The South Florida condo market for years has been prone to extreme fluctuations, with a bust usually following a boom. But this time around might be different.
The currently thriving market, fueled by high demand, will be more sustainable, said Jon Paul Pérez, president of Coconut Grove-based Related Group.
“The major difference we are seeing for the future is that we have a much stronger domestic buyer. And that buyer is from companies, employers who are moving to South Florida and making it home,” he said. “And it’s not just a home where they are testing the water, they come down here for a little bit and see how it feels. They are signing 10-15 year leases.”
As out-of-state financial, tech and other firms have either expanded or moved to South Florida, their CEOs, executives and employees have followed, contributing to the condo buyer base.
Pérez spoke at The Real Deal’s seventh annual South Florida Real Estate Showcase and Forum, during a developer panel. He was joined by Menin Hospitality’s Keith Menin, Todd Michael Glaser and Dezer Development’s Gil Dezer on the panel moderated by TRD’s Hiten Samtani, at Mana Wynwood in Miami.
The developers agreed that the Miami residential market has room to grow, in light of the deluge of demand. They are also not too concerned about rising prices, and cited flowing financing.
“I think that we are actually keeping pricing in line with what we are selling. The sale on average at Armani is $1,250 a foot,” Dezer said, referring to the Armani/Casa project in Sunny Isles Beach he co-developed with Related.
Units at Dezer’s Porsche Design Tower, known for its dezervator car elevators in Sunny Isles Beach, are trading at $1,800 per square foot, in line with the city’s current market, he said. Dezer’s next Sunny Isles Beach venture is Bentley-branded condos.
Glaser, a single-family home developer, noted that at least some of the out-of-state homebuyers are attracted to the Mediterranean-style common for South Florida. He echoed a common sentiment: Regional newcomers are moving here permanently instead of seasonally.
Glaser also said there is room for real estate prices to rise further, especially for luxury properties.
Menin, who, aside from his hospitality ventures, designs and redevelops homes, said he does most of the financing on his own.
“We buy them, we fix them up and we either fix them or sell them,” Menin said, echoing Glaser’s sentiment for a preference of Mediterranean-style homes. His approach to home designs: “I just think what would I want,” Menin said.
Panelists attributed the booming residential market in part to strides the region has taken to grow, including the addition of the Formula One race.
“Miami has been evolving as a first class city for the past 20 years,” said Dezer, a past champion of the Gumball 3000 rally. “We are finally here.”