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July 17, 2014
Apartments' Balancing Act
In most South Florida markets, demand for apartments is about even with supply, Stiles Residential Group prez Jay Jacobson tells us. (They are the yin and yang of business.) Just the time to break ground on a new project in Fort Lauderdale.
Jay says that the apartment industry has recently caught up with new project deliveries, and there might be some short-term softness in some submarkets. “But in the medium term, all signs point to an ever-growing demand for new apartments, especially in the urbanized areas of most municipalities.” (This equilibrium won't last... supply and demand can never stop fighting and breaking up.)
That's because the demand drivers are demographic. Homeownership rates have fallen to historic lows, and projections say it'll stay that way over the next decade or so. Also, more Millennials and aging Baby Boomers signify greater strength for the rental market, Jay says. Recently, Stiles broke ground on 215 SE 8th Ave, a 254-unit luxe rental property a block from Las Olas Boulevard. Units will range from 750 SF to 2,450 SF, and the top six floors will be premium units, with higher-end finishes and views of the city to the west and the coast to the east. Construction will be completed late next year.
Sunny Isles' Starchitect Touch
Top-tier multifamily properties aren't just for Downtown and Miami Beach, Dezer Development prez Gil Dezer tells us. (Why should they have all the fun?) Recently Dezer and partners Related Group and Armani/Casa Interior Design Studio unveiled plans for the 260-unit Residences by Armani/Casa in Sunny Isles. The 60-story tower at 18975 Collins Ave, just north of Bal Harbour, was designed by Cesar Pelli, andis scheduled to open in 2016.
Why Sunny Isles? “At this point in the cycle of Sunny Isles development, our clientele's tastes have become more sophisticated," Gil says. "So we felt that complementing the tower with the world's top designer would help us in achieving the level of success we're looking for.” This will be Armani's first multifamily design in South Florida—first in the United States, in fact—with others in Istanbul, Manila, and Munbai. The goal will be to imprint the property will Giorgio Armani's aesthetic sensibility, according to the developer.
The Property Management Challenge
A red-hot apartment market means more opportunities for property managers, Rivergate Cos prez Jay Massirman tell us, but more headaches as well. Skilled property managers can be hard to find. “The challenge now, first and foremost, is to find and hire the best people,” he says. (Above are KW Management's Robert White and Paul Kaplan.) Today, property managers must be able to control costs (taxes and insurance have a way of creeping up) and tackle resident retention. Jay, along with Robert and Paul, recently formed a new multifamily management firm, Rivergate | KW Management, by combining Rivergate Management with the non-condo portfolio of KW Property Management & Consulting.
A Per-Square-Inch Record
The 1.25 acres that German and Gloria Coto just bought on the Miami River for $125M breaks down to about $2,295/SF or nearly $16/square inch. (Put us down for a few square inches, as South Florida souvenirs.) The Cotos are Argentine grocery store billionaires and an outstanding example of overseas investor interest in Florida real estate. And just the tip of a large iceberg: According to CBRE, the land's listing broker, potential buyers from Miami, other parts of South America, Asia, the Middle East, and Europe were all interested in the deal. No firm plans for the property yet, though it has the potential for about 2M SF of commercial space (all of it presumably platinum-plated).
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