Sure, $2 million is a drop in the bucket for many of the buyers around Miami Beach's swank North Bay Road area where homes begin in this price range. But for these buyers, many of whom are visiting wealthy foreigners, the cash is burning a hole in their pocket. The traditional bank financing, down payment and mortgage are not part of their purchasing process.
"A cash buyer may be someone who is borrowing from somewhere on their own, they may have the money in the bank, they may own the bank, but their purchase is not contingent on a finance deal," Esther Percal, senior vice president of Esslinger Wooten Maxwell in Miami Beach, told HousingWatch.
Percal says 60 percent of the cash buyers she deals with hail from Europe and several South American countries. Her most recent was an Argentinian family whose unfortunate family incident has prompted them to make a move to the states and they chose Miami Beach for putting down roots. There's also the Brazilian businessman who does business in Tampa and Jacksonville and visits so often he decided to buy here. "For him, a $2 million purchase was a no-brainer and a $6 million one was a serious consideration," she said. There are also Venezuelan cash buyers, but not at these price ranges.
Europeans are the most prevalent cash buyers, and they're buying with a purpose. Many of them have been wanting to build credit here and when they plan to do business in the United States they want to establish a line of credit, perhaps even attain a VISA. They've got the cash and their own way of conducting business which oftentimes is not contingent on financing.
One prime example of such a buyer is a French businessman who Percal recently closed a deal for. Although he had the cash for his purchase, he still sought financing from the bank. He was financing through HSBC, known as the world's local bank, and was astounded at how lax business practices were in the U.S. He had a personal deadline to meet, but with the deal taking a total of two weeks, that did not fit with his schedule. He was surprised how long the surveys took and could not comprehend why the appraisals could not be done jointly. His frustration was so great, he called in a personal friend, the bank's president and asked him to lean on the folks to speed up the process.
"He personally complained to me and commented that his transaction's lengthy process was probably why U.S. banks are all in trouble, because they are slow and disorganized," Percal said.
This situation is actually very commonplace in this market where banks are being overly cautious. They are purposely appraising homes below value for example, a $1 million home is being appraised at $500,000 so non-cash buyers actually need much more of a down payment. In the luxury market, 10 to 20 percent for a down payment just doesn't cut it.
Percal says, "Cash is king. It has been a long time since most of us in luxury real estate have had to deal with financing and, frankly, cash buying relieves stress and alleviates red tape. This has been the case for the past two years."
There's optimism, though, that the market will bounce back, and brokers still say -- not surprisingly -- that real estate is still the most sound investment.
Source: http://www.housingwatch.com/2010/07/29/miami-beach-real-estate-market-awash-in-foreign-cash-buyers/
By Josie Gulliksen
The Criscitos has been selling South Florida luxury and commercial real estate for over a decade and has sold over $1 billion dollars of property. They work as a multi-lingual team speaking english, Spanish, Italian and Portuguese. They carved out a niche as a leading boutique real estate company with two distinct divisions -residential and commercial- both personally overseeing by Marcela and Anthony Criscito.
Friday, July 30, 2010
Thursday, July 29, 2010
Hopes rise with sales of downtown Miami condos
The idea of a vibrant city center in Miami is bolstered by a Downtown Development Authority finding that condo sales -- and prices -- are going up.
Residents and officials longing to see downtown Miami transformed into the nexus of a bustling, 24-hour city are beginning to see a little cooperation from the market.
Even as home prices have continued to drop across South Florida, downtown Miami -- the hub of the over-development that many believe sparked the housing market collapse -- seems poised for a comeback, a new study released by the Miami Downtown Development Authority shows.
The report found sales of downtown condos have accelerated during the first half of this year, and the inventory of empty new condos on the market is steadily declining. Prices are on the rise as well.
In the first six months of this year, there were 1,933 units sold in Miami's downtown area, which stretches from Brickell north to Midtown and from I-95 east to Biscayne Bay. That's an increase of 110 percent over the first six months of 2009, when 919 units closed.
``Downtown is an exciting place to be right now, with everything going on, and the report shows that people want to live downtown. They want to live in the heart of the city,'' said Leo Zabezhinsky, the DDA's manager of business development, real estate and research. Zabezhinsky moderated a downtown-themed discussion during the Greater Miami Chamber of Commerce's Real Estate Committee meeting on Tuesday.
The average sales price of a downtown home was $356,100 in the first six months of the year, up about 16 percent from the first two quarters of 2009, when the average unit sold for $306,700. For comparison, existing condo prices across Miami-Dade County dropped about 9 percent between June 2009 and June 2010 to $128,800.
The inventory of new, unsold condo units in the downtown area stood at an estimated 5,400 units as of June 30.
About half of the unsold units in the downtown area are in the Brickell area. The Central Business District, bounded by NE Fifth Street on the north and the Miami River on the south, contains nearly a quarter of the remaining new condo units.
At the current sales pace, downtown Miami's glut of new condos could be absorbed within the next 18 months, but there are a couple of caveats.
First, the DDA's numbers do not include the 870 units at the completed Mint at Riverfront and Paramount Bay buildings, currently empty but set to begin sales in the near future. Secondly, much of the sales activity has been generated by investors, who are largely expected to unload these properties back onto the market once prices rise and the housing picture brightens.
``Resale of investor-owned properties could continue for four or five years,'' said Craig Werley, president and owner of Focus Real Estate Advisors and one of the authors of the study.
In the meantime, those hoping that an active rental market can spur the type of downtown renaissance longed for by a growing group of supporters are encouraged by an occupancy rate inching towards 75 percent. The DDA's report shows leasing activity up 14 percent in the first six months of the year compared to 2009, with average rent down about 1 percent, to $1,787.
Another potential economic stimulator for the area, though still untested, is the arrival of the revamped Miami Heat team at downtown's AmericanAirlines Arena. With LeBron James, Chris Bosh and Dwyane Wade promising multiple championships, the effect on AAA's neighborhood could be transformative, said William Talbert III, president and CEO of the Greater Miami Convention and Visitors Bureau.
``Just think about all the restaurants that are going to open up,'' he said. ``You talk about a stimulus package -- that's one.''
But a number of major issues still hinder Miami's downtown from rivaling some of the other metropolitan hubs like Chicago and New York, said Sharon Dresser, co-founder of High Street Retail USA in Midtown.
The lack of flagship shopping destinations, inadequate public transportation between central downtown and areas like Midtown and the Design District and ``real or perceived'' safety issues all need to be addressed, she said.
``If you want to do serious shopping, you have to leave the downtown area,'' she said.
Source: http://www.miamiherald.com/2010/07/28/1749345/hopes-rise-with-sales-of-downtown.html
By TOLUSE OLORUNNIPA
tolorunnipa@MiamiHerald.com
Residents and officials longing to see downtown Miami transformed into the nexus of a bustling, 24-hour city are beginning to see a little cooperation from the market.
Even as home prices have continued to drop across South Florida, downtown Miami -- the hub of the over-development that many believe sparked the housing market collapse -- seems poised for a comeback, a new study released by the Miami Downtown Development Authority shows.
The report found sales of downtown condos have accelerated during the first half of this year, and the inventory of empty new condos on the market is steadily declining. Prices are on the rise as well.
In the first six months of this year, there were 1,933 units sold in Miami's downtown area, which stretches from Brickell north to Midtown and from I-95 east to Biscayne Bay. That's an increase of 110 percent over the first six months of 2009, when 919 units closed.
``Downtown is an exciting place to be right now, with everything going on, and the report shows that people want to live downtown. They want to live in the heart of the city,'' said Leo Zabezhinsky, the DDA's manager of business development, real estate and research. Zabezhinsky moderated a downtown-themed discussion during the Greater Miami Chamber of Commerce's Real Estate Committee meeting on Tuesday.
The average sales price of a downtown home was $356,100 in the first six months of the year, up about 16 percent from the first two quarters of 2009, when the average unit sold for $306,700. For comparison, existing condo prices across Miami-Dade County dropped about 9 percent between June 2009 and June 2010 to $128,800.
The inventory of new, unsold condo units in the downtown area stood at an estimated 5,400 units as of June 30.
About half of the unsold units in the downtown area are in the Brickell area. The Central Business District, bounded by NE Fifth Street on the north and the Miami River on the south, contains nearly a quarter of the remaining new condo units.
At the current sales pace, downtown Miami's glut of new condos could be absorbed within the next 18 months, but there are a couple of caveats.
First, the DDA's numbers do not include the 870 units at the completed Mint at Riverfront and Paramount Bay buildings, currently empty but set to begin sales in the near future. Secondly, much of the sales activity has been generated by investors, who are largely expected to unload these properties back onto the market once prices rise and the housing picture brightens.
``Resale of investor-owned properties could continue for four or five years,'' said Craig Werley, president and owner of Focus Real Estate Advisors and one of the authors of the study.
In the meantime, those hoping that an active rental market can spur the type of downtown renaissance longed for by a growing group of supporters are encouraged by an occupancy rate inching towards 75 percent. The DDA's report shows leasing activity up 14 percent in the first six months of the year compared to 2009, with average rent down about 1 percent, to $1,787.
Another potential economic stimulator for the area, though still untested, is the arrival of the revamped Miami Heat team at downtown's AmericanAirlines Arena. With LeBron James, Chris Bosh and Dwyane Wade promising multiple championships, the effect on AAA's neighborhood could be transformative, said William Talbert III, president and CEO of the Greater Miami Convention and Visitors Bureau.
``Just think about all the restaurants that are going to open up,'' he said. ``You talk about a stimulus package -- that's one.''
But a number of major issues still hinder Miami's downtown from rivaling some of the other metropolitan hubs like Chicago and New York, said Sharon Dresser, co-founder of High Street Retail USA in Midtown.
The lack of flagship shopping destinations, inadequate public transportation between central downtown and areas like Midtown and the Design District and ``real or perceived'' safety issues all need to be addressed, she said.
``If you want to do serious shopping, you have to leave the downtown area,'' she said.
Source: http://www.miamiherald.com/2010/07/28/1749345/hopes-rise-with-sales-of-downtown.html
By TOLUSE OLORUNNIPA
tolorunnipa@MiamiHerald.com
Friday, July 23, 2010
Miami Beach buyers turn to all-cash deals
A home at 4411 Pinetree Drive in Miami Beach Reluctant banks have led to a new wave of buyers in Miami Beach real estate --- those looking for quick, all-cash deals. With financing not just difficult to obtain but also time-consuming, sellers are looking to move their homes faster, and buyers, with cash lining their pockets, are ready to move on deals.
As has been the trend in Miami Beach, the new all-cash buyers are Europeans armed with easily accessible funds and are eager for quick deals on higher-end properties.
"With the state of the market being what it is, it's typically a 30- to 60-day process for financing," said Peter Zalewski, founder of Condo Vultures Realty. "If you want to come in with financing, you're going to have to put in a 15 to 20 percent premium. The seller would rather take less money and move it in 20 days."
Nelson Gonzalez, senior vice president at Esslinger-Wooten-Maxwell, said he has gone almost two years without buyers making a financed deal.
Many of these buyers are looking for second or third homes, so federal financing and tax credits were not an option -- just cash.
"People that have the cash are coming in out of the sidelines trying to make deals," he said. "Two years ago, the banks weren't lending, so that was the biggest issue.
Now, the money's there, they're just looking for deals," he added.
Gonzalez noted eight sales made on prestigious North Bay Road, in February of this year alone.
The trend is not limited to single-family homes, either.
