealed parking garages, with entrances on side streets only, and active storefronts at ground level on Grand.
Read more: http://www.miamiherald.com/2011/11/17/v-fullstory/2505687/miami-city-commission-takes-up.html#ixzz1e5jcskMN
Friday, November 18, 2011
Thursday, October 27, 2011
WalMart Coming to Midtown Miami - October 27, 2011
The discount retailer expects to submit site plans for approval to the city before the end of the year. This is the same location where city officials scuttled a proposed Walmart in 2005.
By ELAINE WALKER
ewalker@MiamiHerald.com
Six years after Walmart first tried to open a store at The Shops at Midtown Miami, the discount retailer is back again and planning to move forward on what would be its first store in the city of Miami.
Walmart Florida spokeswoman Michelle Belaire said the company has a contract with Developers Diversified Realty to buy five acres of land and is working on a site plan to be submitted to the city in the next couple of months. Walmart doesn’t need any zoning change or land use variances for the site, she said.
“We are working with a world-renowned architect to produce a one-of-a-kind Walmart that would be consistent with the design of the area,” Belaire said. “We’re fleshing out the plan to ensure that we meet all the necessary requirements before submission.”
Preliminary plans call for a 155,000-square-foot store with a full-service grocery store, which would be just slightly larger than the center’s existing Target; it would be located on undeveloped property at the south end of Midtown Miami on North Miami Avenue. The store would likely open in late 2013 or early 2014.
This is the same location where Walmart in 2005 had proposed a nontraditional, design with a multilevel parking garage that was shot down by then Miami City Commissioner Johnny Winton and other city officials. At that time, Midtown Miami was still under construction. While the Walmart deal was never officially voted down by city officials, Winton made it clear he didn’t believe Walmart’s “image” was suitable for the project.
“That site is not one we want to be known as a Walmart site,” Winton told the Herald in 2005.
The location was later designated for a JCPenney, but that store never materialized.
This time around Walmart hopes to build a store with a two-level parking garage above, Belaire said. The garage would have at least 600 spaces for free use by shoppers. The design also is expected to include some small retail shops lining the front of the store and opening out to the street, to coincide with Midtown’s pedestrian-friendly orientation, she said. The store would employ up to 350 people.
For years Walmart has been looking at locations throughout Miami’s urban core.
“Miami is a tremendously underserved community for us,” Belaire said. “We know the City of Miami residents shop our stores. Right now they’re leaving the city and coming into our stores elsewhere in Miami-Dade County.”
Walmart would join the lineup at Midtown Miami that includes Target, Marshalls, HomeGoods, PetSmart, Ross Dress for Less and The Sports Authority.
Read more: http://www.miamiherald.com/2011/10/25/2471835/walmart-coming-to-midtown-miami.html#ixzz1bzlhhDxB
By ELAINE WALKER
ewalker@MiamiHerald.com
Six years after Walmart first tried to open a store at The Shops at Midtown Miami, the discount retailer is back again and planning to move forward on what would be its first store in the city of Miami.
Walmart Florida spokeswoman Michelle Belaire said the company has a contract with Developers Diversified Realty to buy five acres of land and is working on a site plan to be submitted to the city in the next couple of months. Walmart doesn’t need any zoning change or land use variances for the site, she said.
“We are working with a world-renowned architect to produce a one-of-a-kind Walmart that would be consistent with the design of the area,” Belaire said. “We’re fleshing out the plan to ensure that we meet all the necessary requirements before submission.”
Preliminary plans call for a 155,000-square-foot store with a full-service grocery store, which would be just slightly larger than the center’s existing Target; it would be located on undeveloped property at the south end of Midtown Miami on North Miami Avenue. The store would likely open in late 2013 or early 2014.
This is the same location where Walmart in 2005 had proposed a nontraditional, design with a multilevel parking garage that was shot down by then Miami City Commissioner Johnny Winton and other city officials. At that time, Midtown Miami was still under construction. While the Walmart deal was never officially voted down by city officials, Winton made it clear he didn’t believe Walmart’s “image” was suitable for the project.
“That site is not one we want to be known as a Walmart site,” Winton told the Herald in 2005.
The location was later designated for a JCPenney, but that store never materialized.
This time around Walmart hopes to build a store with a two-level parking garage above, Belaire said. The garage would have at least 600 spaces for free use by shoppers. The design also is expected to include some small retail shops lining the front of the store and opening out to the street, to coincide with Midtown’s pedestrian-friendly orientation, she said. The store would employ up to 350 people.
For years Walmart has been looking at locations throughout Miami’s urban core.
“Miami is a tremendously underserved community for us,” Belaire said. “We know the City of Miami residents shop our stores. Right now they’re leaving the city and coming into our stores elsewhere in Miami-Dade County.”
Walmart would join the lineup at Midtown Miami that includes Target, Marshalls, HomeGoods, PetSmart, Ross Dress for Less and The Sports Authority.
Read more: http://www.miamiherald.com/2011/10/25/2471835/walmart-coming-to-midtown-miami.html#ixzz1bzlhhDxB
Friday, October 21, 2011
South Florida Rents Rise as International Buyers Continue to Invest in Local Housing - October 21, 2011
As more homeowners turn into renters because of the foreclosure crisis, investors are buying distressed properties and converting them to rentals to meet the demand.
By TOLUSE OLORUNNIPA
tolorunnipa@MiamiHerald.com
By choice or by force, more and more people in South Florida’s foreclosure-ridden housing market are renting, rather than owning, their homes.
In an ironic twist on economics, that dynamic is actually helping the resale market. According to sales reports released Thursday, South Florida is on track to set a new sales record this year.
The reason: investors.
The majority of today’s homebuyers are not first-time owners or growing families, but opportunistic investors. International buyers and locals with cash are making money in the region’s distressed market by buying up foreclosed homes and turning them into rentals.
Homeowners who have been foreclosed upon, and those who either can’t or won’t buy in this economy, are flooding the rental market with unprecedented demand.
“I talk to a couple investors all over South America and they tell me they buy these condos and it takes them about a week to rent them,” said Craig Studnicky, principal of Miami real estate firm RelatedISG. “Each and every month, the rents are going up.”
Spurred by investor activity, South Florida homes sales rose again in September, according to new data by the Miami Association of Realtors. Sales were down, however, compared to last month.
There were 848 single-family home sales in Miami-Dade County in September, up 46 percent from the same month in 2010, but down 10.8 percent from August. Existing Miami-Dade condo sales reached 1,319, up 58 percent on a year-over-year basis, and flat compared to the previous month.
In Broward County, single-family home sales reached 1,079, up 11 percent year-over-year but down 8.9 percent from the month before. Condo sales totaled 1,281, up 6 percent from the previous year and down 8.4 percent from August.
All-cash buyers, mostly investors, accounted for 63 percent of all sales. Those investors are gravitating towards distressed properties, which make up about 60 percent of home sales and trade at deep discounts.
In September, median prices for condos rose 17 percent in Miami-Dade to $116,000 and rose 3 percent in Broward to $71,900. Single-family home prices fell 6 percent in Miami-Dade to $176,600 and fell 7 percent in Broward to $188,800.
When the housing market began its historic descent four years ago, Miami-based real estate firm The Solution Group shifted its traditional sales model to a three-step investment model: buy cheap, fix up, rent out.
The company buys condos, townhomes and single-family homes that are bank-owned or headed for foreclosure, paying an average of $60,000, said Camilo Lopez, CEO. After fixing up a home and securing a tenant, the company usually sells the property to an international investor looking to diversify portfolios with South Florida real estate.
“Before, [rentals] were zero percent of our business,” said RJ de Varona, chief operating officer of The Solution Group. “Now, they’re absolutely 150 percent. The biggest rental market is homeowners who have lost their homes in foreclosure.”
More than 100,000 South Florida homeowners have lost their properties to foreclosure since 2007, and many of them ended up as renters. Additionally, a cultural shift towards renting and the difficulty of obtaining financing in this economy have pushed occupancy rates up at apartment complexes and rental homes.
Occupancy rates in South Florida are now above 95 percent, and rent prices have risen between 3 and 7 percent this year, according to research by Texas-based MPF Research.
With at least 160,000 homeowners either in foreclosure or so far behind on payments that an eventual foreclosure appears inevitable, the region’s rental market is likely to see growing ranks of new renters for the foreseeable future. As a result, more so-called “vulture investors” will seek hefty profits by buying up distressed property and converting them to rentals.
“We bought a two-bedroom in Kendall in May for $50,000. We invested $10,000 in repairs, and then rented the unit for $1,200 [a month],” said de Varona. “We just closed the sale of the unit for $95,000.”
The international investor who purchased the home is making a 7.5 percent return on his investment, de Varona said.
In addition to the rising rental market, international investors are to drawn to South Florida real estate because the U.S. offers greater legal protection for foreign land owners than many other countries, and because some homeownership can make it easier to obtain a U.S. visa.
Growing investor appetite is driving sales for condos and single-family homes back to the boom time levels of 2005 and 2006. In Miami-Dade County, for example, total sales are expected to reach 29,000 this year, more than 2005’s total.
Still, some warn that the housing market is undergoing a dangerous shift. In effect, international landlords are taking the place of would-be first-time homeowners and move-up families, said Jack McCabe, CEO of McCabe Research and Consulting in Deerfield Beach. “Many Americans that previously had the opportunity to build wealth through the forced savings involved in buying a home are not going to have that opportunity,” he said. “Prices have come down to where [homes] are affordable again, but many American buyers are not able to take advantage of current prices. They aren’t able to qualify for a mortgage, and it’s a cash-buyer market.”
Despite the recent value declines homeowners have experienced during the recession, homeownership has proved a smart investment over the last several decades, with home values rising about 5.4 percent annually on average. The growing crop of renters is not able to benefit from that investment.
Additionally, the idea of saving money as a renter so that you can put together a down payment in the future is not viable for many cash-strapped South Floridians trapped between high rental rates and low wages.
