There’s Never Been a Better Time to Throw a Party
December 14, 2007 by Lucas Lechuga
Nowadays, it seems like hardly any developers want to throw a party and I personally think that this is the best time to throw a party. Three years ago, parties were thrown because it was expected (even though people would have signed contracts regardless if there was a party or not). These people signed contracts based on developer reputation, architectural renderings, and merely because the market was hot! It's no secret that the market has cooled considerably since that time.
Why not stand behind your development and launch a party to show the public that you're delivering a great product? Get potential buyers inside the building and let them reminisce about the party and how great your building is to other potential buyers. In my eyes, it sends a strong message to the consumer that you feel that you are delivering a great development to the public and that you are confident that they will feel the same way.
Even the best condo developments will have at least a 15% default rate in this market. Once this becomes a reality, why not hold a weekly open house to showcase your building and available units to the general public? I'll even personally do it for you if you don't have anyone on staff to do it.
The Related Group of Florida is the only developer that I know of that is throwing grand-opening parties for their developments. As I said before, this shows me that they stand behind their product. In fact, their latest development, Apogee South Beach, is having a grand-opening party on December 19. Unfortunately, I won't be in town to catch the party, but the fact that they are having one shows me that they are confident that they will be delivering a spectacular product.
Lucas,
Congratulations on your planned move.
What do you hear about progress at Paramount Bay? Their plans seem quite ambitious. Any word on their presales?
I agree! Parties are festive and it gets people to come out. Although they may be curious it just might be the catalyst to spur action and get them interested in seeing or learning more about the development! Great call Lucas you are certainly one step ahead. After all many people want to buy but don’t like to buy based on floor plans or renderings they saw years ago and want to see the finished product so why wouldn’t you want to throw the party to show of all those great things yo were showing off 3 yrs ago. A… Read more »
The party sounds right up my alley.
Good call Lucas, throwing a party to show off success is a great idea.
That is what I need. I am a buyer in one of these condo towers waiting a close date. (for a second home -> not a flipper). And I am about 50/50 on the decision to default right now, because it sounds like the value will drop more that the deposit I have down. If the developer threw a party instead of going dark with info I would feel much better.
Lucas, I think you are wrong!!!!!!!!. Because we have for many years a BIG and LONG greedy party ,is that nobody has the mony to pay for this BIG mess. Before of even think to have another party ,we should start thinking of how and when we are going to pay for all this mismanagement of assets called GREED.
Lucas, What’s your love affair with all things Related? Maybe they have different relationships with investors or realtors, but from what I’ve heard, from a wide range of end-users, they’re not happy, at all. Anywhere from shoddy finishes to common areas that disappeared. They’ve consistantly over-promised and under-delivered. But yet, every chance you get it’s nothing but high praises. Why? BTW, I’m not being facetious, but more interested in your perspective as well as anyone’s that cares to chime in. For the record, I really enjoy the blog. You’ve created a unique and dynamic forum. Great back-and-forth regardless of differing… Read more »
i travel to miami on business often. Can you let us know when some are scheduled in advance (2 weeks would be great) i would like to see some of them
Bill – I haven’t heard much new about Paramount Bay. Construction is still under way.
Omar – The Related Group always delivers their developments with the common areas completely finished and ready for use. The same can’t be said for a lot of other developers. Which development are you referring to when you say that the common areas disappeared?
I agree with the whole party thing. About 3 weeks ago i went to the one at 50 biscayne and it was great. it showed off the buildings features and provided a great atmosphere of food, music, and drinks.
I’m sure the cost of throwing a party is a big factor in not doing them anymore. I realize it’s a promotional expense, but it may not be the most cost-effective in terms of generating interest. Developers probably weren’t too concerned about that back when things were great and the sky was the limit. However, now developers have to run a much tighter ship if they want to survive, much less profit, in this environment. I’m no marketing expert, but it seems that some of those parties they threw were very expensive and when analyzed on a cost-per-person basis, weren’t… Read more »
AS IF (to borrow from the 90s) I would make an investment decision based on a party. Lucas, I think you are enjoying your temporary timeout too much. It will still come back to the numbers, none of which make sense. Prices will fall. The developer who slashes his prices gets my attention; I don’t make investment decisions after a few free glasses of champagne. And if I want a talking parrot, I will contact a seller’s broker. Lucas – much admiration for your blog, but I have to agree with Omar on one point. If you can point me… Read more »
P.S. No offense to real talking parrots.