Of 713 condo units in the Miami market that closed, 83 percent were all cash, according to a Condo Vultures study earlier in the year, at the end of the first quarter.
"People are buying all-cash," said realtor Yolande Citro. "It's very difficult to get a loan right now. I work with a lot of Europeans, and it's still a good deal with the Euro; a lot of buyers are European, and being from the old world, they like to buy cash."
Some of the most expensive deals in Miami Beach's condo market in the last quarter and a half were paid for in all cash, like three sales at the Apogee of over $4.2 million and the sale of Penthouse B at the Setai for $15 million, according to Diana Garchitorena of Setai Realty, the exclusive sales and marketing arm for the project.
"Because everyone wants to be in Miami Beach, all-cash is the way to get in," Zalewski of Condo Vultures said.
Source: http://therealdeal.com/miami/articles/miami-beach-buyers-turn-to-all-cash-deals
By Alexander Britell
As has been the trend in Miami Beach, the new all-cash buyers are Europeans armed with easily accessible funds and are eager for quick deals on higher-end properties.
"With the state of the market being what it is, it's typically a 30- to 60-day process for financing," said Peter Zalewski, founder of Condo Vultures Realty. "If you want to come in with financing, you're going to have to put in a 15 to 20 percent premium. The seller would rather take less money and move it in 20 days."
Nelson Gonzalez, senior vice president at Esslinger-Wooten-Maxwell, said he has gone almost two years without buyers making a financed deal.
Many of these buyers are looking for second or third homes, so federal financing and tax credits were not an option -- just cash.
"People that have the cash are coming in out of the sidelines trying to make deals," he said. "Two years ago, the banks weren't lending, so that was the biggest issue.
Now, the money's there, they're just looking for deals," he added.
Gonzalez noted eight sales made on prestigious North Bay Road, in February of this year alone.
The trend is not limited to single-family homes, either.
Of 713 condo units in the Miami market that closed, 83 percent were all cash, according to a Condo Vultures study earlier in the year, at the end of the first quarter.
"People are buying all-cash," said realtor Yolande Citro. "It's very difficult to get a loan right now. I work with a lot of Europeans, and it's still a good deal with the Euro; a lot of buyers are European, and being from the old world, they like to buy cash."
Some of the most expensive deals in Miami Beach's condo market in the last quarter and a half were paid for in all cash, like three sales at the Apogee of over $4.2 million and the sale of Penthouse B at the Setai for $15 million, according to Diana Garchitorena of Setai Realty, the exclusive sales and marketing arm for the project.
"Because everyone wants to be in Miami Beach, all-cash is the way to get in," Zalewski of Condo Vultures said.
Source: http://therealdeal.com/miami/articles/miami-beach-buyers-turn-to-all-cash-deals
By Alexander Britell
Thursday, July 22, 2010
New Heat players checking out Miami area's fancy home market
Since announcing he would be bringing his talents to South Beach, LeBron James has been called a one-man stimulus package for South Florida - but among the area's real estate circles, the Miami Heat's entire starting lineup looks like a walking, dribbling dollar sign. At least four of the Heat's highest-paid players are looking for a place to live.
With hundreds of millions of dollars of net worth combined, the Heat's newest acquisitions - James, Chris Bosh, Mike Miller and Zydrunas Ilgauskas - could each drop millions on a new South Florida pad in the coming months. Add Dwyane Wade to that list of high-end house-hunters - the Heat's top scorer recently sold his six-bedroom Pinecrest mansion, and with the ink still wet on his $107 million dollar, six-year contract, he's looking for flashy new digs.
With the influx of vertically gifted men with eight-figure salaries, real estate agents - and multimillionaires trying to sell their homes - are watching, speculating and maneuvering like a small forward aiming for an offensive rebound.
"The Realtors, some of them are desperately throwing themselves at these athletes," said real estate agent Hazel Goldman, who recently sold Wade's home in Pinecrest for $2.5 million. "They're trying to show that they're the ones that have the 'in' and know the market and know what to buy."
The ultra-luxury homes James, Wade and Bosh could buy are grandiose and unashamedly lavish, featuring expansive waterfront views, high-tech amenities and vaulted ceilings that could dwarf a seven-footer. Of course, there are multimillion-dollar price tags as well, meaning juicy commissions for the agents involved in the deal.
The top-echelon options might not be as plentiful as you think - about 70 homes and condos in Miami-Dade County, where most Heat players have lived, are on the market with prices above $10 million (about 360 are above the $4 million mark).
With only six of these homes and condos selling for more than $10 million so far this year, the Heat players' potential purchases could be a boost to that niche segment of the area's troubled housing market, said Ron Shuffield, president of Esslinger-Wooten-Maxwell Realtors
"There's a limited inventory of where they're going to look," he said. "There are 50 homes and 20 condos above $10 million. I'd say of those there are about 8 or 10 that they'll be considering."
James' six-year contract will add millions to his net worth, already estimated to be in the hundreds of millions thanks to seven years with the Cleveland Cavaliers and many high-profile endorsement deals. Bosh and Wade, who will both receive upwards of $13 million in the first year of their contracts, also have seven years of fat paychecks boosting their net worth. Being a resident of income-tax-free Florida will only increase their total take home pay.
The Heat's top trio - ages 25 to 28 - are close friends and could choose to live near each other in one of South Florida's top millionaire-friendly neighborhoods.
While most Heat players live in Miami-Dade, Broward County is not out of the running. Many ballplayers on the Florida Marlins and Miami Dolphins roster choose to live in Broward - Josh Johnson lives in Hallandale Beach and Hanley Ramirez lives in Weston - and a sleepy enclave in Plantation has housed at least a dozen professional athletes. But most agents expect the Heat players to opt for one of Miami-Dade's more famous and exclusive locales.
A $30 million mansion on private Fisher Island ranks among the most expensive homes on the market. The oceanfront 5-bedroom includes an in-balcony Jacuzzi, a conference center and high-end artwork. On Star Island, $29 million buys privacy on an 87,000-square-foot lot, and 304 feet of waterfront. Add a gazebo, resort-style pool, dozens of landscaped palm trees and two guest houses.
A home in the Tahiti Beach section of Coral Gables is on the market for $16.9 million. Selling points include a waterfront pool, more than 7,000 square feet of living space and enough land to install an outdoor basketball court.
If the agents listing these homes are meeting with the Heat stars, they aren't talking. The athletes are likely operating with strict confidentiality agreements, meaning the general public won't know where they've purchased until long after they've settled in.
But that doesn't stop the rumors from flying.
Gables Estates - a waterfront neighborhood that has housed a number of Heat elite including president Pat Riley - has been in the headlines recently as the potential locale of choice for James. In the days before James arrived in Miami, multiple Realtors heard that he had put in an offer on Alan Potamkin's $49.5 million mansion. The blogosphere lit up with the rumor, which eventually landed in Life & Style magazine, with the tabloid calling it a "slam dunk."
Potamkin cleared the air this week, stating that he had never been in contact with James.
"I have no idea how rumors like this get started," Potamkin told The Miami Herald this week. "I have no intention of selling my house."
That leaves hope for a number of listing agents looking to cash in on James' home purchase, likely to be the most extravagant of the Heat's buyers. Selling the super-star a mega-mansion, would net the lucky Realtor a hefty commission as well as the resume-boosting cache that comes with such a high-profile deal.
"It's very competitive," said Alex Shay, a Miami Beach luxury Realtor. "Sometimes you'll get an athlete and a celebrity by a phone call, by a listing you have, or simply if the athlete's agent likes you."
Shuffield, whose company has two of the 10 most expensive local properties on the market, said having a solid reputation and many high-end sales under your belt counts when big names come into a new market looking for a home.
"We've worked with a lot of people - Fortune 500 CEOs, owners of teams, community leaders," he said. "Our business is a relationship business.
Goldman, who sits on the board of an exclusive club of 250 Realtors called the Master Brokers Forum, said most of the agents competing for the Heat players know each other, and many agents are going to great lengths to one-up their competition. Some are updating their personal blogs and websites to reflect the vibe of South Beach's celebrity party scene, she said, questioning the authenticity of such moves.
"No one who is really working in real estate has time to party with the stars right now," she said.
Goldman, along with partner Denise Madan, made their pitch by sending Wade's agent a letter indicating interest in working with the star guard again as he looks for a new place. They even offered to give a portion of the sales commission to Wade's charity.
Like many agents hoping to score a deal this summer, they're still waiting on a response, but she said regardless of whether she is personally involved in a Heat player deal, the entire community benefits from having a team of all-stars living in South Florida.
"The good news is that our community has a tremendous amount of hype and the excitement," she said. "And all of that is good for Miami."
Source: http://www.kansascity.com/2010/07/20/2096862/new-heat-players-checking-out.html
Miami Herald sportswriter Barry Jackson contributed to this report.
With hundreds of millions of dollars of net worth combined, the Heat's newest acquisitions - James, Chris Bosh, Mike Miller and Zydrunas Ilgauskas - could each drop millions on a new South Florida pad in the coming months. Add Dwyane Wade to that list of high-end house-hunters - the Heat's top scorer recently sold his six-bedroom Pinecrest mansion, and with the ink still wet on his $107 million dollar, six-year contract, he's looking for flashy new digs.
With the influx of vertically gifted men with eight-figure salaries, real estate agents - and multimillionaires trying to sell their homes - are watching, speculating and maneuvering like a small forward aiming for an offensive rebound.
"The Realtors, some of them are desperately throwing themselves at these athletes," said real estate agent Hazel Goldman, who recently sold Wade's home in Pinecrest for $2.5 million. "They're trying to show that they're the ones that have the 'in' and know the market and know what to buy."
The ultra-luxury homes James, Wade and Bosh could buy are grandiose and unashamedly lavish, featuring expansive waterfront views, high-tech amenities and vaulted ceilings that could dwarf a seven-footer. Of course, there are multimillion-dollar price tags as well, meaning juicy commissions for the agents involved in the deal.
The top-echelon options might not be as plentiful as you think - about 70 homes and condos in Miami-Dade County, where most Heat players have lived, are on the market with prices above $10 million (about 360 are above the $4 million mark).
With only six of these homes and condos selling for more than $10 million so far this year, the Heat players' potential purchases could be a boost to that niche segment of the area's troubled housing market, said Ron Shuffield, president of Esslinger-Wooten-Maxwell Realtors
"There's a limited inventory of where they're going to look," he said. "There are 50 homes and 20 condos above $10 million. I'd say of those there are about 8 or 10 that they'll be considering."
James' six-year contract will add millions to his net worth, already estimated to be in the hundreds of millions thanks to seven years with the Cleveland Cavaliers and many high-profile endorsement deals. Bosh and Wade, who will both receive upwards of $13 million in the first year of their contracts, also have seven years of fat paychecks boosting their net worth. Being a resident of income-tax-free Florida will only increase their total take home pay.
The Heat's top trio - ages 25 to 28 - are close friends and could choose to live near each other in one of South Florida's top millionaire-friendly neighborhoods.
While most Heat players live in Miami-Dade, Broward County is not out of the running. Many ballplayers on the Florida Marlins and Miami Dolphins roster choose to live in Broward - Josh Johnson lives in Hallandale Beach and Hanley Ramirez lives in Weston - and a sleepy enclave in Plantation has housed at least a dozen professional athletes. But most agents expect the Heat players to opt for one of Miami-Dade's more famous and exclusive locales.