Read more: http://www.miamiherald.com/2011/10/21/v-fullstory/2464773/south-florida-rents-rise-as-international.html#ixzz1bR9CBNoG
By TOLUSE OLORUNNIPA
tolorunnipa@MiamiHerald.com
By choice or by force, more and more people in South Florida’s foreclosure-ridden housing market are renting, rather than owning, their homes.
In an ironic twist on economics, that dynamic is actually helping the resale market. According to sales reports released Thursday, South Florida is on track to set a new sales record this year.
The reason: investors.
The majority of today’s homebuyers are not first-time owners or growing families, but opportunistic investors. International buyers and locals with cash are making money in the region’s distressed market by buying up foreclosed homes and turning them into rentals.
Homeowners who have been foreclosed upon, and those who either can’t or won’t buy in this economy, are flooding the rental market with unprecedented demand.
“I talk to a couple investors all over South America and they tell me they buy these condos and it takes them about a week to rent them,” said Craig Studnicky, principal of Miami real estate firm RelatedISG. “Each and every month, the rents are going up.”
Spurred by investor activity, South Florida homes sales rose again in September, according to new data by the Miami Association of Realtors. Sales were down, however, compared to last month.
There were 848 single-family home sales in Miami-Dade County in September, up 46 percent from the same month in 2010, but down 10.8 percent from August. Existing Miami-Dade condo sales reached 1,319, up 58 percent on a year-over-year basis, and flat compared to the previous month.
In Broward County, single-family home sales reached 1,079, up 11 percent year-over-year but down 8.9 percent from the month before. Condo sales totaled 1,281, up 6 percent from the previous year and down 8.4 percent from August.
All-cash buyers, mostly investors, accounted for 63 percent of all sales. Those investors are gravitating towards distressed properties, which make up about 60 percent of home sales and trade at deep discounts.
In September, median prices for condos rose 17 percent in Miami-Dade to $116,000 and rose 3 percent in Broward to $71,900. Single-family home prices fell 6 percent in Miami-Dade to $176,600 and fell 7 percent in Broward to $188,800.
When the housing market began its historic descent four years ago, Miami-based real estate firm The Solution Group shifted its traditional sales model to a three-step investment model: buy cheap, fix up, rent out.
The company buys condos, townhomes and single-family homes that are bank-owned or headed for foreclosure, paying an average of $60,000, said Camilo Lopez, CEO. After fixing up a home and securing a tenant, the company usually sells the property to an international investor looking to diversify portfolios with South Florida real estate.
“Before, [rentals] were zero percent of our business,” said RJ de Varona, chief operating officer of The Solution Group. “Now, they’re absolutely 150 percent. The biggest rental market is homeowners who have lost their homes in foreclosure.”
More than 100,000 South Florida homeowners have lost their properties to foreclosure since 2007, and many of them ended up as renters. Additionally, a cultural shift towards renting and the difficulty of obtaining financing in this economy have pushed occupancy rates up at apartment complexes and rental homes.
Occupancy rates in South Florida are now above 95 percent, and rent prices have risen between 3 and 7 percent this year, according to research by Texas-based MPF Research.
With at least 160,000 homeowners either in foreclosure or so far behind on payments that an eventual foreclosure appears inevitable, the region’s rental market is likely to see growing ranks of new renters for the foreseeable future. As a result, more so-called “vulture investors” will seek hefty profits by buying up distressed property and converting them to rentals.
“We bought a two-bedroom in Kendall in May for $50,000. We invested $10,000 in repairs, and then rented the unit for $1,200 [a month],” said de Varona. “We just closed the sale of the unit for $95,000.”
The international investor who purchased the home is making a 7.5 percent return on his investment, de Varona said.
In addition to the rising rental market, international investors are to drawn to South Florida real estate because the U.S. offers greater legal protection for foreign land owners than many other countries, and because some homeownership can make it easier to obtain a U.S. visa.
Growing investor appetite is driving sales for condos and single-family homes back to the boom time levels of 2005 and 2006. In Miami-Dade County, for example, total sales are expected to reach 29,000 this year, more than 2005’s total.
Still, some warn that the housing market is undergoing a dangerous shift. In effect, international landlords are taking the place of would-be first-time homeowners and move-up families, said Jack McCabe, CEO of McCabe Research and Consulting in Deerfield Beach. “Many Americans that previously had the opportunity to build wealth through the forced savings involved in buying a home are not going to have that opportunity,” he said. “Prices have come down to where [homes] are affordable again, but many American buyers are not able to take advantage of current prices. They aren’t able to qualify for a mortgage, and it’s a cash-buyer market.”
Despite the recent value declines homeowners have experienced during the recession, homeownership has proved a smart investment over the last several decades, with home values rising about 5.4 percent annually on average. The growing crop of renters is not able to benefit from that investment.
Additionally, the idea of saving money as a renter so that you can put together a down payment in the future is not viable for many cash-strapped South Floridians trapped between high rental rates and low wages.
Read more: http://www.miamiherald.com/2011/10/21/v-fullstory/2464773/south-florida-rents-rise-as-international.html#ixzz1bR9CBNoG
Saturday, July 23, 2011
South Florida Home Sales Continue at Torrid Pace but Prices Still Down - July 20, 2011
Home sales volume increased in South Florida yet again in June, and the first six months of 2011 have been marked by soaring sales and unstable prices.
By TOLUSE OLORUNNIPA
tolorunnipa@MiamiHerald.com
The volume of South Florida home sales continued its historic upward trend in June while prices showed a mix of results driven by investors’ appetite for all-cash deals on distressed properties.
Is the real-estate bucket half full or half empty midway through 2011? It all depends on which view of the market you happen to be taking.
For real estate agents and investors, happy days are here again, as both cash in on the rapid sales pace and international appetite for low-priced properties.
For homeowners and those looking to become homeowners, times are less certain, as home values across the market remain far below their peaks. For homeowners, the stubbornly declining values add insult to injury, as a 55 percent decline from 2006 values has left a landscape of underwater mortgages and foreclosures.
Potential buyers see the low prices as enticing, but tight credit, aggressive cash investors and a rapidly declining supply of available homes can make finding the right buy more and more difficult. Still, some buyers, like North Miami chef Hornel Joseph, are navigating the market to find bargains.
“I saw that the market was down, and now is a good time to buy a home,“ said Joseph, who recently purchased a four-bedroom in North Miami for $150,000. “We got a good deal.”
In Miami-Dade County, resales of single-family homes reached 923, up 35 percent from June 2010 and up 5.5 percent from May, according to data released Wednesday by the Miami Association of Realtors. Condo sales equaled 1,136, up 54 percent from June 2010 and down slightly from May.
Real estate agents sold 1,274 single-family homes in Broward County in June, a 6 percent increase from the year before. Month-over-month, the sales increase was 11.6 percent. In the condo market, Broward saw year-over-year sales increase 7 percent to 1,511. Compared to May, sales slipped 1.7 percent.
Prices were down in Miami-Dade, with the median-priced single-family home price dropping 9 percent to $185,400. Things looked better in Broward, where prices for single-family homes jumped 26 percent to $196,000.
Real estate agents
Agents say they have not been this busy since 2006, when speculators and flippers flooded the market and real estate commissions hit record highs.
If the current sales pace continues through December, 2011 will set a record for the number of homes trading hands in a year. There have been 12,369 home and condo sales through the first six months of 2011, up 79.3 percent from last year and the highest January-to-June total on record.
Mike Pappas, who owns South Florida-based Keyes Realty, said he sees no sign of a slowdown after the busy spring selling season. June was the strongest month for the company in as long as he can remember, and the interest from international investors has kept his offices buzzing.
“We’ve been running hard since March,” he said. “We haven’t had four months like that since 2006.”
Inventory levels have declined rapidly since last year, and the number of homes for sale stands at about 30,000, down from 45,000 last June.
“I’m confident that we’re out of the bust, and on our way to a recovery,” said Pappas.
Investors
Real estate investors are enjoying this market just about as much as local agents. Both individual investors — many from outside of the country — and multibillion dollar investment firms have swarmed to South Florida’s distressed housing scene, looking for steals. In many cases, they’ve found them in the copious foreclosure market.
Miami-based investor group BH III scooped up 175 units at the $355 million Trump Hollywood condo tower in a $160 million bank note sale last year. After buying the note in November, the investors relaunched sales with an over-the-top condo party in January.
BH III says sales so far in 2011 have already topped $100 million, and the investors are well on their way to realizing their costs and making a profit.
“The summer has been very strong,” said Greg Freedman, a partner at BH III, predicting the project could sell out much earlier than the expected 2014 closeout target. “We did not think that the market would have the appetite that it has and we were certainly surprised by the volume of sales.”
For individual investors with cash, the 2011 South Florida housing market has been a free-for-all fire sale, with prices down 55 percent from their peak, back to 2002 levels.
International buyers have the luxury of slashing additional percentage points off already discounted prices, thanks to the strength of some Latin American currencies against the dollar. The Brazilian real, for example, has gained nearly 40 percent against the dollar since 2008.
Sellers
For most everyday homeowners, the fast moving sales, investor activity and international buyers mean little — home prices and values are still falling in much of the market. With nearly half of all South Florida mortgages underwater and plenty of foreclosed homes, the 2011 housing market has been one of continued gloom, although there are signs that the worst may have passed.
Median prices for single family homes were down 9 percent in Miami-Dade to $185,400, and condo prices fell 7 percent to $119,800. In Broward, single-family prices wiped out last month’s 18 percent decline by climbing 26 percent to $196,000. In the condo market, median prices reached $76,900, up 11 percent from last June but down 4.4 from May.
Home prices have struggled to rally because of the large number of distressed homes, which make up 57 percent of all sales.
Robert Berrios put his Miami home on the market three years ago and is still waiting for a buyer.
He has cut the price a few times, and said he may be forced to slash even further to drum up interest in the property, which he said he needs to sell before moving his family to the Northeast.
