Miami’s top builders let go of bad memories and step up to meet demand

It’s anybody’s guess whether real estate in South Florida is headed for another bust, but the boom is clearly on.

All the demand, especially for condos, is drying up inventory. And developers are ginning up projects, refusing to be haunted by the bad times of only a few years ago.

Right now, Miami-Dade, Palm Beach and Broward counties have nearly 15,000 condo units in preconstruction and work is underway on 16 projects, according to data from Condo Vultures, the Miami real estate consulting firm.

Of that, the 10 most active developers have 9,011 units in the planning stages or under construction.

And as new projects are announced seemingly every day, those numbers don’t even include Echo Brickell, a 750-foot tower with 175 units in Downtown Miami that Property Markets Group unveiled in mid-April. The project turns PMG into one of the key players in the market.

“South Florida is in the midst of another condo construction boom,” Condo Vultures principal Peter Zalewski said. “Contributing to the sense that the market is stable for the time being is the fact that today’s preconstruction buyers are committing to 50 percent deposits based on the contracted purchase price.”

During the last boom, by contrast, most buyers put down 20 percent, he added.

With the outlook rosy, The Real Deal looked at this coming wave of condos to size up the most active developers when it comes to both preconstruction and construction, as the ranking of the busiest builders on the following page shows.

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In the top spot is Jorge Perez’s Related Group, with 2,152 units.

At the moment, Related has nine projects and is seeing the returns — big time.

Perez broke ground just a couple of months ago on 1100 Millecento Residences, by noted Italian designer Pininfarina, but already the $105 million Brickell project is 99 percent sold; of the 382 homes, two are still available, according to the project’s website.

About 20 miles away, in Hallandale Beach, another Related project — Apogee Beach — is more than 90 percent sold; only three of the 49 homes are still on the market. Work on the luxury 23-story tower, one of the first new condo developments launched after the financial crisis, started in December 2011 and will be wrapped up later this year.

In second place, with 1,824 units, is Florida East Coast Realty, led by Tibor Hollo. South Florida’s elder statesman of development has embraced a much different strategy than Perez — fewer but bigger projects, such as the $1.8 billion One Bayfront Plaza in the heart of Miami. The 80-story tower will have a bit of everything: 700 luxury residences, an 841-room top-flight hotel, three levels of retail shops and 40 floors of offices. When the skyscraper opens in 2018, it will stand 1,010 feet, making it the tallest building in Miami.

Swire Properties and Malaysian-based Genting Group rank third and fourth, respectively, and embrace the same bold development model — a single but monumental mixed-use project.

Swire is spending roughly $1.05 billion on the 9-acre, 5.4 million-square-foot Brickell CityCentre project, which will include a luxury shopping center, three towers with 1,174 residences, a hotel, a wellness center and Class A office space.

Genting is building 1,000 condos and a 500-room hotel as part of its gigantic downtown project, dubbed Resorts World Miami, on the 13.9-acre bayfront site that includes the former headquarters of the Miami Herald and the Omni International Mall. The developer plans to launch sales next year and is looking to sign a four-star operator for the hotel.

Though the developers have philosophies on size and use that run the gamut, their success hinges on their access to financing in this climate of still tight-fisted lending.

“Going forward, lenders are likely to play a crucial role in how this latest condo boom evolves,” Zalewski said. “If lenders competing for business weaken their developer requirements, the chance of another boom-and-bust cycle would obviously increase.”