A $30 million mansion on private Fisher Island ranks among the most expensive homes on the market. The oceanfront 5-bedroom includes an in-balcony Jacuzzi, a conference center and high-end artwork. On Star Island, $29 million buys privacy on an 87,000-square-foot lot, and 304 feet of waterfront. Add a gazebo, resort-style pool, dozens of landscaped palm trees and two guest houses.
A home in the Tahiti Beach section of Coral Gables is on the market for $16.9 million. Selling points include a waterfront pool, more than 7,000 square feet of living space and enough land to install an outdoor basketball court.
If the agents listing these homes are meeting with the Heat stars, they aren't talking. The athletes are likely operating with strict confidentiality agreements, meaning the general public won't know where they've purchased until long after they've settled in.
But that doesn't stop the rumors from flying.
Gables Estates - a waterfront neighborhood that has housed a number of Heat elite including president Pat Riley - has been in the headlines recently as the potential locale of choice for James. In the days before James arrived in Miami, multiple Realtors heard that he had put in an offer on Alan Potamkin's $49.5 million mansion. The blogosphere lit up with the rumor, which eventually landed in Life & Style magazine, with the tabloid calling it a "slam dunk."
Potamkin cleared the air this week, stating that he had never been in contact with James.
"I have no idea how rumors like this get started," Potamkin told The Miami Herald this week. "I have no intention of selling my house."
That leaves hope for a number of listing agents looking to cash in on James' home purchase, likely to be the most extravagant of the Heat's buyers. Selling the super-star a mega-mansion, would net the lucky Realtor a hefty commission as well as the resume-boosting cache that comes with such a high-profile deal.
"It's very competitive," said Alex Shay, a Miami Beach luxury Realtor. "Sometimes you'll get an athlete and a celebrity by a phone call, by a listing you have, or simply if the athlete's agent likes you."
Shuffield, whose company has two of the 10 most expensive local properties on the market, said having a solid reputation and many high-end sales under your belt counts when big names come into a new market looking for a home.
"We've worked with a lot of people - Fortune 500 CEOs, owners of teams, community leaders," he said. "Our business is a relationship business.
Goldman, who sits on the board of an exclusive club of 250 Realtors called the Master Brokers Forum, said most of the agents competing for the Heat players know each other, and many agents are going to great lengths to one-up their competition. Some are updating their personal blogs and websites to reflect the vibe of South Beach's celebrity party scene, she said, questioning the authenticity of such moves.
"No one who is really working in real estate has time to party with the stars right now," she said.
Goldman, along with partner Denise Madan, made their pitch by sending Wade's agent a letter indicating interest in working with the star guard again as he looks for a new place. They even offered to give a portion of the sales commission to Wade's charity.
Like many agents hoping to score a deal this summer, they're still waiting on a response, but she said regardless of whether she is personally involved in a Heat player deal, the entire community benefits from having a team of all-stars living in South Florida.
"The good news is that our community has a tremendous amount of hype and the excitement," she said. "And all of that is good for Miami."
Source: http://www.kansascity.com/2010/07/20/2096862/new-heat-players-checking-out.html
Miami Herald sportswriter Barry Jackson contributed to this report.
Monday, July 19, 2010
Lebron James Will Help Market Miami Internationally
Just as in Cleveland, Lebron James looks to have a positive impact, not just on the Miami Heat’s chances of winning a championship, but on the overall economy of the Miami area as a whole.
William Talbert, president of the Greater Miami Convention & Visitors Bureau, told USA Today that James’ decision could be worth millions to the market.
“LeBron’s arrival has effectively changed the conversation in the press from real estate bust and foreclosures to Miami glitz and glam,” Tadd Schwartz, principal with Schwartz Media Strategies, told the South Florida Business Journal.
The Journal reports that with James’ arrival comes the profiling of downtown’s transformation, resurgent condo activity and robust nightlife amid the urban core, Schwartz said. “LeBron affirmed that when he chose Miami.”
There is expected to be heavy foot traffic as a result of the Miami Heat games.
“In next two to three weeks, nuances and messages will start to emerge. We will have to find what’s resonating with the media,” said Robert Geitner, senior manager for marketing and communications with the DDA. “People are discovering there’s more to Miami than great beaches and hot spots on Ocean Drive.”
Bruce Turkel, CEO and executive creative director with Turkel in Coconut Grove, tells the Journal the big winner in James move to South Florida is tourism.
“It’s just another reason people want to be here – even for people who don’t like basketball.”
Submitted by C Costigan on Fri, 07/16/2010 - 19:40
William Talbert, president of the Greater Miami Convention & Visitors Bureau, told USA Today that James’ decision could be worth millions to the market.
“LeBron’s arrival has effectively changed the conversation in the press from real estate bust and foreclosures to Miami glitz and glam,” Tadd Schwartz, principal with Schwartz Media Strategies, told the South Florida Business Journal.
The Journal reports that with James’ arrival comes the profiling of downtown’s transformation, resurgent condo activity and robust nightlife amid the urban core, Schwartz said. “LeBron affirmed that when he chose Miami.”
There is expected to be heavy foot traffic as a result of the Miami Heat games.
“In next two to three weeks, nuances and messages will start to emerge. We will have to find what’s resonating with the media,” said Robert Geitner, senior manager for marketing and communications with the DDA. “People are discovering there’s more to Miami than great beaches and hot spots on Ocean Drive.”
Bruce Turkel, CEO and executive creative director with Turkel in Coconut Grove, tells the Journal the big winner in James move to South Florida is tourism.
“It’s just another reason people want to be here – even for people who don’t like basketball.”
Submitted by C Costigan on Fri, 07/16/2010 - 19:40
Friday, July 16, 2010
Miami Beach's Seville Hotel gets a rebirth
Ian Schrager, the celebrity hotelier who invigorated South Beach with his launch of the Delano hotel 15 years ago, is coming back to the beach.
Through a partnership with Marriott, Schrager is set to turn the shuttered 12-story Seville Beach Hotel into a boutique property under the new Edition brand.
The new venture, confirmed Thursday by Marriott, is just the second announced U.S. location under the new brand. The first is scheduled to open this fall in Honolulu.
Marriott spokesman John Wolf said the South Florida hotel, which sits on nearly three acres of beachfront property at 2901 Collins Ave., is expected to open in three years after significant renovations.
``Edition has tremendous growth potential and this hotel will be a flagship to showcase the brand,'' said Marriott International CFO Carl Berquist in a conference call with investors.
Thursday's announcement adds a new whiff of hip to the Beach scene, still basking in the glow of basketball star LeBron James' decision last week to call the area home. And it comes at a time when few comparable projects are on the horizon.
Schrager left Miami Beach a few years ago with the sale of his interest in the Morgans Hotel Group.
In recent years, Schrager has focused on luxury residences and a hotel in New York City and on the creating the Edition brand, aimed at sophisticated travelers.
His return to the beach is being heralded as a renewal after a tough patch for South Beach hotels, with several high-profile properties stressed by the economy.
``The Delano has the vibe or whatever . . . and Schrager was the marketing genius behind it,'' said Scott Brush, an independent hotel consultant based in Miami-Dade. ``With him involved with this, I don't think there's any way that it won't be successful.''
Some of Miami Beach's hottest hotels, the W and the Gansevoort, are several blocks south of the Seville; the Fontainebleau Resort lies 15 blocks north. The action between is subdued.
``For locals, this was an area that you avoided,'' said Peter Zalewski, a principal at real estate consultancy Condo Vultures. ``Or if you drove through it, you went really fast.''
He wondered how easy it would be to translate a massive older resort into ``boutique chicness,'' but called Marriott a pioneer for moving into the area.
``This is a tremendous economic boost,'' he said. ``It's going to fill in the gap between south of Fifth and the Fontainebleau. This is the piece that's necessary to bridge.''
The 278,547-square-foot Seville, built in 1955, previously attempted a comeback. In 2005, developers announced plans to turn it into a condo and fractional ownership complex with the Ritz-Carlton name, despite three Ritz-Carlton properties already in the area. Marriott owns the Ritz-Carlton brand.
Part of the old property would have been knocked down to make room for two 21-story towers, but the project couldn't get off the ground as lenders balked in an unfriendly credit market.
Marriott acquired the property recently in a $57.5 million short sale from owner 2901 Beach Ventures, a partnership between Lionstone Group -- led by Alfredo Lowenstein -- and Fortune International Management, records show. That's nearly $10 million less than a foreclosure lawsuit that had been filed on the property, which has since been dismissed.
Marriott does not expect to be the property's long-term owner, Berquist said Thursday in a conference call for investors.
Marriott owns few properties that bear its name, instead franchising or managing hotels for owners under long-term contracts.
Marriott's portfolio includes the luxury brand Ritz-Carlton, the upscale JW Marriott, ``quality'' brands including Marriott and Renaissance and moderate hotels Courtyard by Marriott and Fairfield Inn by Marriott. In addition to Edition, it also recently created the Autograph Collection, currently featuring 10 hotels with an individualistic ambience.
Edition seeks to set itself apart by creating individualized hotels in busy markets that reflect the cultures of their surroundings with an emphasis on sophistication and service. Other planned Edition locations include Mexico City, Bangkok, Istanbul and Barcelona.
Schrager and Marriott announced the partnership three years ago. Initially, plans called for the South Beach Marriott at 161 Ocean Dr. to become an Edition, but that failed to materialize as the recession hit.
``We continue to explore other opportunities in the market, including the South Beach Marriott, but that project has been delayed due to market and other conditions,'' Marriott spokesman John Wolf said.
Brush said he expects success from the hotel once it opens in a few years.
``It'll be well into an economic recovery and there is very little opportunity for additional supply out on the beach,'' he said.
Source: http://www.miamiherald.com/2010/07/16/1732723/under-ian-schragers-direction.html
BY HANNAH SAMPSON
hsampson@MiamiHerald.com
Miami Herald staff writer Douglas Hanks contributed to this report.
Through a partnership with Marriott, Schrager is set to turn the shuttered 12-story Seville Beach Hotel into a boutique property under the new Edition brand.
The new venture, confirmed Thursday by Marriott, is just the second announced U.S. location under the new brand. The first is scheduled to open this fall in Honolulu.
Marriott spokesman John Wolf said the South Florida hotel, which sits on nearly three acres of beachfront property at 2901 Collins Ave., is expected to open in three years after significant renovations.
``Edition has tremendous growth potential and this hotel will be a flagship to showcase the brand,'' said Marriott International CFO Carl Berquist in a conference call with investors.
Thursday's announcement adds a new whiff of hip to the Beach scene, still basking in the glow of basketball star LeBron James' decision last week to call the area home. And it comes at a time when few comparable projects are on the horizon.
Schrager left Miami Beach a few years ago with the sale of his interest in the Morgans Hotel Group.
In recent years, Schrager has focused on luxury residences and a hotel in New York City and on the creating the Edition brand, aimed at sophisticated travelers.
His return to the beach is being heralded as a renewal after a tough patch for South Beach hotels, with several high-profile properties stressed by the economy.
``The Delano has the vibe or whatever . . . and Schrager was the marketing genius behind it,'' said Scott Brush, an independent hotel consultant based in Miami-Dade. ``With him involved with this, I don't think there's any way that it won't be successful.''
Some of Miami Beach's hottest hotels, the W and the Gansevoort, are several blocks south of the Seville; the Fontainebleau Resort lies 15 blocks north. The action between is subdued.
``For locals, this was an area that you avoided,'' said Peter Zalewski, a principal at real estate consultancy Condo Vultures. ``Or if you drove through it, you went really fast.''