“You have to relist again and lower the price and bite the bullet, and then you get bites,” he said. “When people see the ‘just reduced’ sign, you start to get calls. We’ll probably be doing that soon.”
According to a report by real estate research firm Trulia, nearly one in five home sellers in South Florida have slashed prices this year. The average discount is about 11 percent.
Buyers
There is no $8,000 federal tax credit for first-time homebuyers this year, but prices have fallen more than enough to compensate, and buyers who are in a position to take advantage of the discounts are actively searching for bargains.
But some potential buyers say they are being boxed out of the market by all-cash investors, and many cannot qualify for a loan.
Interest rates, long predicted to rise, have held below 5 percent throughout the year, but banks are scrutinizing potential borrowers’ credit and financial backgrounds before qualifying them for financing.
Joseph, the North Miami chef, was able to get a loan, putting a 10 percent down payment for the home. After renting for six years, he saved up enough for the down payment and had a strong enough credit history to pre-qualify for a mortgage loan.
“It was not too difficult,“ he said. “As soon as I found out that I qualified, I started looking for a house and it took about a month. We’re happy with the price we got—I don’t think the market is going down much more.”
Read more: http://www.miamiherald.com/2011/07/20/v-fullstory/2323130/south-florida-home-sales-continue.html#ixzz1SwvLnXdo
By TOLUSE OLORUNNIPA
tolorunnipa@MiamiHerald.com
The volume of South Florida home sales continued its historic upward trend in June while prices showed a mix of results driven by investors’ appetite for all-cash deals on distressed properties.
Is the real-estate bucket half full or half empty midway through 2011? It all depends on which view of the market you happen to be taking.
For real estate agents and investors, happy days are here again, as both cash in on the rapid sales pace and international appetite for low-priced properties.
For homeowners and those looking to become homeowners, times are less certain, as home values across the market remain far below their peaks. For homeowners, the stubbornly declining values add insult to injury, as a 55 percent decline from 2006 values has left a landscape of underwater mortgages and foreclosures.
Potential buyers see the low prices as enticing, but tight credit, aggressive cash investors and a rapidly declining supply of available homes can make finding the right buy more and more difficult. Still, some buyers, like North Miami chef Hornel Joseph, are navigating the market to find bargains.
“I saw that the market was down, and now is a good time to buy a home,“ said Joseph, who recently purchased a four-bedroom in North Miami for $150,000. “We got a good deal.”
In Miami-Dade County, resales of single-family homes reached 923, up 35 percent from June 2010 and up 5.5 percent from May, according to data released Wednesday by the Miami Association of Realtors. Condo sales equaled 1,136, up 54 percent from June 2010 and down slightly from May.
Real estate agents sold 1,274 single-family homes in Broward County in June, a 6 percent increase from the year before. Month-over-month, the sales increase was 11.6 percent. In the condo market, Broward saw year-over-year sales increase 7 percent to 1,511. Compared to May, sales slipped 1.7 percent.
Prices were down in Miami-Dade, with the median-priced single-family home price dropping 9 percent to $185,400. Things looked better in Broward, where prices for single-family homes jumped 26 percent to $196,000.
Real estate agents
Agents say they have not been this busy since 2006, when speculators and flippers flooded the market and real estate commissions hit record highs.
If the current sales pace continues through December, 2011 will set a record for the number of homes trading hands in a year. There have been 12,369 home and condo sales through the first six months of 2011, up 79.3 percent from last year and the highest January-to-June total on record.
Mike Pappas, who owns South Florida-based Keyes Realty, said he sees no sign of a slowdown after the busy spring selling season. June was the strongest month for the company in as long as he can remember, and the interest from international investors has kept his offices buzzing.
“We’ve been running hard since March,” he said. “We haven’t had four months like that since 2006.”
Inventory levels have declined rapidly since last year, and the number of homes for sale stands at about 30,000, down from 45,000 last June.
“I’m confident that we’re out of the bust, and on our way to a recovery,” said Pappas.
Investors
Real estate investors are enjoying this market just about as much as local agents. Both individual investors — many from outside of the country — and multibillion dollar investment firms have swarmed to South Florida’s distressed housing scene, looking for steals. In many cases, they’ve found them in the copious foreclosure market.
Miami-based investor group BH III scooped up 175 units at the $355 million Trump Hollywood condo tower in a $160 million bank note sale last year. After buying the note in November, the investors relaunched sales with an over-the-top condo party in January.
BH III says sales so far in 2011 have already topped $100 million, and the investors are well on their way to realizing their costs and making a profit.
“The summer has been very strong,” said Greg Freedman, a partner at BH III, predicting the project could sell out much earlier than the expected 2014 closeout target. “We did not think that the market would have the appetite that it has and we were certainly surprised by the volume of sales.”
For individual investors with cash, the 2011 South Florida housing market has been a free-for-all fire sale, with prices down 55 percent from their peak, back to 2002 levels.
International buyers have the luxury of slashing additional percentage points off already discounted prices, thanks to the strength of some Latin American currencies against the dollar. The Brazilian real, for example, has gained nearly 40 percent against the dollar since 2008.
Sellers
For most everyday homeowners, the fast moving sales, investor activity and international buyers mean little — home prices and values are still falling in much of the market. With nearly half of all South Florida mortgages underwater and plenty of foreclosed homes, the 2011 housing market has been one of continued gloom, although there are signs that the worst may have passed.
Median prices for single family homes were down 9 percent in Miami-Dade to $185,400, and condo prices fell 7 percent to $119,800. In Broward, single-family prices wiped out last month’s 18 percent decline by climbing 26 percent to $196,000. In the condo market, median prices reached $76,900, up 11 percent from last June but down 4.4 from May.
Home prices have struggled to rally because of the large number of distressed homes, which make up 57 percent of all sales.
Robert Berrios put his Miami home on the market three years ago and is still waiting for a buyer.
He has cut the price a few times, and said he may be forced to slash even further to drum up interest in the property, which he said he needs to sell before moving his family to the Northeast.
“You have to relist again and lower the price and bite the bullet, and then you get bites,” he said. “When people see the ‘just reduced’ sign, you start to get calls. We’ll probably be doing that soon.”
According to a report by real estate research firm Trulia, nearly one in five home sellers in South Florida have slashed prices this year. The average discount is about 11 percent.
Buyers
There is no $8,000 federal tax credit for first-time homebuyers this year, but prices have fallen more than enough to compensate, and buyers who are in a position to take advantage of the discounts are actively searching for bargains.
But some potential buyers say they are being boxed out of the market by all-cash investors, and many cannot qualify for a loan.
Interest rates, long predicted to rise, have held below 5 percent throughout the year, but banks are scrutinizing potential borrowers’ credit and financial backgrounds before qualifying them for financing.
Joseph, the North Miami chef, was able to get a loan, putting a 10 percent down payment for the home. After renting for six years, he saved up enough for the down payment and had a strong enough credit history to pre-qualify for a mortgage loan.
“It was not too difficult,“ he said. “As soon as I found out that I qualified, I started looking for a house and it took about a month. We’re happy with the price we got—I don’t think the market is going down much more.”
Read more: http://www.miamiherald.com/2011/07/20/v-fullstory/2323130/south-florida-home-sales-continue.html#ixzz1SwvLnXdo
Friday, June 17, 2011
Thursday, June 16, 2011
Renters are Next Victims of Housing Market - June 14, 2011
By Jane Hodges
msnbc.com contributor
Stephan Metelica, a 24-year old charter pilot, shares a two-bedroom apartment with a friend in Chicago’s Lincoln Park neighborhood. The duo split the $1,525 monthly rent, but they were surprised this month when their landlord lease came up for renewal and their landlord asked for a 5 percent increase, to $1,600.
“I was pretty upset about it,” Metelica says of what would amount to nearly $40 more per month per person. “I thought a 5 percent increase was ridiculous.”
Renters, long happy to sidestep the drama homeowners have suffered in the roller-coaster housing market, are now facing their downside of the real estate market’s correction. With apartment and rental housing construction halved in recent years and a wave of former homeowners competing for apartment space with "echo boomers" and other renters, conditions have suddenly ripened for landlords to raise the rent.
Metelica persuaded his landlord to curb the increase, capping his new rent at $1,550. The roommates and landlord have a verbal agreement for that new rental rate, he says, with a new lease signing imminent. But his ability to talk his way out of a bigger rent increase makes him more of an exception than the rule this year, according to experts.
Last year the rental market quietly shifted from a tenants’ market to what is now decidedly a landlord’s market, said Chris Herbert, research director at Harvard’s Joint Center for Housing Studies. The supply of properties is tightening and vacancy rates are dropping, so landlords have been emboldened to raise the rent.
Nationally, rents are expected to rise 5 percent this year and another 5 percent in 2012, according to Greg Willett, vice president of research and analysis at MPF Research in Carrollton, Texas. The trend is not expected to moderate until 2013, when new multifamily housing construction adds to supply and the housing market stabilizes enough to attract new buyers.
“In California, landlords have to file a 60-day notice if they plan to raise rents by more than 10 percent,” Herbert says. “And in some markets, we’re once again seeing them issue those notices.”
Of course all rental markets are local, and the trend is more pronounced in the San Francisco Bay area, for example, than in Southern California where rents are little changed.
In its annual State of the Nation’s Housing report released last week, the Harvard center said rising rents and the rising cost of owning a home are forcing Americans across all income levels to pay a higher proportion of their income for housing. As of 2009, more than 19 million households paid more than half their incomes for housing, including more than 10 million renters, according to the study. Households in the $45,000 to $60,000 income range have faced a particularly sharp increase in the housing cost burden over the past decade.
No one likes seeing the rent rise — but for renters, increases are often a fact of life. And even with the current rent hikes, rental rates in most markets haven’t even returned to prior highs set in 2007 and 2008, according to Willett.
