Welcome to the Miami issue.
Questions about South Florida’s surge loom large and have meaning not just for the region but for the country. How long can a boom go on? And what’s on the other side — a bust or a soft landing?
The difference with a down cycle is that we’ve seen it before. It’s a familiar rut, not a black swan. Watch and wait, but don’t panic.
And the answer has a big impact because Miami became the land of opportunity, where developers could build and residents from elsewhere could relocate, and then developers could build some more. What if there’s not another spot like it?
“If Miami goes to shit or South Florida goes to shit, where are we all going to move to?” asks Robert Rivani, who’s become a standout in hospitality-focused real estate.
Our stories this month get at this from different sides. Katherine Kallergis, South Florida bureau chief and senior reporter, charts the yellow and red flags in the region. Lidia Dinkova tells the story of Lennar, the major homebuilder that has conquered the south of Miami-Dade county but is hedging its next leap by outsourcing land it will need in the future to other firms, who hold it for the meantime. Rivani, in his Closing interview, basically argues that those who are long on Miami need to make their own luck. He’s making his by micromanaging the renovation of a Miami Beach office project in order to land Playboy as a tenant and charge “Class X” (higher than Class A) rents.
Other optimists tend to believe that Miami is now in the ranks of cities like New York, where even if real estate encounters short-term trouble, the long-term forecast is always good.
“It’s really just a digestion of the immense amount of growth we had in a two-year time frame,” Keyes Company president Christina Pappas told reporter Jake Indursky, explaining away slowing home price growth and climbing days on market.
Miami’s not the only The Real Deal region that exists on a spinning planet, and Indursky’s story charts the regions around the U.S. where boomtowns have turned to buyer’s markets, in the blink of an eye, and opportunity might emerge in new places.
Stories about office chart a comeback in Boston and a comedown in Seattle before landing in New York City, where developers who spent half a decade avoiding the sector are now decoding signals that it’s time to get back in.
“The scope of the office comeback is unclear,” Senior Reporter Keith Larsen writes. “Institutional investors are still not making broad bets on office, but are surgically picking spots in sub-markets within a sub-market.” Behind the scenes, there’s still distress.
The biggest news of the month hit when Compass, the residential real estate behemoth, took a huge stride in its ruthless quest for market share, picking up competitor Anywhere in a deal that valued its brands at $1.6 billion. Reporter Sheridan Wall considers whether the deal gives Compass the firepower ($2.6 billion in debt, nearly 350,000 agents) to win the listing fight it started.
On a Sunday in late September, New York City Mayor Eric Adams announced he’d be dropping out of November’s race, leaving former Gov. Andrew Cuomo, running as an independent, to try to fend off Zohran Mamdani, who believes in higher taxes and constraints on rent prices. Columnist Erik Engquist gives an account of Adams’ real estate legacy. We might not have seen this race before, but the city has endured destructive policies from charming leaders in the past.
Reporter Lilah Burke checks in with developers hustling to finish 421a projects before the most lucrative version of the tax exemption expires. Her story also evokes a foregone era in the city where the government practically begged private developers to come build — maybe that’s part of the cycle we won’t see for a while.
This magazine also has rankings of the top general contractors and residential brokerages and brokers in South Florida, and a new feature called “Luxury Dossier” that organizes essential information for in-demand markets outside our usual coverage — first up, Aspen.
Enjoy the issue!