He wondered how easy it would be to translate a massive older resort into ``boutique chicness,'' but called Marriott a pioneer for moving into the area.
``This is a tremendous economic boost,'' he said. ``It's going to fill in the gap between south of Fifth and the Fontainebleau. This is the piece that's necessary to bridge.''
The 278,547-square-foot Seville, built in 1955, previously attempted a comeback. In 2005, developers announced plans to turn it into a condo and fractional ownership complex with the Ritz-Carlton name, despite three Ritz-Carlton properties already in the area. Marriott owns the Ritz-Carlton brand.
Part of the old property would have been knocked down to make room for two 21-story towers, but the project couldn't get off the ground as lenders balked in an unfriendly credit market.
Marriott acquired the property recently in a $57.5 million short sale from owner 2901 Beach Ventures, a partnership between Lionstone Group -- led by Alfredo Lowenstein -- and Fortune International Management, records show. That's nearly $10 million less than a foreclosure lawsuit that had been filed on the property, which has since been dismissed.
Marriott does not expect to be the property's long-term owner, Berquist said Thursday in a conference call for investors.
Marriott owns few properties that bear its name, instead franchising or managing hotels for owners under long-term contracts.
Marriott's portfolio includes the luxury brand Ritz-Carlton, the upscale JW Marriott, ``quality'' brands including Marriott and Renaissance and moderate hotels Courtyard by Marriott and Fairfield Inn by Marriott. In addition to Edition, it also recently created the Autograph Collection, currently featuring 10 hotels with an individualistic ambience.
Edition seeks to set itself apart by creating individualized hotels in busy markets that reflect the cultures of their surroundings with an emphasis on sophistication and service. Other planned Edition locations include Mexico City, Bangkok, Istanbul and Barcelona.
Schrager and Marriott announced the partnership three years ago. Initially, plans called for the South Beach Marriott at 161 Ocean Dr. to become an Edition, but that failed to materialize as the recession hit.
``We continue to explore other opportunities in the market, including the South Beach Marriott, but that project has been delayed due to market and other conditions,'' Marriott spokesman John Wolf said.
Brush said he expects success from the hotel once it opens in a few years.
``It'll be well into an economic recovery and there is very little opportunity for additional supply out on the beach,'' he said.
Source: http://www.miamiherald.com/2010/07/16/1732723/under-ian-schragers-direction.html
BY HANNAH SAMPSON
hsampson@MiamiHerald.com
Miami Herald staff writer Douglas Hanks contributed to this report.
Wednesday, July 14, 2010
Miami's Downtown Comes Alive as Condos Fill With Renters
Brandon Klein has done what few Floridians can: go weeks without driving his car.
The 26-year-old tax accountant walks three blocks from his condominium tower on Biscayne Bay in Miami to his office at Deloitte LLP. On weekends, he and his friends hang out on the pool deck or share a cab to a local Irish pub.
He lives in Downtown, a neighborhood where young people are renting condos built during the 2004 to 2008 boom to attract second-home buyers. Thanks to the housing crash, Klein and two roommates pay about $900 a month each for a wraparound balcony, water views and access to a gym, spa and steam room.
“Five years ago you wouldn’t have kids fresh out of college living in luxury like this,” said Klein, sitting in front of the 24-hour concierge in the three-story lobby of his building at 50 Biscayne Boulevard, coordinating happy-hour plans by text message. His friends are concentrated in nearby Met I, which has 447 luxury units and a steakhouse on the first floor. They refer to the building as “Deloitte Dorm” because it’s home to so many employees of the accounting and consulting firm.
The 7,000 unsold condos in Miami’s core -- a symbol of a building boom that collapsed and dragged the city into recession -- are filling up and giving life to neighborhoods that previously closed after dark. New, year-round residents are cramming into restaurants, nightclubs and bars that didn’t exist a few years ago, and enjoying a lifestyle made possible in part by developers and banks seeking to recoup losses by renting luxury dwellings until the market recovers.
Creating A City
“I’m a big city person, and I always thought Miami didn’t have a real city,” said Dejan Krsmanovic, a 39-year-old biomedical engineer who was on a first date at Segafredo, a busy Italian restaurant and bar that opened in 2008 in the adjacent Brickell neighborhood, where the same trend is playing out.
“Miami Beach is not a city, it’s a resort,” he said. “This is beginning to resemble a city.”
The unsold condos represent almost a third of the 22,079 units in 75 buildings, mostly opened after 2004, tracked in a study released in March by the Miami Downtown Development Authority. The report focused on central neighborhoods including Downtown, Brickell and Wynnwood/Edgewater.
Occupancy rates in the new buildings, including owner- occupants and tenants, increased to 74 percent in February from 62 percent in May 2009, the study shows.
Price Cuts
The development authority estimates that the population of Miami’s urban core jumped to about 70,000 from 40,000 since the 2000 census, said authority spokesman Robert Geitner.
“For us, it doesn’t matter whether they rent or buy,” said Miami Mayor Tomás P. Regalado. “The more people, the more business, the more safety, the more progress.”
The influx of college students, young professionals and empty nesters from the Coral Gables section of the city and the suburbs intensified about 18 months ago when banks that financed the condo projects agreed to let developers slash sales prices by as much as 40 percent, said Peter Zalewski, a principal with consulting firm Condo Vultures LLC in Miami. That spurred demand from foreign buyers and all-cash investors, many of whom are renting out their units until prices rebound, he said.
The Miami metro rental market is one of the strongest in the country, according to Ron Johnsey, president of Axiometrics Inc., an apartment-research firm in Dallas. That’s the case even though unemployment is more than 11 percent, compared with 9.5 percent nationally, and developers are adding to supply by leasing units built for purchase.
Rents Rise
Effective rents, the amounts actually received by landlords, rose 4 percent in the first five months of the year after falling 2.9 percent during the same period in 2009, according to Axiometrics, whose data tracks professionally managed rental building. Nationally, rents increased 2.75 percent from January to May.
The occupancy rate for Miami climbed to 95.1 percent in May from 93.8 percent a year earlier, Johnsey said.
Condos are being purchased by investors and rented out in Phoenix, San Diego and Las Vegas, where thousands of units also went up during the boom, according to Ross Moore, chief economist for Colliers International, a Seattle-based real estate services firm.
“It’s something we’re seeing in many markets,” he said. “Miami is an absolute extreme example.”
Holding Out Hope
While the city is heading in the right direction, it will take years to fully recover, said Michael Fratantoni, vice president of single-family research and policy at the Mortgage Bankers Association in Washington.
“Miami has been one of the areas most deeply impacted by the crisis,” he said. “But the backstop of foreign-buyer demand is going to help Miami do better than the rest of the state.”
Builders haven’t given up on finding buyers for their condos. At the Axis on Brickell, developed by Brack Capital Group, about 85 percent of the 718 units are rented, said Albert Piazza, the project manager. The firm has sold about 239 condos at the complex, which features poolside cabanas, a theater and a billiards room, and is allowing tenants to direct 50 percent of their rent toward purchase. Once credit for mortgages frees up, Piazza expects many of them to act, he said.
“The goal is still to sell out,” Piazza said.
Occupancy Rates
T. Sinclair Jacobs, 87, who founded the Brickell Homeowners Association 20 years ago, watched the developments go up. The group’s original residents lived south of Southeast 15th Road, along Brickell Avenue, in decades-old condo towers, some of which appeared in the “Miami Vice” television series, according to Geitner. Developers then pushed north 13 blocks, putting up about 25 projects along Brickell Avenue, known for its bank buildings.
Development crossed the Miami River to connect with Downtown, adding glass-and-steel residential towers to the area’s mix of courthouses, hotels, warehouses, homeless shelters and stores. The American Airlines Arena, where LeBron James will play next season with the National Basketball Association’s Miami Heat, opened there in 1999.
While Jacobs believes the projects needed better planning, he said they are making Miami a better place to live.
“With the greater concentration of residents, there’ll be a beneficial effect on traffic because we’ll have better public transportation,” he said. “We didn’t have the residents before to support mass transit. In the long run, this is going to be one of the great cities in the world.”
Softening Recession’s Pain
The new vitality can be seen at Juan Chipoco’s sleek Peruvian restaurant, CVI.CHE 105, on Northeast 3rd Avenue off of East Flagler Street, in the heart of the old Downtown shopping area. Chipoco, who finished expanding to 220 seats from 65 seats three months ago, said lines sometimes form on weekends even with a $10 valet fee and limited parking. The restaurant also draws customers from Miami Beach and the suburbs.
Diners can choose from a dozen and a half restaurants north of the Miami River that stay open after 7 p.m., compared with two or three a few years ago, said Jose Goyanes, 42, a longtime Downtown business owner who, with his partners, converted a luggage store into Tre Italian Bistro a year ago.
The flood of new residents has softened the impact of the recession, he said. “Instead of falling down a precipice, it’s like a bungee cord pulling Downtown businesses up.”
The area’s fledgling success comes after a lot of financial pain endured by developers, banks and foreclosed homeowners throughout Miami. Developers that didn’t unload their units by the end of 2008 faced the most serious problems, Zalewski of Condo Vultures said.
Buying in Bulk
The bulk sale of condos in the Marina Blue high rise in December 2008 depressed prices, Zalewski said. Hyperion Development sold 60 units in the 516-unit building for about $200 a square foot, about half of the original price, the South Florida Business Journal reported at the time.
The complex, featuring two outdoor pools, a volleyball court and sand-filled “Sky Beach” on the 14th floor, is now sold out, said Carolyn Van Gorder, vice president of sales and marketing for Hyperion Group. Many units are rented.
In early 2009, lenders began allowing developers to cut prices on individual units, rather than sell them to bulk buyers who would flip them one by one for a profit, said Robert Given, executive vice president at broker CB Richard Ellis Group Inc. in Miami.
Corus Loans
Struggling projects include the 56-story Infinity at Brickell, about a quarter of which has sold, and Mint, which is empty. A team of investors led by Barry Sternlicht’s Starwood Capital Group LLC took a stake in the portfolio of failed lender Corus Bankshares Inc. that includes the Mint and Infinity loans. It plans to relaunch the projects in coming months, said Jonathan Pertchik, chief operating officer for ST Residential, the company managing the former Corus assets.
Corus, based in Chicago, had $977 million in condo loans on properties in Miami and southeast Florida as of March 2009.
“I don’t think it had anything to do with the caliber, quality and foresight” of the developers, Zalewski said. “Ultimately, what it came down to was timing. It was a matter of which developers could finish off their project, take it to market, close and take their cash before the market collapsed.”
The Miami-Fort Lauderdale-Pompano Beach metro area had the highest foreclosure rate among large U.S. cities in May, with one of every 134 units receiving a filing, according to RealtyTrac Inc., an Irvine, California-based data seller. The average rate for the U.S. is one in 400 units.
Condo ‘Masterpiece’
“We were trying to build a city in perhaps what was too fast a time period,” said Jorge Perez, chairman and chief executive officer of The Related Group in Miami, which built more than 6,500 units in the greater downtown area.
The closely held firm, which is 20 percent owned by Stephen Ross, founder of New York-based Related Cos., broke ground in 2001 on One Miami, the first major condo project on the north side of the river. Perez said his masterpiece is the $1.25 billion Icon Brickell, completed in late 2008, a 1,800-unit project with a boutique hotel and an Alice-in-Wonderland feel. There is a two-acre sundeck, 140 feet above Biscayne Bay, featuring three pools, an outdoor fireplace and an oversized floor chess board.