“I think consumers have been taught to think the rent goes up every year, and generally it does,” says Willett. “But it’s the degree of increase that can bother renters. You look at the increase and you make that decision whether or not to move every time the lease comes up. If you’re renting now and you’ve just renewed for 12 months, you’ve probably got one more round of increases before things stabilize.”
Considering that the government-sponsored mortgage buyers Fannie Mae and Freddie Mac are facing potential reforms that could tighten lending standards, and that there’s still a heavy supply of homes for sale, some say renters may not be swayed to move into the ownership market for many years — especially if many new renters tend to be younger.
Most first-time buyers are in their early 30s, according to data from the National Association of Realtors. Metelica, the 24-year old renter, says he’ll probably be at least 29 before he thinks about buying. That means he, and others in his age range, may suffer through a few rent increases before they move to ownership.
To hear landlords discuss the marketplace, the good times have returned.
National apartment operators have adjusted their 2011 forecasts in recent weeks, citing a strong market that is allowing above-average rent increases. Avalonbay Communities, which owns 187 apartment buildings in ten states and Washington, D.C., said this month that rental revenue is expected to increase from 5 to 5.75 percent this year, up from a prior estimate of 4 to 5.5 percent.
"At this point we don't anticipate a recovery in for-sale housing until at least 2013," Michael Schall, president and chief executive officer of Essex Property Trust, stated in an earnings conference call last month. "We are now confident that the apartment supply and demand equation is tipping toward housing shortage and thus both rents and occupancies are improving."
Essex, which owns properties mainly in coastal cities, stated that Northern California and Seattle markets are ahead of Southern California markets, seeing high occupancy (meaning: low vacancy) and a recovery ahead of other areas in the company portfolio.
Chicago-based Equity Residential, which owns about 440 apartment building in major markets such as New York, Boston and Phoenix, reported that it’s expecting net operating income (which includes rental revenue) to rise from 5 to 7.5 percent this year.
Tammy Kotula, spokeswoman for Apartments.com, an online guide to apartments, urges renters to negotiate with landlords, or if they know they’re staying awhile, get a multiyear lease that allows tenants to lock in a low rent.
“You can definitely talk to your landlord and ask to negotiate,” she says. “A two-year lease is a pretty popular option.”
Just don’t expect keeping your rent down to be the cake walk it once was.
“I had to put up a fight about it,” Metelica says.
Jane Hodges is a Seattle-based writer.
Tuesday, May 10, 2011
The 10 Worst Cities for Renters - May 9, 2011
By Venessa Wong, Bloomberg Businessweek
The housing bust left thousands of empty, unfinished or foreclosed homes laying empty across the U.S. That means that there should be plenty of affordable housing, right? Wrong--not for renters anyway.
Over the past few decades, rental affordability has become a widespread problem in the U.S. as rent levels grew faster than renter income. Nearly half of renters pay more than 30 percent of their monthly income for rent, including 26 percent that pay more than 50 percent of income, according to a new report by Harvard University's Joint Center for Housing Studies. For this report we identified and ranked the nation's top 10 metropolitan areas by the percentage of tenants spending more than half of their income on rent.
And it’s not necessarily the most expensive cities that are to blame. While renters in such high-cost cities as New York and San Francisco grumble about how much they pay their landlords every month, residents in the Miami, McAllen, Tex., and Detroit metro areas are actually more strained, according to the Harvard report.
In fact, metro Miami has the greatest share of residents who pay more than half of their income to rent in the nation. The share reached 34.2 percent in 2009, up from 26 percent in 2000, as real household income growth stagnated and median rent in the area, adjusted for inflation, rose by 22.2 percent during that period, according to the Harvard report. In McAllen, the share of severely burdened renters rose to 33.1 percent and in Detroit to 32.8 percent.
The amount of income apportioned to rent has grown dramatically over the past fifty years. In 1960, about one-quarter of renters in the U.S. were at least moderately burdened, including 12 percent with a severe burden, according to Harvard's Joint Center. By 2009, the rate doubled to nearly half of renters with at least a moderate burden, including 26 percent with a severe burden.
“The impact is on what decisions families have to make. They will spend less on things that are important to their well being, such as healthcare, food, and savings,” says Chris Herbert, research director at the Joint Center. “There are also http://www.blogger.com/img/blank.giftradeoffs on the types of places they occupy and where they live, which also affects other life outcomes” and access to jobs, schools and other opportunities, he adds.
As more Americans are expected to rent in the next few years until restrictions on homeownership ease, increases in rent levels are expected to continue outpacing income growth. Demand for rentals also may continue to grow as the preference for homeownership changes. Unfortunately for cost-burdened renters, Matthew Greer, chief executive of Carlisle Development Group, Florida’s biggest developer of affordable housing with about 4,000 affordable rental units in the Miami metro area—says, as this happens, "the supply of affordable housing near the job core or by rapid transit lines is going to be unbelievably insufficient."
To see the full list, click here: http://realestate.yahoo.com/promo/the-10-worst-cities-for-renters.html
The housing bust left thousands of empty, unfinished or foreclosed homes laying empty across the U.S. That means that there should be plenty of affordable housing, right? Wrong--not for renters anyway.
Over the past few decades, rental affordability has become a widespread problem in the U.S. as rent levels grew faster than renter income. Nearly half of renters pay more than 30 percent of their monthly income for rent, including 26 percent that pay more than 50 percent of income, according to a new report by Harvard University's Joint Center for Housing Studies. For this report we identified and ranked the nation's top 10 metropolitan areas by the percentage of tenants spending more than half of their income on rent.
And it’s not necessarily the most expensive cities that are to blame. While renters in such high-cost cities as New York and San Francisco grumble about how much they pay their landlords every month, residents in the Miami, McAllen, Tex., and Detroit metro areas are actually more strained, according to the Harvard report.
In fact, metro Miami has the greatest share of residents who pay more than half of their income to rent in the nation. The share reached 34.2 percent in 2009, up from 26 percent in 2000, as real household income growth stagnated and median rent in the area, adjusted for inflation, rose by 22.2 percent during that period, according to the Harvard report. In McAllen, the share of severely burdened renters rose to 33.1 percent and in Detroit to 32.8 percent.
The amount of income apportioned to rent has grown dramatically over the past fifty years. In 1960, about one-quarter of renters in the U.S. were at least moderately burdened, including 12 percent with a severe burden, according to Harvard's Joint Center. By 2009, the rate doubled to nearly half of renters with at least a moderate burden, including 26 percent with a severe burden.
“The impact is on what decisions families have to make. They will spend less on things that are important to their well being, such as healthcare, food, and savings,” says Chris Herbert, research director at the Joint Center. “There are also http://www.blogger.com/img/blank.giftradeoffs on the types of places they occupy and where they live, which also affects other life outcomes” and access to jobs, schools and other opportunities, he adds.
As more Americans are expected to rent in the next few years until restrictions on homeownership ease, increases in rent levels are expected to continue outpacing income growth. Demand for rentals also may continue to grow as the preference for homeownership changes. Unfortunately for cost-burdened renters, Matthew Greer, chief executive of Carlisle Development Group, Florida’s biggest developer of affordable housing with about 4,000 affordable rental units in the Miami metro area—says, as this happens, "the supply of affordable housing near the job core or by rapid transit lines is going to be unbelievably insufficient."
To see the full list, click here: http://realestate.yahoo.com/promo/the-10-worst-cities-for-renters.html
Thursday, April 28, 2011
New City Center on Horizon for Brickell Area - April 28, 2011
The developer of Brickell Key is moving ahead on plans for a mixed-use development, which aims to create an urban retail destination.
By ELAINE WALKER
ewalker@MiamiHerald.com
New York City has Rockefeller Center. San Francisco boasts the Embarcardero Center. Now, Miami could have its version of a vibrant urban gathering place called Brickell CitiCentre.
The developer of Brickell Key has unveiled its long-awaited plans for a nearly $700 million urban shopping and mixed-use development spread over 9.1 acres just west of Brickell Avenue and south of the Miami River.
The project would create 1,700 jobs during construction and more than double that once completed.
Swire Properties will take the first steps this week toward a fast-track government approval process necessary for the 4.6 million-square-foot project that aims to create a retail destination unseen before in Miami’s urban core. The project – designed by Miami-based Arquitectonica – would also include restaurants, a hotel, office towers and apartments or condominiums, spread over a four-block area connected by bridges and covered walkways.
“We really see Miami as about to take the next and final step to become a true urban city, but retail is the missing link,” said Stephen Owens, president of Swire Properties. “Retail creates the pedestrian experience. In some ways what we’re trying to create is the Main Street like you have in most urban cities. Our goal is to really become the anchor for the urban area.”
Construction could begin by the end of 2011. Miami Mayor Tomás Regalado is a major advocate for the project.
It’s the first development of this magnitude submitted under Miami 21, the new zoning code designed to encourage more pedestrian-activity through mixed-use development
That vision is similar to what Swire, the Miami-based development arm of a Hong Kong conglomerate, has had in the works for more than two years. Swire acquired the first parcels of undeveloped land for Brickell CitiCentre in October 2008, just after the nation’s financial markets collapsed amid the worst recession in decades and land prices started to drop.
Conservative by nature, Swire Properties chose to sit out much of Miami’s real-estate boom passing on high-profile sites because it didn’t want to get into a bidding war. The company prefers to buy land in the down market and launch new development just in the early stages of a recovery.
“When markets are over heated we tend to not move very fast because the probability of oversupply is very likely,” Owens said. “One of the keys to building now is to be in position when the markets are robust again. If one waits until the obvious indicators are there, then you have a lot more competitors out there and construction costs increase dramatically.”
Swire’s ambitious plans call for trying to obtain final approval from the Miami City Commission in July and beginning construction by the end of this year or early 2012. The bulk of the project would be built over the course of four years, with a second phase featuring the majority of the office space and a second residential tower scheduled for a later date based on market demand.
While some question the ambitious timetable, they believe Swire is the type of developer that can make it happen.
