Developers in Greater Downtown Miami are on pace to ultimately build as many new towers and units in this South Florida condo boom as they did during the last cycle.
The possibility of matching the number of new condos from the last boom moved closer to reality last week, when development group NR Investments announced plans for what equates to the 60th new condo tower – named Canvas – in Greater Downtown Miami.
Including Canvas, developers in this cycle are proposing nearly 18,000 units in Greater Downtown Miami, which stretches from the Julia Tuttle Causeway south to the Rickenbacker Causeway and Biscayne Bay west to I-95, according to the preconstruction condo projects website CraneSpotters.com.
(For disclosure purposes, my firm operates the website.)
By comparison, developers created 84 new condo towers with more than 22,200 units during last decade’s real estate boom in Greater Downtown Miami. Less than 375 new condo units created in Greater Downtown Miami during the previous cycle were still unsold as of the first quarter of 2014, according to government records.
Overall, Greater Downtown Miami now accounts for nearly 52 percent of the more than 34,725 new condo units proposed east of I-95 in the tri-county South Florida region of Miami-Dade, Broward and Palm Beach counties.
The Hollywood / Hallandale Beach market in Southeast Broward County ranks as the second-most active preconstruction condo market in South Florida with less than 3,000 proposed units.
New condo development in Greater Downtown Miami is so popular right now that builders are now proposing new residential towers in unproven locations away from the water, established neighborhoods and existing retail centers.
For example, the newly proposed Canvas is slated to be developed upon a nearly 1.1-acre site located in the 1600 block of Northeast First Avenue, between the emerging Edgewater neighborhood to the east and the numerous blocks of vacant lots surrounding the Miami-Dade County Homeless Trust’s Homeless Assistance Center to the west in the Biscayne Boulevard Corridor of Greater Downtown Miami.
During the last South Florida real estate boom, developers that attempted to build in that same area of Greater Downtown Miami had mixed results.
The Parc Lofts condo project – the first condo tower to come online in the area – was successful upon its completion at 1749 NE Miami Court in 2005, the peak of the last South Florida condo boom.
The results were dramatically different across the street at 1650 NE Miami Court for the Filing Station Lofts project that stood partially constructed for years after the condo market crashed.
In January 2013, the Filing Station project was purchased for nearly $8.6 million by NR Investments, which proceeded to build out the 10-story tower as rental apartments.
Now for the proposed Canvas condo tower, NR Investments announced its intention to revive – and dramatically revise – a previously approved mixed-use project originally planned by a different developer for the site.
The original project – called the Max Miami during the last South Florida real estate boom – was slated to stand 31-stories tall with 28 residential units, 168 hotel rooms, nearly 50,300 square feet of retail space, about 250,000 square feet of office space and 1,139 parking spaces, according to City of Miami records.
As part of the new plan, NR Investments – which acquired the site in December 2013 for $7.3 million as a result of a bankruptcy auction – filed an application with the city to revise the original project to allow a 36-story condo tower with 513 units, nearly 10,000 square feet of retail space and 588 parking spaces.
The Miami Planning, Zoning and Appeals Board is scheduled to hear NR Investments’ application for the proposed Canvas condo tower on Wednesday.
The unanswered question going forward is whether developers will be confident enough to propose more new condos in emerging areas of Greater Downtown Miami, given that more than 80 percent of the total number of new units created during the previous real estate boom is already planned.
Peter Zalewski is real estate columnist for The Real Deal who founded Condo Vultures LLC, a consultancy and publishing company, as well as Condo Vultures Realty LLC and CVR Realty brokerages and the Condo Ratings Agency, an analytics firm. The Condo Ratings Agency operates CraneSpotters.com, a preconstruction condo projects website, in conjunction with the Miami Association of Realtors.