The Related Group lost between $50 million and $100 million on Icon, Perez said. The firm handed back two of Icon’s three towers to a syndicate of lenders led by HSBC Holdings Plc in May after winning bank approval late last year to slash prices by about 30 percent. The price cut has spurred sales, which increased to about 640 as of this month from 38 closings at the end of the second quarter of last year.
Seizing Opportunity
“Over the long run, what we did in building those buildings, was it wrong?” Perez said. “I wish there wasn’t the suffering on a personal basis, on a banking basis and individual basis. But have we made Miami a much better city? Absolutely, yes.”
John Guarin, a 34-year-old real estate broker who rents a one-bedroom apartment in one of the Icon towers for $1,800 a month, said he recognized early that the Miami rental market would explode. Guarin’s ApartmentsLLC.net specializes in finding rentals for students from the University of Miami.
Guarin, who earned a Master of Business Administration from the school in late 2008, said the idea for the business began with a paper he wrote for a marketing class about the greater downtown area’s underserved rental market.
“I knew something had to be done with the buildings,” he said. “Nobody was buying them.”
‘Sickest View’
This is Guarin’s busiest time because it’s when students look for apartments. He recently took two 22-year-old graduate students, Jean Chang, a Los Angeles native, and Elizabeth Lombardi from New Jersey, on a tour of properties renting for about $2,200. Chang’s first choice was Everglades on the Bay, which has a four-story fitness and spa center with a jogging track circling the roof and the “sickest view” of the bay, Chang said.
The condo was gone the next day before she could put down a deposit.
Guarin also showed them Axis, where for $2,075 they could share a two-bedroom, two-bath condo of almost 1,200 square feet, with a wraparound balcony on the 36th floor. While they put down $100 to hold the unit, they later chose a place with more evenly sized bedrooms on South Beach, a neighborhood world famous for its nightlife and celebrity sightings.
The broker said it’s a matter of taste: many clients are looking to escape the noise of South Beach, which is about 5 miles (8 kilometers) east of Downtown across Biscayne Bay.
Toning Down Parties
Axis, which attracts students from the University of Miami because of its easy access to public transportation, is implementing new rules to keep partying to appropriate levels. The building has received complaints from residents about crowds by the pool, loud music and women taking their tops off, according to Piazza, the project manager. Starting July 4, no more than four guests are allowed for each apartment, and boom boxes are barred by the pool.
“If you want to have something like that, you have to go to the beach,” he said.
Miami is turning into something that Florida has never had: a densely populated city where professionals live and work, said Alan Ojeda, whose Rilea Group recently finished 1450 Brickell Avenue, one of three new office towers in the city’s urban core. The $270 million building has 35 stories, 585,000 square feet of rentable space and 1,200 parking spaces.
“It’s what’s missing in Florida,” Ojeda said of Downtown. “Look, it’s 9 p.m. on a Thursday. It’s not Saturday night fever and the bars and restaurants are full.”
Source: http://www.bloomberg.com/news/2010-07-13/miami-downtown-comes-alive-as-unsold-condominiums-fill-with-young-renters.html
To contact the reporter on this story: Prashant Gopal in New York at Pgopal2@bloomberg.net
By Prashant Gopal - Jul 13, 2010
The 26-year-old tax accountant walks three blocks from his condominium tower on Biscayne Bay in Miami to his office at Deloitte LLP. On weekends, he and his friends hang out on the pool deck or share a cab to a local Irish pub.
He lives in Downtown, a neighborhood where young people are renting condos built during the 2004 to 2008 boom to attract second-home buyers. Thanks to the housing crash, Klein and two roommates pay about $900 a month each for a wraparound balcony, water views and access to a gym, spa and steam room.
“Five years ago you wouldn’t have kids fresh out of college living in luxury like this,” said Klein, sitting in front of the 24-hour concierge in the three-story lobby of his building at 50 Biscayne Boulevard, coordinating happy-hour plans by text message. His friends are concentrated in nearby Met I, which has 447 luxury units and a steakhouse on the first floor. They refer to the building as “Deloitte Dorm” because it’s home to so many employees of the accounting and consulting firm.
The 7,000 unsold condos in Miami’s core -- a symbol of a building boom that collapsed and dragged the city into recession -- are filling up and giving life to neighborhoods that previously closed after dark. New, year-round residents are cramming into restaurants, nightclubs and bars that didn’t exist a few years ago, and enjoying a lifestyle made possible in part by developers and banks seeking to recoup losses by renting luxury dwellings until the market recovers.
Creating A City
“I’m a big city person, and I always thought Miami didn’t have a real city,” said Dejan Krsmanovic, a 39-year-old biomedical engineer who was on a first date at Segafredo, a busy Italian restaurant and bar that opened in 2008 in the adjacent Brickell neighborhood, where the same trend is playing out.
“Miami Beach is not a city, it’s a resort,” he said. “This is beginning to resemble a city.”
The unsold condos represent almost a third of the 22,079 units in 75 buildings, mostly opened after 2004, tracked in a study released in March by the Miami Downtown Development Authority. The report focused on central neighborhoods including Downtown, Brickell and Wynnwood/Edgewater.
Occupancy rates in the new buildings, including owner- occupants and tenants, increased to 74 percent in February from 62 percent in May 2009, the study shows.
Price Cuts
The development authority estimates that the population of Miami’s urban core jumped to about 70,000 from 40,000 since the 2000 census, said authority spokesman Robert Geitner.
“For us, it doesn’t matter whether they rent or buy,” said Miami Mayor Tomás P. Regalado. “The more people, the more business, the more safety, the more progress.”
The influx of college students, young professionals and empty nesters from the Coral Gables section of the city and the suburbs intensified about 18 months ago when banks that financed the condo projects agreed to let developers slash sales prices by as much as 40 percent, said Peter Zalewski, a principal with consulting firm Condo Vultures LLC in Miami. That spurred demand from foreign buyers and all-cash investors, many of whom are renting out their units until prices rebound, he said.
The Miami metro rental market is one of the strongest in the country, according to Ron Johnsey, president of Axiometrics Inc., an apartment-research firm in Dallas. That’s the case even though unemployment is more than 11 percent, compared with 9.5 percent nationally, and developers are adding to supply by leasing units built for purchase.
Rents Rise
Effective rents, the amounts actually received by landlords, rose 4 percent in the first five months of the year after falling 2.9 percent during the same period in 2009, according to Axiometrics, whose data tracks professionally managed rental building. Nationally, rents increased 2.75 percent from January to May.
The occupancy rate for Miami climbed to 95.1 percent in May from 93.8 percent a year earlier, Johnsey said.
Condos are being purchased by investors and rented out in Phoenix, San Diego and Las Vegas, where thousands of units also went up during the boom, according to Ross Moore, chief economist for Colliers International, a Seattle-based real estate services firm.
“It’s something we’re seeing in many markets,” he said. “Miami is an absolute extreme example.”
Holding Out Hope
While the city is heading in the right direction, it will take years to fully recover, said Michael Fratantoni, vice president of single-family research and policy at the Mortgage Bankers Association in Washington.
“Miami has been one of the areas most deeply impacted by the crisis,” he said. “But the backstop of foreign-buyer demand is going to help Miami do better than the rest of the state.”
Builders haven’t given up on finding buyers for their condos. At the Axis on Brickell, developed by Brack Capital Group, about 85 percent of the 718 units are rented, said Albert Piazza, the project manager. The firm has sold about 239 condos at the complex, which features poolside cabanas, a theater and a billiards room, and is allowing tenants to direct 50 percent of their rent toward purchase. Once credit for mortgages frees up, Piazza expects many of them to act, he said.
“The goal is still to sell out,” Piazza said.
Occupancy Rates
T. Sinclair Jacobs, 87, who founded the Brickell Homeowners Association 20 years ago, watched the developments go up. The group’s original residents lived south of Southeast 15th Road, along Brickell Avenue, in decades-old condo towers, some of which appeared in the “Miami Vice” television series, according to Geitner. Developers then pushed north 13 blocks, putting up about 25 projects along Brickell Avenue, known for its bank buildings.
Development crossed the Miami River to connect with Downtown, adding glass-and-steel residential towers to the area’s mix of courthouses, hotels, warehouses, homeless shelters and stores. The American Airlines Arena, where LeBron James will play next season with the National Basketball Association’s Miami Heat, opened there in 1999.
While Jacobs believes the projects needed better planning, he said they are making Miami a better place to live.
“With the greater concentration of residents, there’ll be a beneficial effect on traffic because we’ll have better public transportation,” he said. “We didn’t have the residents before to support mass transit. In the long run, this is going to be one of the great cities in the world.”
Softening Recession’s Pain
The new vitality can be seen at Juan Chipoco’s sleek Peruvian restaurant, CVI.CHE 105, on Northeast 3rd Avenue off of East Flagler Street, in the heart of the old Downtown shopping area. Chipoco, who finished expanding to 220 seats from 65 seats three months ago, said lines sometimes form on weekends even with a $10 valet fee and limited parking. The restaurant also draws customers from Miami Beach and the suburbs.
Diners can choose from a dozen and a half restaurants north of the Miami River that stay open after 7 p.m., compared with two or three a few years ago, said Jose Goyanes, 42, a longtime Downtown business owner who, with his partners, converted a luggage store into Tre Italian Bistro a year ago.
The flood of new residents has softened the impact of the recession, he said. “Instead of falling down a precipice, it’s like a bungee cord pulling Downtown businesses up.”
The area’s fledgling success comes after a lot of financial pain endured by developers, banks and foreclosed homeowners throughout Miami. Developers that didn’t unload their units by the end of 2008 faced the most serious problems, Zalewski of Condo Vultures said.
Buying in Bulk
The bulk sale of condos in the Marina Blue high rise in December 2008 depressed prices, Zalewski said. Hyperion Development sold 60 units in the 516-unit building for about $200 a square foot, about half of the original price, the South Florida Business Journal reported at the time.
The complex, featuring two outdoor pools, a volleyball court and sand-filled “Sky Beach” on the 14th floor, is now sold out, said Carolyn Van Gorder, vice president of sales and marketing for Hyperion Group. Many units are rented.
In early 2009, lenders began allowing developers to cut prices on individual units, rather than sell them to bulk buyers who would flip them one by one for a profit, said Robert Given, executive vice president at broker CB Richard Ellis Group Inc. in Miami.
Corus Loans
Struggling projects include the 56-story Infinity at Brickell, about a quarter of which has sold, and Mint, which is empty. A team of investors led by Barry Sternlicht’s Starwood Capital Group LLC took a stake in the portfolio of failed lender Corus Bankshares Inc. that includes the Mint and Infinity loans. It plans to relaunch the projects in coming months, said Jonathan Pertchik, chief operating officer for ST Residential, the company managing the former Corus assets.
Corus, based in Chicago, had $977 million in condo loans on properties in Miami and southeast Florida as of March 2009.
“I don’t think it had anything to do with the caliber, quality and foresight” of the developers, Zalewski said. “Ultimately, what it came down to was timing. It was a matter of which developers could finish off their project, take it to market, close and take their cash before the market collapsed.”
The Miami-Fort Lauderdale-Pompano Beach metro area had the highest foreclosure rate among large U.S. cities in May, with one of every 134 units receiving a filing, according to RealtyTrac Inc., an Irvine, California-based data seller. The average rate for the U.S. is one in 400 units.
Condo ‘Masterpiece’
“We were trying to build a city in perhaps what was too fast a time period,” said Jorge Perez, chairman and chief executive officer of The Related Group in Miami, which built more than 6,500 units in the greater downtown area.