“The size of this development has got to be over a 10-year program or more,” said Michael Cannon, a local real estate industry analyst. “If anyone has the capital to do it, they do. They have patient capital. They apparently have made a commitment to Miami.”
Swire would likely fund the development itself, if it doesn’t secure traditional financing, Owens said.
Brickell CitiCentre is expected to generate $1 billion in overall economic impact, according to a study by Miami Economic Associates. The benefits would include 1,700 construction jobs for each of the four years of construction, plus 3,800 jobs upon the project’s completion.
The city of Miami would receive $5.4 million in annual taxes from Brickell CitiCentre, while Miami-Dade County would get another $9.6 million in annual taxes.
“This is a huge complex that will bring to Brickell Avenue, downtown Miami and East Little Havana an energy it has never, ever seen before,” said Regalado, who will take the nontraditional step of presenting a developer’s project to the City Commission. “I think it needs to carry the clout of the office of the mayor to send a message that this is a huge project for the city of Miami.”
The last major project of this magnitude was Midtown Miami, but that development is being built in phases and spread out over a larger area. Midtown also includes more residential towers and big-box retail.
Brickell CitiCentre is a natural next step for Swire Properties, which bought the deserted Claughton Island in 1980 and turned it into Brickell Key, a secluded haven of high-end condominiums, office buildings, a Mandarin Oriental hotel and a smattering of retail shops and restaurants. With only one undeveloped parcel left on Brickell Key adjacent to the Mandarin Oriental, Swire set its sites years ago on finding a new venture in the heart of the Brickell Financial District.
Swire paid $41 million in an all-cash deal for the first two undeveloped parcels that form the core for Brickell CitiCentre, straddling South Miami Avenue. The land had been on the market during the boom for as much as $110 million and the original plans for a different version of a mixed-used project with the same name were designed by a group headed by J. Kevin Reilly. But Swire acquired the property after the lender iStar Financial took the property back from Reilly.
The final parcels – the Brickell Tennis Center and the Eastern National Bank headquarters – were acquired earlier this year for a total cost of about $27 million. The additional acreage was necessary to get the site over the nine-acre threshold needed to apply for a special area plan under the terms of Miami 21.
Brickell CitiCentre is modeled after similar projects that Swire’s parent company has developed in Asia, including Pacific Place in Hong Kong. The first phase would include about 500,000-square feet of retail shops and restaurants, a 290-room four-star hotel, two eight-story office towers and a residential tower with about 270 units.
The retail would likely be anchored by at least one department store, plus a mix of luxury and moderate retailers focusing on fashion brands and home furnishings, including national and international brands, Owens said. The project would not contain big-box retailers like Target or Best Buy.
Retail industry experts agree that the dense urban area has enough consumers to support the project. The challenge will be luring retailers away from other shopping centers or persuading them to open an another store.
“It’s certainly going to give Merrick Park a run for its money, as well as Dadeland,” said Cynthia Cohen, president of Strategic Mindshare, a retail consultant with a Miami office.
The key, she said, would be the name-brand anchor stores.
“If you’re going to steal retailers from Dadeland or Merrick Park, you’ve got to make them a better deal. Those better deals have a financial impact on your pocket. They have to be willing to play this out for the long term.”
Read more: http://www.miamiherald.com/2011/04/27/v-fullstory/2188997/new-city-center-on-horizon-for.html#ixzz1KplrRKrF
By ELAINE WALKER
ewalker@MiamiHerald.com
New York City has Rockefeller Center. San Francisco boasts the Embarcardero Center. Now, Miami could have its version of a vibrant urban gathering place called Brickell CitiCentre.
The developer of Brickell Key has unveiled its long-awaited plans for a nearly $700 million urban shopping and mixed-use development spread over 9.1 acres just west of Brickell Avenue and south of the Miami River.
The project would create 1,700 jobs during construction and more than double that once completed.
Swire Properties will take the first steps this week toward a fast-track government approval process necessary for the 4.6 million-square-foot project that aims to create a retail destination unseen before in Miami’s urban core. The project – designed by Miami-based Arquitectonica – would also include restaurants, a hotel, office towers and apartments or condominiums, spread over a four-block area connected by bridges and covered walkways.
“We really see Miami as about to take the next and final step to become a true urban city, but retail is the missing link,” said Stephen Owens, president of Swire Properties. “Retail creates the pedestrian experience. In some ways what we’re trying to create is the Main Street like you have in most urban cities. Our goal is to really become the anchor for the urban area.”
Construction could begin by the end of 2011. Miami Mayor Tomás Regalado is a major advocate for the project.
It’s the first development of this magnitude submitted under Miami 21, the new zoning code designed to encourage more pedestrian-activity through mixed-use development
That vision is similar to what Swire, the Miami-based development arm of a Hong Kong conglomerate, has had in the works for more than two years. Swire acquired the first parcels of undeveloped land for Brickell CitiCentre in October 2008, just after the nation’s financial markets collapsed amid the worst recession in decades and land prices started to drop.
Conservative by nature, Swire Properties chose to sit out much of Miami’s real-estate boom passing on high-profile sites because it didn’t want to get into a bidding war. The company prefers to buy land in the down market and launch new development just in the early stages of a recovery.
“When markets are over heated we tend to not move very fast because the probability of oversupply is very likely,” Owens said. “One of the keys to building now is to be in position when the markets are robust again. If one waits until the obvious indicators are there, then you have a lot more competitors out there and construction costs increase dramatically.”
Swire’s ambitious plans call for trying to obtain final approval from the Miami City Commission in July and beginning construction by the end of this year or early 2012. The bulk of the project would be built over the course of four years, with a second phase featuring the majority of the office space and a second residential tower scheduled for a later date based on market demand.
While some question the ambitious timetable, they believe Swire is the type of developer that can make it happen.
“The size of this development has got to be over a 10-year program or more,” said Michael Cannon, a local real estate industry analyst. “If anyone has the capital to do it, they do. They have patient capital. They apparently have made a commitment to Miami.”
Swire would likely fund the development itself, if it doesn’t secure traditional financing, Owens said.
Brickell CitiCentre is expected to generate $1 billion in overall economic impact, according to a study by Miami Economic Associates. The benefits would include 1,700 construction jobs for each of the four years of construction, plus 3,800 jobs upon the project’s completion.
The city of Miami would receive $5.4 million in annual taxes from Brickell CitiCentre, while Miami-Dade County would get another $9.6 million in annual taxes.
“This is a huge complex that will bring to Brickell Avenue, downtown Miami and East Little Havana an energy it has never, ever seen before,” said Regalado, who will take the nontraditional step of presenting a developer’s project to the City Commission. “I think it needs to carry the clout of the office of the mayor to send a message that this is a huge project for the city of Miami.”
The last major project of this magnitude was Midtown Miami, but that development is being built in phases and spread out over a larger area. Midtown also includes more residential towers and big-box retail.
Brickell CitiCentre is a natural next step for Swire Properties, which bought the deserted Claughton Island in 1980 and turned it into Brickell Key, a secluded haven of high-end condominiums, office buildings, a Mandarin Oriental hotel and a smattering of retail shops and restaurants. With only one undeveloped parcel left on Brickell Key adjacent to the Mandarin Oriental, Swire set its sites years ago on finding a new venture in the heart of the Brickell Financial District.
Swire paid $41 million in an all-cash deal for the first two undeveloped parcels that form the core for Brickell CitiCentre, straddling South Miami Avenue. The land had been on the market during the boom for as much as $110 million and the original plans for a different version of a mixed-used project with the same name were designed by a group headed by J. Kevin Reilly. But Swire acquired the property after the lender iStar Financial took the property back from Reilly.
The final parcels – the Brickell Tennis Center and the Eastern National Bank headquarters – were acquired earlier this year for a total cost of about $27 million. The additional acreage was necessary to get the site over the nine-acre threshold needed to apply for a special area plan under the terms of Miami 21.
Brickell CitiCentre is modeled after similar projects that Swire’s parent company has developed in Asia, including Pacific Place in Hong Kong. The first phase would include about 500,000-square feet of retail shops and restaurants, a 290-room four-star hotel, two eight-story office towers and a residential tower with about 270 units.
The retail would likely be anchored by at least one department store, plus a mix of luxury and moderate retailers focusing on fashion brands and home furnishings, including national and international brands, Owens said. The project would not contain big-box retailers like Target or Best Buy.
Retail industry experts agree that the dense urban area has enough consumers to support the project. The challenge will be luring retailers away from other shopping centers or persuading them to open an another store.
“It’s certainly going to give Merrick Park a run for its money, as well as Dadeland,” said Cynthia Cohen, president of Strategic Mindshare, a retail consultant with a Miami office.
The key, she said, would be the name-brand anchor stores.
“If you’re going to steal retailers from Dadeland or Merrick Park, you’ve got to make them a better deal. Those better deals have a financial impact on your pocket. They have to be willing to play this out for the long term.”
Read more: http://www.miamiherald.com/2011/04/27/v-fullstory/2188997/new-city-center-on-horizon-for.html#ixzz1KplrRKrF
Saturday, April 2, 2011
FIU Moves to Bigger Downtown Digs, on Brickell - April 2, 2011
Florida International University is expanding its downtown Miami presence with a new Brickell location.
By Michael Vasquez
mrvasquez@MiamiHerald.com
Florida International University is expanding its downtown Miami presence – adding students, a new global governance program, and a more-prestigious address.
Beginning this fall, FIU’s downtown educational center will operate from a new location: 1101 Brickell Ave.
The new space will house College of Business Administration and School of International and Public Affairs programs, as well as FIU’s Metropolitan Center, a local public affairs think-tank.
Though FIU has offered some master’s degrees downtown since 2004 – occupying office space above Flagler Street’s landmark Macy’s building – the move to a new location will more than double FIU’s capacity to serve students in the area. Right now, FIU serves about 500 students downtown, but the new Brickell location will have capacity for more than 1,000 students. Brickell’s prominence within the business community should also provide FIU’s programs more visibility.
