Icon Brickell, downtown Miami’s largest condo complex, has swung from nearly empty to nearly sold out.
By TOLUSE OLORUNNIPA
tolorunnipa@MiamiHerald.com
A year ago, Miami’s Icon Brickell condo complex was a symbol of just about everything that had gone wrong during South Florida’s epic housing bust: Speculators had walked out on sales contracts, the towers were half-empty, and a group of lenders was making moves to foreclose.
Now, as Brazilians and Argentineans wage bidding wars for Icon’s bank-owned condos, the rapidly selling, 1,800-unit complex represents a few of the things that are going right in the region’s still-shaky housing market.
A little more than a year after a consortium of banks seized ownership of two of Icon Brickell’s three towers, more than 930 condos have sold, meaning the towers have gone from three-quarters empty to three-quarters sold. A third tower, which was not taken over by lenders, has sold 518 of its 520 units, according to data provided by Bal Harbour-based consultancy Condo Vultures.
Fortune International Realty, the marketing muscle brought on by Icon’s lenders to sell individual units, has focused its efforts on the bright spots of the troubled housing market: discounted prices, international appeal and the up-and-coming allure of downtown Miami.
“It’s beyond anybody’s expectation,” said Edgardo DeFortuna, president of Miami-based Fortune. “The bank expectation was it was going to be a three-year sellout. We’re going to sell out within 18 months, which is unbelievable.”
Fortune has moved some 527 units for a total of $244.5 million after beginning sales efforts last June, according to public records data provided by Condo Vultures.
In May, a Maryland company bought the 148-unit Viceroy Hotel in Icon’s third tower for $36.5 million, clearing out the last remaining inventory owned by Miami-based developer Related Group.
With the hotel sold and about 40 residential units selling each month, Icon’s road to health looks much clearer now than it did just 12 months ago.
DeFortuna predicts that the final 250 units will all be sold by the end of the year. Prices, which were slashed heavily to entice buyers last year, are even starting to rise again as inventory shrinks.
Icon’s turnaround highlights a number of trends in the overall housing market, which has seen condo sales soar despite record-high foreclosures, declining values and hard-to-obtain credit.
In Miami-Dade County, condo sales were up 94 percent in April, compared to a year earlier, a reflection of a growing international appetite to cash in on Miami’s condo bust while prices are low and the dollar is weak.
Projects like Icon Brickell have benefited immensely from international interest, with more than 70 percent of sales coming from foreign buyers who paid with cash.
“Ultimately the deciding factor of why Fortune was successful is that they had the [international] reach and they had the pricing,” said Peter Zalewski, principal at Condo Vultures. To market Icon, Fortune headed to South and Central America to meet with potential buyers and make its pitch.
“The first thing we did was to pack up and go to Argentina, Brazil and go to Mexico and educate people on this project,” said DeFortuna.
The company opened a sales center in Punta del Este, Uruguay, targeting wealthy South Americans as they visited the resort town.
Fortune also sought to rebrand and relaunch the turbulent Icon project locally, hosting parties on-site with abundant liquor and fur-wearing models, announcing price cuts in email blasts to brokers and launching an iPad application for the building.
Commercial real estate attorney Dan Mackler bought a two-bedroom unit in Tower 2 last year, drawn by the Brickell neighborhood and the off-peak prices.
“When I bought, I figured I was probably buying at the bottom of the market,” he said. “We didn’t buy it thinking it would be an investment, but we think it will prove to be a good investment.”
Another market-wide trend that has benefitted Icon: price-slashing.
To get buyers interested in the slow-moving project, Icon cut prices several times in 2010, shaving more than 40 percent off the pre-construction numbers.
Today, starting prices for Icon’s condos range from about $365,000 for a studio to $1.4 million for a penthouse, an average of about $440 per square foot. Agents say those prices are up double-digits in the last nine months.
During pre-construction sales in 2006, prices topped $600-per-square foot. A rash of speculators put down deposits on units the $1 billion luxury project with Philippe Starck decor, 100 Easter Island-style columns and a two-acre pool deck overlooking Biscayne Bay.
But as Related completed construction in 2008 and 2009, the real estate market plunged, and buyers walked away from their purchase contracts en masse.
The project was the largest of a handful of condos that Related struggled to sell, and eventually lost to foreclosure, during the housing collapse. Those projects cost the company about $1 billion, Related founder Jorge Perez said.
Still, Perez believes the development of downtown Miami, anchored by Icon Brickell, was worth the trouble and the costs, especially now that Icon is filling up with buyers and renters.
“In a year and a half, we’ve sold 1,500 units—in a depression. That’s an amazing number,” said Perez, who considers Icon his favorite project. “It is the most prominent building in the new downtown. Bar none.”
Public records show that there are about about 340 bank-owned units left to sell at Icon, although Fortune says many of those are pending sales just waiting to close and the number is actually closer to 230.
To find buyers for the final units, which are generally the most difficult to sell, the broker is shifting some of its marketing efforts to well-heeled New Yorkers and Europeans.
DeFortuna is already tuning up a new sales pitch, as the project gets closer to selling out.
“Now that the building’s stable, this is going to be a success,” he said. “You can never replicate this in the future because the prices are below replacement costs.”
If you are looking to buy one of the last units available at Icon Brickell, call us today at 305-456-6456.
No comments:
Post a Comment