The closely held firm, which is 20 percent owned by Stephen Ross, founder of New York-based Related Cos., broke ground in 2001 on One Miami, the first major condo project on the north side of the river. Perez said his masterpiece is the $1.25 billion Icon Brickell, completed in late 2008, a 1,800-unit project with a boutique hotel and an Alice-in-Wonderland feel. There is a two-acre sundeck, 140 feet above Biscayne Bay, featuring three pools, an outdoor fireplace and an oversized floor chess board.
The Related Group lost between $50 million and $100 million on Icon, Perez said. The firm handed back two of Icon’s three towers to a syndicate of lenders led by HSBC Holdings Plc in May after winning bank approval late last year to slash prices by about 30 percent. The price cut has spurred sales, which increased to about 640 as of this month from 38 closings at the end of the second quarter of last year.
Seizing Opportunity
“Over the long run, what we did in building those buildings, was it wrong?” Perez said. “I wish there wasn’t the suffering on a personal basis, on a banking basis and individual basis. But have we made Miami a much better city? Absolutely, yes.”
John Guarin, a 34-year-old real estate broker who rents a one-bedroom apartment in one of the Icon towers for $1,800 a month, said he recognized early that the Miami rental market would explode. Guarin’s ApartmentsLLC.net specializes in finding rentals for students from the University of Miami.
Guarin, who earned a Master of Business Administration from the school in late 2008, said the idea for the business began with a paper he wrote for a marketing class about the greater downtown area’s underserved rental market.
“I knew something had to be done with the buildings,” he said. “Nobody was buying them.”
‘Sickest View’
This is Guarin’s busiest time because it’s when students look for apartments. He recently took two 22-year-old graduate students, Jean Chang, a Los Angeles native, and Elizabeth Lombardi from New Jersey, on a tour of properties renting for about $2,200. Chang’s first choice was Everglades on the Bay, which has a four-story fitness and spa center with a jogging track circling the roof and the “sickest view” of the bay, Chang said.
The condo was gone the next day before she could put down a deposit.
Guarin also showed them Axis, where for $2,075 they could share a two-bedroom, two-bath condo of almost 1,200 square feet, with a wraparound balcony on the 36th floor. While they put down $100 to hold the unit, they later chose a place with more evenly sized bedrooms on South Beach, a neighborhood world famous for its nightlife and celebrity sightings.
The broker said it’s a matter of taste: many clients are looking to escape the noise of South Beach, which is about 5 miles (8 kilometers) east of Downtown across Biscayne Bay.
Toning Down Parties
Axis, which attracts students from the University of Miami because of its easy access to public transportation, is implementing new rules to keep partying to appropriate levels. The building has received complaints from residents about crowds by the pool, loud music and women taking their tops off, according to Piazza, the project manager. Starting July 4, no more than four guests are allowed for each apartment, and boom boxes are barred by the pool.
“If you want to have something like that, you have to go to the beach,” he said.
Miami is turning into something that Florida has never had: a densely populated city where professionals live and work, said Alan Ojeda, whose Rilea Group recently finished 1450 Brickell Avenue, one of three new office towers in the city’s urban core. The $270 million building has 35 stories, 585,000 square feet of rentable space and 1,200 parking spaces.
“It’s what’s missing in Florida,” Ojeda said of Downtown. “Look, it’s 9 p.m. on a Thursday. It’s not Saturday night fever and the bars and restaurants are full.”
Source: http://www.bloomberg.com/news/2010-07-13/miami-downtown-comes-alive-as-unsold-condominiums-fill-with-young-renters.html
To contact the reporter on this story: Prashant Gopal in New York at Pgopal2@bloomberg.net
By Prashant Gopal - Jul 13, 2010
Friday, July 9, 2010
Miami Beach Luxury Real Estate Gets Cheaper as Short Sales Abound
Finding a "cheap" mansion on Miami Beach has become easier in the last few years due to the yo-yo-ing real estate market. That is, if you consider $3 million to be cheap. A few years ago, many of the properties on millionaire-row streets like North Bay Road and Palm Avenue were untouchable by many well-to-do buyers. Now those priced at $12 million and $13 million have dropped to $9 million, while those at $6 million are now priced at $3 million.
Ironically, wealthy all-cash buyers may ultimately rescue the deeply depressed local housing market.
"We definitely see affordable mansions happening all over, but especially in our waterfront properties, where the most desirable mansions are located," says Esther Percal, a Realtor with Esslinger, Wooten, Maxwell who has made a career of selling luxury real estate on Miami Beach.
She's referring specifically to North Bay Road where unobstructed, bay-front homes range near 14,000 square feet, with 80 feet of waterfront.
These lower prices are a 40 percent reduction from what these homes cost when the market was booming. Taking advantage of the affordability are interested buyers who had been hovering around Miami Beach looking for a home, but were unable to purchase. Now is their time. In the centrally located Venetian Islands, which are walking distance to South Beach, homes can be bought for between $1 million and $1.5 million, an affordable price considering that most are 10,500 square feet with 65 feet of waterfront.
Celebrities are not immune to these lower prices, with NBA Star Shaquille O'Neal taking a hit on his two-story Star Island home. He originally purchased the 20,000-square-foot, eight-bed, nine-and-half-bath house for $18.8 million in 2004 and sold it to a Russian buyer in June of 2009 for $16 million. He had originally put the two-acre parcel at 26 Star Island Drive on the market for $32 million, and he got a higher offer at first. But O'Neal ended up with a loss while the European got a sweet deal.
With Miami being a playground for the rich, most of the buyers -- some 60 percent of them -- are part-time residents (mostly Europeans and Northerners) and they're buying with all cash. "These folks have wanted a piece of the beach for a while but a few years ago even non-waterfront property was $1 million and now that's down to $500,000, meaning we are no longer untouchable as we once were," Percal says. Besides, dealing with the banks and any kind of financing is a nightmare, since everything is down in appraisals and banks. The all-cash deals are not subject to financing.
All these facts and figures are indicators of a possible slight turnaround in the market. Sales have been so strong in the past two years that good deals are getting harder to find. "Turning the market around is a matter of absorption and we're seeing that. Where once we had an 18-month inventory it's now down to a 14-month inventory, so there's market absorption," she said.
So it may be that, in the long run, these cash buyers will be partly responsible for rescuing the housing market.
Wouldn't that be something?
Source: http://www.housingwatch.com/2010/07/08/miami-beach-luxury-real-estate-gets-cheaper-as-short-sales-aboun/
By Josie Gulliksen
Ironically, wealthy all-cash buyers may ultimately rescue the deeply depressed local housing market.
"We definitely see affordable mansions happening all over, but especially in our waterfront properties, where the most desirable mansions are located," says Esther Percal, a Realtor with Esslinger, Wooten, Maxwell who has made a career of selling luxury real estate on Miami Beach.
She's referring specifically to North Bay Road where unobstructed, bay-front homes range near 14,000 square feet, with 80 feet of waterfront.
These lower prices are a 40 percent reduction from what these homes cost when the market was booming. Taking advantage of the affordability are interested buyers who had been hovering around Miami Beach looking for a home, but were unable to purchase. Now is their time. In the centrally located Venetian Islands, which are walking distance to South Beach, homes can be bought for between $1 million and $1.5 million, an affordable price considering that most are 10,500 square feet with 65 feet of waterfront.
Celebrities are not immune to these lower prices, with NBA Star Shaquille O'Neal taking a hit on his two-story Star Island home. He originally purchased the 20,000-square-foot, eight-bed, nine-and-half-bath house for $18.8 million in 2004 and sold it to a Russian buyer in June of 2009 for $16 million. He had originally put the two-acre parcel at 26 Star Island Drive on the market for $32 million, and he got a higher offer at first. But O'Neal ended up with a loss while the European got a sweet deal.
With Miami being a playground for the rich, most of the buyers -- some 60 percent of them -- are part-time residents (mostly Europeans and Northerners) and they're buying with all cash. "These folks have wanted a piece of the beach for a while but a few years ago even non-waterfront property was $1 million and now that's down to $500,000, meaning we are no longer untouchable as we once were," Percal says. Besides, dealing with the banks and any kind of financing is a nightmare, since everything is down in appraisals and banks. The all-cash deals are not subject to financing.
All these facts and figures are indicators of a possible slight turnaround in the market. Sales have been so strong in the past two years that good deals are getting harder to find. "Turning the market around is a matter of absorption and we're seeing that. Where once we had an 18-month inventory it's now down to a 14-month inventory, so there's market absorption," she said.
So it may be that, in the long run, these cash buyers will be partly responsible for rescuing the housing market.
Wouldn't that be something?
Source: http://www.housingwatch.com/2010/07/08/miami-beach-luxury-real-estate-gets-cheaper-as-short-sales-aboun/
By Josie Gulliksen
Wednesday, July 7, 2010
South Florida home sales buck national trend
Thanks to the ongoing appetite of international and cash buyers, South Florida's real estate market was shielded from a national drop-off in sales.
Because those buyers were not eligible for a tax credit, their desire for real estate didn't taper off after the benefit expired at the end of April, like it did for others who rushed to get in on the deal.
It's true that in the two months since the tax credit expired, pending sales in Miami-Dade and Broward have fallen 2.6 percent, according to the Realtor Association of Greater Miami and the Beaches.
But that decrease is relatively mild when compared with the swift drop-off in sales that took place nationally after the federal subsidy expired. The first post-tax-credit pending sales numbers, released Thursday, show a 15.9 percent decrease in pending sales in May, figures from the National Association of Realtors show. Year-over-year, pending sales plunged 30 percent.
In June, potential homebuyers in Miami-Dade County signed 10,366 sales contracts -- an increase of 53 percent when compared to the same month last year, but a 1 percent decrease from May, according to figures released Thursday by the Realtor Association of Greater Miami and the Beaches. In Broward, pending sales were up 28.7 percent since June 2009 but down 2.7 percent for the month to 8,031.
Helen Jeanne Nicastri, a Realtor and president of the Miami-based Master Brokers Forum, said interest from Mexican, Brazilian and European buyers has helped her move luxury properties in recent months.
``That's what I'm seeing -- strong international buyers coming into the marketplace,'' said Nicastri, who has a $12.9 million deal pending with an international buyer. ``They're attracted to the U.S. for our prices, as this one of the states in the nation that has been affected most. Our prices are amazing.''
South Florida sales also have managed to hold because of depressed prices, low interest rates and a pool of buyers that includes bulk investors and cash-wielding foreigners, said Jack McCabe, CEO of McCabe Research & Consulting.
``We have a buyers pool that encompasses all four points on the compass, while many other markets rely only on U.S. buyers,'' he said.
The figures were released one day after Congress passed a bill that would give homebuyers an extra three months to close on a home and still qualify for a tax credit of up to $8,000. Many buyers who went to contract on homes before the April 30 deadline were unable to close on the purchase before June 30, the original cutoff date for closing. The measure, which President Barack Obama is expected to sign, would extend that cutoff date to Sept. 30, though no new contracts would qualify.
Locally, condominium sales were stronger than single-family homes sales, with large increases year-over-year and slight decreases for the month. In Miami-Dade, 5,876 contracts were signed, up 76.4 percent since May 2009 -- but down 0.64 percent since April 2010.
In Broward, the 4,429 pending condo sales in June represent an increase of 56 percent for the year, but a decrease of 2.3 percent for the month.