Degrees offered will include business and management-oriented Professional MBA, Healthcare MBA, Master of Science in International Real Estate, and a new Master of Arts in Global Governance that prepares graduates for jobs with internationally-focused groups such as non-profit organizations.
For a long time, the main challenge of remaking downtown Miami was persuading people to live there. Now, with downtown boasting roughly 70,000 residents, attention has shifted to providing the type of neighborhood amenities that people want – places to shop, for example. Places to eat.
And for the upwardly mobile urban professional, places to learn.
"It’s really a very convenient location for downtowners," said Alyce Robertson, executive director of Miami’s Downtown Development Authority. "Brickell is the financial center of Miami-Dade."
Recent changes to state law provided a big incentive for FIU to expand its master’s degree offerings. In 2010, the Legislature authorized state schools to charge "market rate" tuition for certain graduate-level programs. Under the old tuition structure, the school’s MBA programs were losing money, FIU President Mark Rosenberg said.
With the new ability to charge higher tuition, "we expect that this will actually generate some additional revenue to add even more programs," Rosenberg said.
MBA students might be less than thrilled with these legislative changes. Assuming FIU’s new price scale is approved by the state’s Board of Governors, the price of a Professional MBA will jump from $42,000 to $45,000. The cost of a Healthcare MBA will jump from $42,000 to $48,000.
"It gives us greater freedom to offer programs that people demand," Rosenberg said. "And how do you know they demand it? Because they’re willing to pay the higher price for those programs."
Read more: http://www.miamiherald.com/2011/04/01/2146163/fiu-moves-its-downtown-presence.html#ixzz1IOESs7ih
By Michael Vasquez
mrvasquez@MiamiHerald.com
Florida International University is expanding its downtown Miami presence – adding students, a new global governance program, and a more-prestigious address.
Beginning this fall, FIU’s downtown educational center will operate from a new location: 1101 Brickell Ave.
The new space will house College of Business Administration and School of International and Public Affairs programs, as well as FIU’s Metropolitan Center, a local public affairs think-tank.
Though FIU has offered some master’s degrees downtown since 2004 – occupying office space above Flagler Street’s landmark Macy’s building – the move to a new location will more than double FIU’s capacity to serve students in the area. Right now, FIU serves about 500 students downtown, but the new Brickell location will have capacity for more than 1,000 students. Brickell’s prominence within the business community should also provide FIU’s programs more visibility.
Degrees offered will include business and management-oriented Professional MBA, Healthcare MBA, Master of Science in International Real Estate, and a new Master of Arts in Global Governance that prepares graduates for jobs with internationally-focused groups such as non-profit organizations.
For a long time, the main challenge of remaking downtown Miami was persuading people to live there. Now, with downtown boasting roughly 70,000 residents, attention has shifted to providing the type of neighborhood amenities that people want – places to shop, for example. Places to eat.
And for the upwardly mobile urban professional, places to learn.
"It’s really a very convenient location for downtowners," said Alyce Robertson, executive director of Miami’s Downtown Development Authority. "Brickell is the financial center of Miami-Dade."
Recent changes to state law provided a big incentive for FIU to expand its master’s degree offerings. In 2010, the Legislature authorized state schools to charge "market rate" tuition for certain graduate-level programs. Under the old tuition structure, the school’s MBA programs were losing money, FIU President Mark Rosenberg said.
With the new ability to charge higher tuition, "we expect that this will actually generate some additional revenue to add even more programs," Rosenberg said.
MBA students might be less than thrilled with these legislative changes. Assuming FIU’s new price scale is approved by the state’s Board of Governors, the price of a Professional MBA will jump from $42,000 to $45,000. The cost of a Healthcare MBA will jump from $42,000 to $48,000.
"It gives us greater freedom to offer programs that people demand," Rosenberg said. "And how do you know they demand it? Because they’re willing to pay the higher price for those programs."
Read more: http://www.miamiherald.com/2011/04/01/2146163/fiu-moves-its-downtown-presence.html#ixzz1IOESs7ih
City Offers Big Rebate for Omni Area Hotel - April 2, 2011
Miami’s redevelopment agency approved a tax rebate of up to $9million to help get developer Tibor Hollo’s long-stalled Omni-area hotel tower off the ground.
By ANDRES VIGLUCCI
aviglucci@miamiherald.com
Veteran developer Tibor Hollo’s long-stalled effort to build a hotel in Miami’s Omni district will get a big boost from the city’s community redevelopment agency, which has agreed to an unusual tax rebate of up to $9 million to help get the project off the ground.
Though providing financial incentives for private development is part of the anti-poverty agency’s mission, the size of the rebate has raised eyebrows among city watchers, some of whom question whether the city is getting enough in return.
In exchange for the rebate, approved by the agency this week, Hollo’s Florida East Coast Realty has pledged to generate at least 268 new full-time jobs in its hotel, with about a third coming from the surrounding area, which includes portions of Overtown.
Hollo and CRA officials say the deal is carefully calibrated to produce real public benefits, including helping re-start development and spur business in the area, generating new property taxes, and creating hundreds of permanent and temporary jobs.
"You’re incentivizing people to build now, to start to see a crane go up," said Miami Commissioner Marc Sarnoff, chairman of the Omni Community Redevelopment Agency. "This makes good strategic sense. It is tied to jobs."
The precise size of the rebate — which would come out of the property taxes generated by the hotel — would depend on the number of jobs actually produced, the size of Hollo’s investment and how quickly he gets the project done. The rebate is capped at $600,000 a year until the expiration of the CRA in 2030, and would kick in after Hollo completes the planned $62 million, 250-room Mikado hotel tower around the end of 2014, and after the project has generated $1.2 million in taxes. Given that timing, CRA administrators say, the project is unlikely to qualify for the maximum rebate of $9 million.
The hotel, which will rise on a vacant lot at Northeast 17th Street and Fourth Avenue, just north of the massive Omni center Hollo built in the 1970s, also includes retail and commercial space.
An analysis by the agency concluded that each job produced would cost the city about $1,100 a year. The city can kill the deal if the project isn’t under way by 2019.
But former CRA director Frank Rollason, echoing some comments on blogs critical of the city administration, questions whether the agency drove a hard enough bargain. For instance, he said, redevelopment agencies often get public parking, office space for city use or other public benefits in addition to jobs in exchange for tax rebates. In this case, Hollo has agreed only to host four CRA meetings a year.
And before deciding to spend its money on Hollo’s project, city officials should analyze whether the hotel could be built without city help, Rollason said.
"I don’t fault Tibor. He’s a shrewd businessman, and there is no harm in his asking," Rollason said. "But if you’re the city, you have to look at this project and see if this is something Tibor would have built anyway, or is it something that won’t come out of the ground if the CRA doesn’t get involved."
It’s definitely the latter, said Hollo’s son and company vice president Jerome Hollo. Since the market crash stalled the project, the developers’ bankers have committed to financing the project, but stricter borrowing requirements make it harder to raise all the money they need, Jerome Hollo said. The CRA money helps fill that gap, and will thus help draw substantial private investment into the district, he said.
"This was one important piece" in bringing the project to fruition, Hollo said. "We feel the timing is right now."
He also noted that the taxes to be rebated will be only a portion of the property’s tax bill, which he estimated at $900,000 to $1.2 million annually, meaning local governments will still receive significant additional revenue from the project.
"What people have to recognize is this is a tax increment that would not be there if not for this project," Hollo said.
The Mikado also includes 119 market-rate apartments for active seniors who can take advantage of the hotel’s services, but the CRA tax rebate will not go to that portion of the project, Hollo said.
The mixed-use Mikado project, which the city commission approved in 2006, is the last piece in a set of adjacent residential towers Hollo built north of the Omni just before and during the real estate boom of the mid-2000s. The hotel, planned to capitalize on the construction of the nearby Arsht Center for the Performing Arts, is named after the famous Gilbert and Sullivan opera set in Japan and will have an Asian theme. Sonesta will manage the hotel.
Jerome Hollo said he is now working on obtaining construction permits from the city and work could begin within weeks "if all goes well."
Sarnoff noted there is precedent for the Mikado deal. The CRA has approved two similar tax-rebate deals in the Omni District, for the Bayview Marketplace retail center and the multi-use Omni Complex project on Biscayne Boulevard, though neither one of those is moving forward at present.
Sarnoff, whose commission district includes the Omni area and who is up for re-election this year, has benefited from campaign contributions by Hollo’s companies. In his last campaign finance report, covering the last three months of 2010, Sarnoff’s campaign reported receiving $10,500 in contributions, including at least $9,000 in contributions from Florida East Coast Realty and 17 other corporate entities listing Hollo’s office address. Each gave the maximum $500. Sarnoff has reported receiving a total of $298,000 in contributions.
Sarnoff said the contributions from Hollo did not influence his decision to support the Mikado tax rebate.
"I don’t sell my vote," he said. "I never have and I never will."
Read more: http://www.miamiherald.com/2011/04/01/v-fullstory/2146283/miamis-redevelopment-agency-oks.html#ixzz1IOD3XIgw
By ANDRES VIGLUCCI
aviglucci@miamiherald.com
Veteran developer Tibor Hollo’s long-stalled effort to build a hotel in Miami’s Omni district will get a big boost from the city’s community redevelopment agency, which has agreed to an unusual tax rebate of up to $9 million to help get the project off the ground.
Though providing financial incentives for private development is part of the anti-poverty agency’s mission, the size of the rebate has raised eyebrows among city watchers, some of whom question whether the city is getting enough in return.
In exchange for the rebate, approved by the agency this week, Hollo’s Florida East Coast Realty has pledged to generate at least 268 new full-time jobs in its hotel, with about a third coming from the surrounding area, which includes portions of Overtown.
Hollo and CRA officials say the deal is carefully calibrated to produce real public benefits, including helping re-start development and spur business in the area, generating new property taxes, and creating hundreds of permanent and temporary jobs.
"You’re incentivizing people to build now, to start to see a crane go up," said Miami Commissioner Marc Sarnoff, chairman of the Omni Community Redevelopment Agency. "This makes good strategic sense. It is tied to jobs."
The precise size of the rebate — which would come out of the property taxes generated by the hotel — would depend on the number of jobs actually produced, the size of Hollo’s investment and how quickly he gets the project done. The rebate is capped at $600,000 a year until the expiration of the CRA in 2030, and would kick in after Hollo completes the planned $62 million, 250-room Mikado hotel tower around the end of 2014, and after the project has generated $1.2 million in taxes. Given that timing, CRA administrators say, the project is unlikely to qualify for the maximum rebate of $9 million.
The hotel, which will rise on a vacant lot at Northeast 17th Street and Fourth Avenue, just north of the massive Omni center Hollo built in the 1970s, also includes retail and commercial space.
An analysis by the agency concluded that each job produced would cost the city about $1,100 a year. The city can kill the deal if the project isn’t under way by 2019.
But former CRA director Frank Rollason, echoing some comments on blogs critical of the city administration, questions whether the agency drove a hard enough bargain. For instance, he said, redevelopment agencies often get public parking, office space for city use or other public benefits in addition to jobs in exchange for tax rebates. In this case, Hollo has agreed only to host four CRA meetings a year.
And before deciding to spend its money on Hollo’s project, city officials should analyze whether the hotel could be built without city help, Rollason said.
"I don’t fault Tibor. He’s a shrewd businessman, and there is no harm in his asking," Rollason said. "But if you’re the city, you have to look at this project and see if this is something Tibor would have built anyway, or is it something that won’t come out of the ground if the CRA doesn’t get involved."
It’s definitely the latter, said Hollo’s son and company vice president Jerome Hollo. Since the market crash stalled the project, the developers’ bankers have committed to financing the project, but stricter borrowing requirements make it harder to raise all the money they need, Jerome Hollo said. The CRA money helps fill that gap, and will thus help draw substantial private investment into the district, he said.
"This was one important piece" in bringing the project to fruition, Hollo said. "We feel the timing is right now."
He also noted that the taxes to be rebated will be only a portion of the property’s tax bill, which he estimated at $900,000 to $1.2 million annually, meaning local governments will still receive significant additional revenue from the project.
"What people have to recognize is this is a tax increment that would not be there if not for this project," Hollo said.
The Mikado also includes 119 market-rate apartments for active seniors who can take advantage of the hotel’s services, but the CRA tax rebate will not go to that portion of the project, Hollo said.
The mixed-use Mikado project, which the city commission approved in 2006, is the last piece in a set of adjacent residential towers Hollo built north of the Omni just before and during the real estate boom of the mid-2000s. The hotel, planned to capitalize on the construction of the nearby Arsht Center for the Performing Arts, is named after the famous Gilbert and Sullivan opera set in Japan and will have an Asian theme. Sonesta will manage the hotel.
Jerome Hollo said he is now working on obtaining construction permits from the city and work could begin within weeks "if all goes well."
Sarnoff noted there is precedent for the Mikado deal. The CRA has approved two similar tax-rebate deals in the Omni District, for the Bayview Marketplace retail center and the multi-use Omni Complex project on Biscayne Boulevard, though neither one of those is moving forward at present.
Sarnoff, whose commission district includes the Omni area and who is up for re-election this year, has benefited from campaign contributions by Hollo’s companies. In his last campaign finance report, covering the last three months of 2010, Sarnoff’s campaign reported receiving $10,500 in contributions, including at least $9,000 in contributions from Florida East Coast Realty and 17 other corporate entities listing Hollo’s office address. Each gave the maximum $500. Sarnoff has reported receiving a total of $298,000 in contributions.
Sarnoff said the contributions from Hollo did not influence his decision to support the Mikado tax rebate.
"I don’t sell my vote," he said. "I never have and I never will."
Read more: http://www.miamiherald.com/2011/04/01/v-fullstory/2146283/miamis-redevelopment-agency-oks.html#ixzz1IOD3XIgw
Tuesday, March 8, 2011
Miami New-Condo Sales Revive As Biggest Markets Fall - March 8, 2011
By MARILYN ALVA, INVESTOR'S BUSINESS DAILY
Posted 03/03/2011 02:43 PM ET
The new-condo boom struck louder in Miami than it did in other markets and fell hardest there when the thunder stopped.
Now the area stands out again. Its new-condo market is coming back stronger in sales and pricing, though it's a fraction of its old self.
Thank all-cash buyers from Venezuela, Argentina, Brazil, Canada, Europe and other locales. They see Miami's luxury condos at discounted prices as safe havens for investment money.
Positive sales trends continue.
"These people are parking their cash," said Peter Zalewski, principal of real estate consultancy Condo Vultures. "In Venezuela, they're fearful they're going to lose it (under President Hugo Chavez's strong-arm rule). Canadians are saying their currency is on par with the U.S. dollar, so in their minds they are getting a 25% discount."
Of the top eight U.S. metro areas, Miami was the only one in 2010 to show volume gains in attached-home closings, mainly condos, according to data gathered by Hanley Wood Market Intelligence.
The other seven fell 5% to 37% as Miami rose 8%. New York dropped 13%, Los Angeles 20% and San Francisco 37%. Unit sales totaled 4,120 in Miami — above L.A.'s 3,935 — but that still pales vs. pre-crash years 2005-07, when 20,000 to 30,000 units sold each year.
The Miami metro figures cited by Hanley Wood include Miami-Dade, Broward and Palm Beach counties. Miami-Dade is almost 70% of the total, at 2,842 closings.
"Miami is a happening place; it's really become a dynamic marketplace," said Jay Massirman, managing director of Asentus Real Estate, a real estate investment and merchant banking firm in Miami Beach.
All About Inventory
L.A. and other spots that dropped off in new-condo sales hadn't seen as big a spike in construction as the Miami area. Some 85,000 new condo units were built in the area from 2003-10, with 49,000 in coastal areas east of I-95, says Condo Vultures. Greater downtown Miami accounted for 22,250 units.
Bulk sales have figured in Miami's condo recovery, as investors bet that South Florida's cachet will continue. Last year 3,700 units in downtown Miami sold, up 57% from 2,300 in 2009, says Condo Vultures. Some 1,600 units sold in 10 bulk deals, Zalewski says. The rest were to individual all-cash buyers, mostly from overseas.
New construction has virtually halted as the market works through new inventory from prior years that hasn't sold yet. As prices rise, the pace of bulk buying seems to be slowing, at least in the coastal and downtown urban cores, leaving those markets to all-cash individual buyers, local watchers say.
Meanwhile, in Miami-Dade County the median price of an attached home — a condo, for the most part — rose 11% to $288,614 last year, says Hanley Wood. The median price was higher than the peak year of 2006, when 17,400 closings were recorded. But many low-price condos have been converted to rentals, skewing inventory to luxury units.
"A lot of the inventory has been absorbed fairly rapidly and it is continuing to be absorbed," Massirman said. Where blocks of brand-new condo towers on Brickell Avenue near downtown stood dark, "lights are on, people are jogging on the street and dining in restaurants."
Buying In Landlord Land
Most new occupants are renters.
"The number of buyers we see who are end users is a very tiny minority," Zalewski said. "The family of four with a dog doesn't have a chance in this (new-construction) market because there's no financing. If you can find a lender, you have to put down 50%."
Even so, the sales rebound is welcome relief to condo associations that have struggled to keep up services at empty or half-empty buildings. At least new owners pay monthly association fees, as their tenants live the high life, enjoying amenities such as sleek kitchens and rooftop pools.
"A lot of these association issues are working themselves out," Massirman said.
Falling prices had a lot to do with the rebound. "In 2009, prices started to bottom," Massirman said, noting that new condos on Brickell fell to as low as $200 a square foot from $600 three years earlier. In late 2009, investors "started piling in."
Bulk buyers and other investors are starting to turn their sights to suburban neighborhoods away from the coast, where prices are still falling, observers say.
"East of I-95 is well past the bottom," Zalewski said. "West of I-95 is a market that doesn't have any kind of safety stop. The 10% local unemployment rate has a drastic effect on the suburban market."
The median price of an existing single-family home in the Miami metro area, which includes condos, fell 18.3% in January from a year ago, to $165,800, says the National Association of Realtors. As prices fell, sales rose 32.9%.
Investors scouting the western suburbs of Miami are looking to pick up multiple units in garden-style condo conversions for $25,000 to $50,000 each, Zalewski says.
"The new-condo market is starting to slow. The resale condo market is starting to heat up," he said.
Posted 03/03/2011 02:43 PM ET
The new-condo boom struck louder in Miami than it did in other markets and fell hardest there when the thunder stopped.
Now the area stands out again. Its new-condo market is coming back stronger in sales and pricing, though it's a fraction of its old self.
Thank all-cash buyers from Venezuela, Argentina, Brazil, Canada, Europe and other locales. They see Miami's luxury condos at discounted prices as safe havens for investment money.
Positive sales trends continue.
"These people are parking their cash," said Peter Zalewski, principal of real estate consultancy Condo Vultures. "In Venezuela, they're fearful they're going to lose it (under President Hugo Chavez's strong-arm rule). Canadians are saying their currency is on par with the U.S. dollar, so in their minds they are getting a 25% discount."
Of the top eight U.S. metro areas, Miami was the only one in 2010 to show volume gains in attached-home closings, mainly condos, according to data gathered by Hanley Wood Market Intelligence.
The other seven fell 5% to 37% as Miami rose 8%. New York dropped 13%, Los Angeles 20% and San Francisco 37%. Unit sales totaled 4,120 in Miami — above L.A.'s 3,935 — but that still pales vs. pre-crash years 2005-07, when 20,000 to 30,000 units sold each year.