Though the tax credits are gone, low prices helped keep buyers interested. Condo prices remain far below their peak, with May median sales prices standing at $81,500 in Broward and $126,100 in Miami-Dade, where prices dropped another 10 percent from May 2009.
Single-family home prices are up slightly, rising to $196,700 in Miami-Dade, and $216,400 in Broward in May. Those prices are up 1 percent and 18 percent, respectively, since May 2009.
In Miami-Dade, pending sales of single-family homes increased 31 percent in June from the previous year, to 4,490, but dropped 1.15 percent from May.
In Broward, June pending sales of single-family homes rose 20.6 percent year-over-year, but dropped 2.7 percent month-over-month. Broward buyers signed 3,602 contracts in June, down from 3,719 in May.
Though the month-to-month decreases were less than some market-watchers had feared, the local market is certainly not out of the woods.
A large backlog of foreclosure properties making their way through the system, high unemployment and condo prices that continue to slide all threaten to prolong the road to recovery.
For the past four weeks, the number of homes and condos on the market has been increasing, the first monthly rise in nearly two years, according to analysis by real estate consultancy Condo Vultures.
A continued increase in inventory over the next few weeks could signal a ``double dip'' in housing prices, said Peter Zalewski, a principal at the Bal Harbour firm.
And the local labor market, which is crucial for demand, continues to struggle in South Florida, with a local unemployment rate significantly higher than the national average.
Miami-Dade's seasonally adjusted unemployment rate rose to 12.4 percent in May, while Broward's rate dropped slightly to 9.8 percent. Nationally, unemployment has hovered around 9.7 percent for the past few months.
Source: http://www.miamiherald.com/2010/07/01/1711497/home-sales-in-s-fla-buck-trend.html
By TOLUSE OLORUNNIPA
tolorunnipa@MiamiHerald.com
Because those buyers were not eligible for a tax credit, their desire for real estate didn't taper off after the benefit expired at the end of April, like it did for others who rushed to get in on the deal.
It's true that in the two months since the tax credit expired, pending sales in Miami-Dade and Broward have fallen 2.6 percent, according to the Realtor Association of Greater Miami and the Beaches.
But that decrease is relatively mild when compared with the swift drop-off in sales that took place nationally after the federal subsidy expired. The first post-tax-credit pending sales numbers, released Thursday, show a 15.9 percent decrease in pending sales in May, figures from the National Association of Realtors show. Year-over-year, pending sales plunged 30 percent.
In June, potential homebuyers in Miami-Dade County signed 10,366 sales contracts -- an increase of 53 percent when compared to the same month last year, but a 1 percent decrease from May, according to figures released Thursday by the Realtor Association of Greater Miami and the Beaches. In Broward, pending sales were up 28.7 percent since June 2009 but down 2.7 percent for the month to 8,031.
Helen Jeanne Nicastri, a Realtor and president of the Miami-based Master Brokers Forum, said interest from Mexican, Brazilian and European buyers has helped her move luxury properties in recent months.
``That's what I'm seeing -- strong international buyers coming into the marketplace,'' said Nicastri, who has a $12.9 million deal pending with an international buyer. ``They're attracted to the U.S. for our prices, as this one of the states in the nation that has been affected most. Our prices are amazing.''
South Florida sales also have managed to hold because of depressed prices, low interest rates and a pool of buyers that includes bulk investors and cash-wielding foreigners, said Jack McCabe, CEO of McCabe Research & Consulting.
``We have a buyers pool that encompasses all four points on the compass, while many other markets rely only on U.S. buyers,'' he said.
The figures were released one day after Congress passed a bill that would give homebuyers an extra three months to close on a home and still qualify for a tax credit of up to $8,000. Many buyers who went to contract on homes before the April 30 deadline were unable to close on the purchase before June 30, the original cutoff date for closing. The measure, which President Barack Obama is expected to sign, would extend that cutoff date to Sept. 30, though no new contracts would qualify.
Locally, condominium sales were stronger than single-family homes sales, with large increases year-over-year and slight decreases for the month. In Miami-Dade, 5,876 contracts were signed, up 76.4 percent since May 2009 -- but down 0.64 percent since April 2010.
In Broward, the 4,429 pending condo sales in June represent an increase of 56 percent for the year, but a decrease of 2.3 percent for the month.
Though the tax credits are gone, low prices helped keep buyers interested. Condo prices remain far below their peak, with May median sales prices standing at $81,500 in Broward and $126,100 in Miami-Dade, where prices dropped another 10 percent from May 2009.
Single-family home prices are up slightly, rising to $196,700 in Miami-Dade, and $216,400 in Broward in May. Those prices are up 1 percent and 18 percent, respectively, since May 2009.
In Miami-Dade, pending sales of single-family homes increased 31 percent in June from the previous year, to 4,490, but dropped 1.15 percent from May.
In Broward, June pending sales of single-family homes rose 20.6 percent year-over-year, but dropped 2.7 percent month-over-month. Broward buyers signed 3,602 contracts in June, down from 3,719 in May.
Though the month-to-month decreases were less than some market-watchers had feared, the local market is certainly not out of the woods.
A large backlog of foreclosure properties making their way through the system, high unemployment and condo prices that continue to slide all threaten to prolong the road to recovery.
For the past four weeks, the number of homes and condos on the market has been increasing, the first monthly rise in nearly two years, according to analysis by real estate consultancy Condo Vultures.
A continued increase in inventory over the next few weeks could signal a ``double dip'' in housing prices, said Peter Zalewski, a principal at the Bal Harbour firm.
And the local labor market, which is crucial for demand, continues to struggle in South Florida, with a local unemployment rate significantly higher than the national average.
Miami-Dade's seasonally adjusted unemployment rate rose to 12.4 percent in May, while Broward's rate dropped slightly to 9.8 percent. Nationally, unemployment has hovered around 9.7 percent for the past few months.
Source: http://www.miamiherald.com/2010/07/01/1711497/home-sales-in-s-fla-buck-trend.html
By TOLUSE OLORUNNIPA
tolorunnipa@MiamiHerald.com
Tuesday, July 6, 2010
South Florida Foreclosure Filings Drop 49% in Q-2
According to a new report by Condo Vultures, lenders filed 49 percent fewer foreclosure actions against borrowers in the tricounty South Florida region in the second quarter of 2010 compared to a year earlier.
Banks initiated about 14,500 foreclosure actions in Miami-Dade, Broward, and Palm Beach counties between April and June of 2010 compared to about 28,400 foreclosure actions initiated during the same three-month span of 2009, according to the report based on the Condo Vultures.
For the year, South Florida foreclosure filings are down 34 percent to 34,500 in the first six months of 2010 compared to about 52,200 actions in 2009, 37,800 actions in 2008, and 8,000 actions in 2007, according to the report based on Clerk of the Court records in Miami-Dade, Broward, and Palm Beach counties.
"Lenders filed an average of 190 foreclosure actions per calendar day in the first half of 2010," said Peter Zalewski, a principal with the Bal Harbour, Fla.-based Condo Vultures LLC. "As high as the current number seems, the pace is down significantly from recent years when a daily average of 288 actions were filed in 2009 and 209 actions in 2008. Prior to the real estate crash, lenders filed fewer than 50 foreclosure actions per calendar day."
Peter Zalewski
Since 2007, lenders have filed more than 240,000 foreclosures actions in the tricounty South Florida region. Lenders normally file a foreclosure action - also known as a Lis Pendens or notice of default - when borrowers fall 90 days behind on their monthly mortgage payments.
At the current pace, South Florida would experience less than 70,000 foreclosure actions in all of 2010. South Florida's foreclosure filings jumped from 33,000 actions in 2007 to 76,000 in 2008 before reaching 97,000 in 2009, according to the Condo Vultures.
In Miami-Dade County, where Aventura, Key Biscayne, and Miami Beach are located, the number of foreclosure filings is down 48 percent to 8,000 in the first half of 2010. In previous years for the same period, the county experienced 15,300 filings in 2009, 10,300 filings in 2008, and 3,700 filings in 2007.
In Broward County, where Fort Lauderdale, Hollywood, and Pompano Beach are located, foreclosure filings are down 33 percent to about 15,700 actions in the first half of 2010 compared to about 23,300 actions in 2009 and 16,700 actions in 2008. Back in 2007, there were about 2,800 foreclosure filings in Broward in the first six months of that year.
In Palm Beach County, where Boca Raton, Delray Beach, and West Palm Beach are located, the number of foreclosure actions is down 21 percent to 10,800 in the first half of this year. By comparison, foreclosure actions totaled more than 13,500 in 2009, about 10,800 in 2008, and nearly 1,500 in 2007, according to Condo Vultures.
Economics and new government directives are having a slowing effect on South Florida foreclosures.
At the start of the housing crash in 2007, lenders estimated the typical foreclosure would take about six months to repossess a property at a cost of about $40,000 in the loss of debt service, damage, court courts, and attorney's fees. By 2009 as the foreclosure filings were spiking, the process extended out to an average of 18 months with an estimated cost of at least $100,000 per repossession, industry watchers said.
The additional costs and length of time necessary to repossess a property resulted from a variety of reasons, including new legislation and directives requiring lenders to work with borrowers to attempt to modify mortgages in hopes of keeping primary users in their homes. The government directors were prompted by the devastating economic downturn that impacted many borrowers who lost jobs as unemployment rate topped 10 percent and home values dropped dramatically.
Another contributing factor to the decrease in the foreclosure filings is simply the cost involved with repossessing a property compared to completing a short sale, where a borrower unloads a property with a bank's approval at a price below the outstanding loan amount. Lenders have found that once a property is finally repossessed, the bank-owned residence often times sells at the same price as a short sale.
A series of new Florida laws pertaining to condominium units are expected to encourage even more short sales instead of foreclosures.
As of July 2010, lenders are now responsible for paying 12 months - twice as long as previously - of past due condo association fees upon repossessing a property. Under the old legislation, only six months of past due association fees were required to be paid by the lender of a repossessed property.
"The South Florida real estate market is really at a crossroads right now," Zalewski said. "The unknown is whether another wave of foreclosures is coming down the pike given that a number of exotic mortgages are in the process of resetting this year."
Source: http://www.realestatechannel.com/us-markets/residential-real-estate-1/real-estate-news-south-florida-foreclosure-filings-condo-vultures-miami-home-foreclosures-miami-condo-foreclosures-ft-lauderdale-condo-foreclosures-2804.php
Banks initiated about 14,500 foreclosure actions in Miami-Dade, Broward, and Palm Beach counties between April and June of 2010 compared to about 28,400 foreclosure actions initiated during the same three-month span of 2009, according to the report based on the Condo Vultures.
For the year, South Florida foreclosure filings are down 34 percent to 34,500 in the first six months of 2010 compared to about 52,200 actions in 2009, 37,800 actions in 2008, and 8,000 actions in 2007, according to the report based on Clerk of the Court records in Miami-Dade, Broward, and Palm Beach counties.
"Lenders filed an average of 190 foreclosure actions per calendar day in the first half of 2010," said Peter Zalewski, a principal with the Bal Harbour, Fla.-based Condo Vultures LLC. "As high as the current number seems, the pace is down significantly from recent years when a daily average of 288 actions were filed in 2009 and 209 actions in 2008. Prior to the real estate crash, lenders filed fewer than 50 foreclosure actions per calendar day."
Peter Zalewski
Since 2007, lenders have filed more than 240,000 foreclosures actions in the tricounty South Florida region. Lenders normally file a foreclosure action - also known as a Lis Pendens or notice of default - when borrowers fall 90 days behind on their monthly mortgage payments.
At the current pace, South Florida would experience less than 70,000 foreclosure actions in all of 2010. South Florida's foreclosure filings jumped from 33,000 actions in 2007 to 76,000 in 2008 before reaching 97,000 in 2009, according to the Condo Vultures.
In Miami-Dade County, where Aventura, Key Biscayne, and Miami Beach are located, the number of foreclosure filings is down 48 percent to 8,000 in the first half of 2010. In previous years for the same period, the county experienced 15,300 filings in 2009, 10,300 filings in 2008, and 3,700 filings in 2007.
In Broward County, where Fort Lauderdale, Hollywood, and Pompano Beach are located, foreclosure filings are down 33 percent to about 15,700 actions in the first half of 2010 compared to about 23,300 actions in 2009 and 16,700 actions in 2008. Back in 2007, there were about 2,800 foreclosure filings in Broward in the first six months of that year.
In Palm Beach County, where Boca Raton, Delray Beach, and West Palm Beach are located, the number of foreclosure actions is down 21 percent to 10,800 in the first half of this year. By comparison, foreclosure actions totaled more than 13,500 in 2009, about 10,800 in 2008, and nearly 1,500 in 2007, according to Condo Vultures.
Economics and new government directives are having a slowing effect on South Florida foreclosures.
At the start of the housing crash in 2007, lenders estimated the typical foreclosure would take about six months to repossess a property at a cost of about $40,000 in the loss of debt service, damage, court courts, and attorney's fees. By 2009 as the foreclosure filings were spiking, the process extended out to an average of 18 months with an estimated cost of at least $100,000 per repossession, industry watchers said.
The additional costs and length of time necessary to repossess a property resulted from a variety of reasons, including new legislation and directives requiring lenders to work with borrowers to attempt to modify mortgages in hopes of keeping primary users in their homes. The government directors were prompted by the devastating economic downturn that impacted many borrowers who lost jobs as unemployment rate topped 10 percent and home values dropped dramatically.
Another contributing factor to the decrease in the foreclosure filings is simply the cost involved with repossessing a property compared to completing a short sale, where a borrower unloads a property with a bank's approval at a price below the outstanding loan amount. Lenders have found that once a property is finally repossessed, the bank-owned residence often times sells at the same price as a short sale.
A series of new Florida laws pertaining to condominium units are expected to encourage even more short sales instead of foreclosures.
As of July 2010, lenders are now responsible for paying 12 months - twice as long as previously - of past due condo association fees upon repossessing a property. Under the old legislation, only six months of past due association fees were required to be paid by the lender of a repossessed property.
"The South Florida real estate market is really at a crossroads right now," Zalewski said. "The unknown is whether another wave of foreclosures is coming down the pike given that a number of exotic mortgages are in the process of resetting this year."
Source: http://www.realestatechannel.com/us-markets/residential-real-estate-1/real-estate-news-south-florida-foreclosure-filings-condo-vultures-miami-home-foreclosures-miami-condo-foreclosures-ft-lauderdale-condo-foreclosures-2804.php
Friday, July 2, 2010
U.S. home sales jumped in June
BY ALAN ZIBEL
Associated Press
New U.S. home sales jumped in June by the largest amount in more than eight years as buyers took advantage of bargain prices, low interest rates and a federal tax credit for first-time homeowners.
While home prices are still falling, the figures released Monday were another sign the housing market is finally bouncing back. Data out last week showed home resales rose 3.6 percent in June, the third straight monthly increase.
Shares of big home builders soared on the news, with Beazer Homes USA up by more than 13 percent and Hovnanian Enterprises rising 8 percent. But with home prices still falling, these companies won't be making much money anytime soon.
The Commerce Department said new home sales rose 11 percent in June to a seasonally adjusted annual rate of 384,000, from an upwardly revised May rate of 346,000.
However, new home sales for the southern region of the country, which includes Florida, fell 5.3 percent.
Brad Hunter, West Palm Beach-based chief economist and national director of consulting for Metrostudy, a housing research firm, said the government's estimate should be taken with a grain of salt since the margin of error is 13.2 percent.
``The trend we are seeing is that the absorption of new home sales or move-ins is basically still falling,'' Hunter said. ``They are not moving at as fast a rate as they were even a few months ago, which is disturbing.''
Metrostudy's most recent analysis of South Florida showed new home sales fell from 1,204 to 668 between the first and second quarter in a six-county region extending from Miami-Dade to Indian River.
Nonetheless, economists said buyers were rushing to take advantage of a federal tax credit that covers 10 percent of the home price or up to $8,000 for first-time buyers. Home sales need to be completed by the end of November for buyers to take advantage.
``The window of opportunity is closing,'' said Bernard Markstein, senior economist for the National Association of Home Builders.
June's results were the strongest sales pace since November 2008 and exceeded the forecasts of economists surveyed by Thomson Reuters, who expected a pace of 360,000 units. The last time sales rose so dramatically was in December 2000.
Sales have risen for three straight months. The median sales price of $206,200, however, was down 12 percent from $234,300 a year earlier and down nearly 6 percent from $219,000 in May.
``Over the last three or four months there has been a large increase in traffic and you have a larger increase in inquiries as to homes,'' said Fernando Martinez, vice president of sales and marketing with Homestead-based Caribe Homes and president-elect of the Builder Association of South Florida. ``The traffic is ready to buy. They've been looking for a while. They are part of the pent-up demand, Martinez said.
Fallout from the housing crisis has played a central role in the U.S. recession, now the longest since World War II. Foreclosures have spiked, home builders have slashed construction, and financial companies have lost billions.
But it will still be a while before home builders turn into an engine for the economic recovery. Construction levels are still weak because builders still have too many unsold homes sitting vacant.
Miami Herald Business Writer Monica Hatcher contributed to this report.
Source: http://www.miamiherald.com/2009/07/28/1160396/us-new-home-sales-register-a-sharp.html
Associated Press
New U.S. home sales jumped in June by the largest amount in more than eight years as buyers took advantage of bargain prices, low interest rates and a federal tax credit for first-time homeowners.
While home prices are still falling, the figures released Monday were another sign the housing market is finally bouncing back. Data out last week showed home resales rose 3.6 percent in June, the third straight monthly increase.
Shares of big home builders soared on the news, with Beazer Homes USA up by more than 13 percent and Hovnanian Enterprises rising 8 percent. But with home prices still falling, these companies won't be making much money anytime soon.
The Commerce Department said new home sales rose 11 percent in June to a seasonally adjusted annual rate of 384,000, from an upwardly revised May rate of 346,000.
However, new home sales for the southern region of the country, which includes Florida, fell 5.3 percent.
Brad Hunter, West Palm Beach-based chief economist and national director of consulting for Metrostudy, a housing research firm, said the government's estimate should be taken with a grain of salt since the margin of error is 13.2 percent.
``The trend we are seeing is that the absorption of new home sales or move-ins is basically still falling,'' Hunter said. ``They are not moving at as fast a rate as they were even a few months ago, which is disturbing.''
Metrostudy's most recent analysis of South Florida showed new home sales fell from 1,204 to 668 between the first and second quarter in a six-county region extending from Miami-Dade to Indian River.
Nonetheless, economists said buyers were rushing to take advantage of a federal tax credit that covers 10 percent of the home price or up to $8,000 for first-time buyers. Home sales need to be completed by the end of November for buyers to take advantage.
``The window of opportunity is closing,'' said Bernard Markstein, senior economist for the National Association of Home Builders.
June's results were the strongest sales pace since November 2008 and exceeded the forecasts of economists surveyed by Thomson Reuters, who expected a pace of 360,000 units. The last time sales rose so dramatically was in December 2000.
Sales have risen for three straight months. The median sales price of $206,200, however, was down 12 percent from $234,300 a year earlier and down nearly 6 percent from $219,000 in May.
``Over the last three or four months there has been a large increase in traffic and you have a larger increase in inquiries as to homes,'' said Fernando Martinez, vice president of sales and marketing with Homestead-based Caribe Homes and president-elect of the Builder Association of South Florida. ``The traffic is ready to buy. They've been looking for a while. They are part of the pent-up demand, Martinez said.
Fallout from the housing crisis has played a central role in the U.S. recession, now the longest since World War II. Foreclosures have spiked, home builders have slashed construction, and financial companies have lost billions.
But it will still be a while before home builders turn into an engine for the economic recovery. Construction levels are still weak because builders still have too many unsold homes sitting vacant.
Miami Herald Business Writer Monica Hatcher contributed to this report.
Source: http://www.miamiherald.com/2009/07/28/1160396/us-new-home-sales-register-a-sharp.html
Thursday, July 1, 2010
Miami home values rise in South Florida
With the exception of Fort Lauderdale's home market, values for South Florida and Miami home values rose for May compared to last year. Home values in Ft. Lauderdale dropped by 6 percent.
According to data from trade association Florida Realtors, last month Florida realtors sold 972 Miami condos which were 70 percent more than in May 2009. This is a major jump over the 571 units sold in the same month last year. However, the median sales price fell 10 percent to $126,100. Median sales price for Miami condos was the third highest sales price in Florida, following state leader Sarasota-Bradenton and Fort Myers-Cape Coral.
Sales of Miami homes also rose in South Florida. There was 22 percent more Miami homes sold and 20 percent more in the West Palm Beach-Boca Raton metro area. However, the Fort Lauderdale metro area had a six percent decline over last year.
In South Florida, realtors sold a total of 2,345 single-family homes, along with 2,814 condo units last month. The median existing-home sales prices actually rose by $300 over April of this year.
Panama City and Pensacola both saw decreases from April in number of units sold and median sales prices. These are the two most vulnerable metro areas to the oil spill but it’s not clear if that had an effect on sales.
In April the median sales price for Panama City homes was $160,000, according to reports from Florida Realtors. That number dropped however in May to $138,000 and both numbers were much less than in the same periods in 2009.
In April there were 65 condos sold in Panama City in April and just 53 sold in May. Pensacola's condo sales dropped from 56 to 42.
Contributed by MLR Realty
Source: http://www.miamilodgerealty.com/miami-home-values-rise-in-south-florida.html
According to data from trade association Florida Realtors, last month Florida realtors sold 972 Miami condos which were 70 percent more than in May 2009. This is a major jump over the 571 units sold in the same month last year. However, the median sales price fell 10 percent to $126,100. Median sales price for Miami condos was the third highest sales price in Florida, following state leader Sarasota-Bradenton and Fort Myers-Cape Coral.
Sales of Miami homes also rose in South Florida. There was 22 percent more Miami homes sold and 20 percent more in the West Palm Beach-Boca Raton metro area. However, the Fort Lauderdale metro area had a six percent decline over last year.
In South Florida, realtors sold a total of 2,345 single-family homes, along with 2,814 condo units last month. The median existing-home sales prices actually rose by $300 over April of this year.
Panama City and Pensacola both saw decreases from April in number of units sold and median sales prices. These are the two most vulnerable metro areas to the oil spill but it’s not clear if that had an effect on sales.
In April the median sales price for Panama City homes was $160,000, according to reports from Florida Realtors. That number dropped however in May to $138,000 and both numbers were much less than in the same periods in 2009.
In April there were 65 condos sold in Panama City in April and just 53 sold in May. Pensacola's condo sales dropped from 56 to 42.
Contributed by MLR Realty
Source: http://www.miamilodgerealty.com/miami-home-values-rise-in-south-florida.html
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