The Miami metro figures cited by Hanley Wood include Miami-Dade, Broward and Palm Beach counties. Miami-Dade is almost 70% of the total, at 2,842 closings.
"Miami is a happening place; it's really become a dynamic marketplace," said Jay Massirman, managing director of Asentus Real Estate, a real estate investment and merchant banking firm in Miami Beach.
All About Inventory
L.A. and other spots that dropped off in new-condo sales hadn't seen as big a spike in construction as the Miami area. Some 85,000 new condo units were built in the area from 2003-10, with 49,000 in coastal areas east of I-95, says Condo Vultures. Greater downtown Miami accounted for 22,250 units.
Bulk sales have figured in Miami's condo recovery, as investors bet that South Florida's cachet will continue. Last year 3,700 units in downtown Miami sold, up 57% from 2,300 in 2009, says Condo Vultures. Some 1,600 units sold in 10 bulk deals, Zalewski says. The rest were to individual all-cash buyers, mostly from overseas.
New construction has virtually halted as the market works through new inventory from prior years that hasn't sold yet. As prices rise, the pace of bulk buying seems to be slowing, at least in the coastal and downtown urban cores, leaving those markets to all-cash individual buyers, local watchers say.
Meanwhile, in Miami-Dade County the median price of an attached home — a condo, for the most part — rose 11% to $288,614 last year, says Hanley Wood. The median price was higher than the peak year of 2006, when 17,400 closings were recorded. But many low-price condos have been converted to rentals, skewing inventory to luxury units.
"A lot of the inventory has been absorbed fairly rapidly and it is continuing to be absorbed," Massirman said. Where blocks of brand-new condo towers on Brickell Avenue near downtown stood dark, "lights are on, people are jogging on the street and dining in restaurants."
Buying In Landlord Land
Most new occupants are renters.
"The number of buyers we see who are end users is a very tiny minority," Zalewski said. "The family of four with a dog doesn't have a chance in this (new-construction) market because there's no financing. If you can find a lender, you have to put down 50%."
Even so, the sales rebound is welcome relief to condo associations that have struggled to keep up services at empty or half-empty buildings. At least new owners pay monthly association fees, as their tenants live the high life, enjoying amenities such as sleek kitchens and rooftop pools.
"A lot of these association issues are working themselves out," Massirman said.
Falling prices had a lot to do with the rebound. "In 2009, prices started to bottom," Massirman said, noting that new condos on Brickell fell to as low as $200 a square foot from $600 three years earlier. In late 2009, investors "started piling in."
Bulk buyers and other investors are starting to turn their sights to suburban neighborhoods away from the coast, where prices are still falling, observers say.
"East of I-95 is well past the bottom," Zalewski said. "West of I-95 is a market that doesn't have any kind of safety stop. The 10% local unemployment rate has a drastic effect on the suburban market."
The median price of an existing single-family home in the Miami metro area, which includes condos, fell 18.3% in January from a year ago, to $165,800, says the National Association of Realtors. As prices fell, sales rose 32.9%.
Investors scouting the western suburbs of Miami are looking to pick up multiple units in garden-style condo conversions for $25,000 to $50,000 each, Zalewski says.
"The new-condo market is starting to slow. The resale condo market is starting to heat up," he said.
Tuesday, January 25, 2011
Miami Top Big City to Buy Home Now - January 25, 2011
It makes more sense to buy a home in Miami rather than to rent, according to a new report from Trulia, which ranks Miami as the nation's top buyer's market.
BY TOLUSE OLORUNNIPA
tolorunnipa@MiamiHerald.com
Is there any upside to having a sky-high foreclosure rate, double-digit unemployment and a tight credit market? According to a respected real estate firm, these elements help make Miami the top market in the nation to buy a home rather than to rent.
Miami has moved up two spots since last year to become the nation's most attractive market to become a homeowner rather than renting, a new report by real estate research firm Trulia found. The study, released Monday, compared home prices and rental rates in the nation's 50 largest cities to determine where homeownership made the most financial sense.
Potential buyers are starting to take note of South Florida's shifting buy-vs.-rent dynamic. Arden Shank, director of Neighborhood Housing Services of South Florida, said first-time homebuyers from Broward and Miami-Dade counties are flooding his office.
"We have more families coming through the homebuyers preparation process than we have ever had," he said. "A lot of people who were priced out of the market before can now afford to buy a home."
Trulia came up with the ranking by comparing the cost of buying a median-priced 2-bedroom, 2-bath home with the cost of renting a similar property for a year. Cities were ranked as either "buy" or "rent" based on the ratio of buy-to-rent costs.
For example, the median-priced 2-bedroom in Miami costs $140,201, according to the website. To rent a 2-bedroom apartment for a year would cost $22,459, resulting in a buy-to-rent ratio of 6 (Trulia rounds to the nearest whole number). In other words, renting a home for six years would cost about as much as buying a home free-and-clear. The markets where it makes the least financial sense to buy -- places like New York and Seattle -- have buy-to-rent ratios as high as 31. Any ratio below 15 was considered a buyer's market.
The report factors in costs associated with homeownership like interest, insurance, and property taxes. Even with the additional costs, buying a home is more affordable than renting in 72 percent of the nation's largest cities. The cities where homeownership is a particularly desirable option are places struggling with high unemployment and foreclosures -- areas like Phoenix, Jacksonville and Fresno.
Trulia found in the midst of the buyer's market, renting is becoming more popular and more costly at the same time.
"Since the start of the 'Great Recession,' many former homeowners have flooded the rental market. Following the principles of supply and demand, renting has become relatively more expensive than buying in most markets," said Pete Flint, CEO and co-founder of Trulia, in a statement.
Read more: http://www.miamiherald.com/2011/01/25/2032762/miami-top-big-city-to-buy-home.html#ixzz1C4sJqYmA
BY TOLUSE OLORUNNIPA
tolorunnipa@MiamiHerald.com
Is there any upside to having a sky-high foreclosure rate, double-digit unemployment and a tight credit market? According to a respected real estate firm, these elements help make Miami the top market in the nation to buy a home rather than to rent.
Miami has moved up two spots since last year to become the nation's most attractive market to become a homeowner rather than renting, a new report by real estate research firm Trulia found. The study, released Monday, compared home prices and rental rates in the nation's 50 largest cities to determine where homeownership made the most financial sense.
Potential buyers are starting to take note of South Florida's shifting buy-vs.-rent dynamic. Arden Shank, director of Neighborhood Housing Services of South Florida, said first-time homebuyers from Broward and Miami-Dade counties are flooding his office.
"We have more families coming through the homebuyers preparation process than we have ever had," he said. "A lot of people who were priced out of the market before can now afford to buy a home."
Trulia came up with the ranking by comparing the cost of buying a median-priced 2-bedroom, 2-bath home with the cost of renting a similar property for a year. Cities were ranked as either "buy" or "rent" based on the ratio of buy-to-rent costs.
For example, the median-priced 2-bedroom in Miami costs $140,201, according to the website. To rent a 2-bedroom apartment for a year would cost $22,459, resulting in a buy-to-rent ratio of 6 (Trulia rounds to the nearest whole number). In other words, renting a home for six years would cost about as much as buying a home free-and-clear. The markets where it makes the least financial sense to buy -- places like New York and Seattle -- have buy-to-rent ratios as high as 31. Any ratio below 15 was considered a buyer's market.
The report factors in costs associated with homeownership like interest, insurance, and property taxes. Even with the additional costs, buying a home is more affordable than renting in 72 percent of the nation's largest cities. The cities where homeownership is a particularly desirable option are places struggling with high unemployment and foreclosures -- areas like Phoenix, Jacksonville and Fresno.
Trulia found in the midst of the buyer's market, renting is becoming more popular and more costly at the same time.
"Since the start of the 'Great Recession,' many former homeowners have flooded the rental market. Following the principles of supply and demand, renting has become relatively more expensive than buying in most markets," said Pete Flint, CEO and co-founder of Trulia, in a statement.
Read more: http://www.miamiherald.com/2011/01/25/2032762/miami-top-big-city-to-buy-home.html#ixzz1C4sJqYmA
Wednesday, January 5, 2011
Downtown Miami to Get 6 New Restaurants, Clubs - January 5, 2011
Downtown Miami could get a boost at revitalization this year.
Six new restaurants and night life operators are expected to occupy 20,000 square feet on the ground floor of Macy's west building, 2 W. Flagler St., in downtown Miami by June 1, said Bill Fuller and Martin Pinilla II, managing partners of the Miami-based Barlington Group, which holds the master lease on the space.
Barlington Group is subleasing the space, which has been empty for five years, to the restaurants and night life operators. The partners declined to disclose the operators' names, but said each will have between 1,000 and 9,000 square feet of space.
Macy's will continue to occupy the east building.
"The idea is to create a night life scene and by doing that increase the foot traffic and pedestrian feel of the neighborhood at night," Fuller said.
-- INA PAIVA CORDLE
Read more: http://www.miamiherald.com/2011/01/05/2000823/downtown-miami-to-get-6-new-restaurants.html#ixzz1AB1D6xQ4
Six new restaurants and night life operators are expected to occupy 20,000 square feet on the ground floor of Macy's west building, 2 W. Flagler St., in downtown Miami by June 1, said Bill Fuller and Martin Pinilla II, managing partners of the Miami-based Barlington Group, which holds the master lease on the space.
Barlington Group is subleasing the space, which has been empty for five years, to the restaurants and night life operators. The partners declined to disclose the operators' names, but said each will have between 1,000 and 9,000 square feet of space.
Macy's will continue to occupy the east building.
"The idea is to create a night life scene and by doing that increase the foot traffic and pedestrian feel of the neighborhood at night," Fuller said.
-- INA PAIVA CORDLE
Read more: http://www.miamiherald.com/2011/01/05/2000823/downtown-miami-to-get-6-new-restaurants.html#ixzz1AB1D6xQ4
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