I’m obviously not implying that someone would make a purchase decision based on a party or having a little too much to drink. I’m saying that holding a party and weekly open houses is the best way to get as many people to take a look at the finished development. Word of mouth advertising goes a long way. I guess what you’re saying is that we should stick to current game plan – which is for them to cross their fingers and hope for the best.
@MiamiBlue: There isn’t a cocktail party in the world that will tell you what your condo is worth, or what information the developer is withholding. Do you really believe you will get straight talk from a guy who is desperate for you to close over a martini? Ask for the financials.
@Raffi: So did you buy or just have a good time?
Lucas, I’m not sure your last comment was directed at me or another poster. In any case, the last thing the developers should do is stick to the game plan and hope for the best. They should cut their prices. Substantially. It is that simple. Paul Krugman has an interesting article in the NYT today explaining why this crisis is different from other economic crises of the last decade. In those, there was a crisis of confidence: to use his example, a rumor went around that the local bank had made a bad loan. All the investors piled on wanting… Read more »
I think Apogee has a different kind of budget when it comes to marketing! When units start at $3.5M, they have to really wine and dine potential clients to buy. Those types of buyers expect that kind of stuff.
This thread has a lot of activity. Obviously people still care about these developments. So I’ve done some searching and phone calls since my post earlier today. Now I’m thinking my preconstruct deal is still good. With all the panic out there, I still can’t find anything with any altitude and a view for under $395/sqft. Not in a property I would be confortable with. A little post sales marketing on the part of these developers would probably keep their out-of-town customers excited enough to close. If a party is too much money, even a brochure or a recent photo… Read more »
MiamiBlue,
just curious…did you buy in Marina Blue..please email me at [email protected]..I have a unit there and would like to chat..thanks
I’m with Lucas on this one. Good brokerage is all about staying in touch and a party is a good way to do it. Related Group are pros at this. I believe that at the heart of it, buyers want to feel important and want to be appreciated by their developers. And personal attention doesn’t have to cost a lot to be meaningful.
Ah the memories.. You didn’t need spend any money to eat or drink for weeks because there was a party every night of the week. It was great.. I remember some of them really went all out.. Those were the days..
Having a party now would be like being on the Titanic with everyone jumping overboard and you are asking if the buffet is still open. In other words, I think they already had the party and we are experiencing the hangover. If buyers want to see a unit/building, there are more than enough realtors with listings everywhere in every building to go and take a look and kick the tires. Sellers are dealing with the fact of losing their deposits or closing and selling at a loss. I don’t think they would be in the mood for a party to… Read more »
Lucas – I do think though that what happens at flagship buildings such as the Apogee is an important indicator. If there really are enough buyers to come in and take over those units at 3.5 mil and higher – at least it will say something positive about miami beach as a high end destination – and people like that will spend a lot of money in support of the local economy.
I would be interested in what you or others hear about the success of Apogee, Continuum II and/or Jade Ocean in sunny isles.
Matt, so how much better will you feel if your developer finds a foreign buyer of multiple units –at a large discount to what you contracted to pay? Not much better, I’m guessing. The mythical foreign buyer who will save us all has to be a fool, and you rarely make money looking for a bigger fool. When you browse the Forbes 400 or other lists of the rich, the folks who made their money via real estate were developers, not the buyers of their condos. I’m not here to be a smart ass – I’m losing money here, too.… Read more »
“Having a party now would be like being on the Titanic with everyone jumping overboard and you are asking if the buffet is still open.” hahahaah that is the funniest post I’ve read in a while. No one is looking at throwing a party when a development finished 3 years ago was too show off how strong the market was and get more buyers to buy precontruction in that develpers next project and get people talking about that developer and how great it was. What would be the point to throw a party now if there are no new developments… Read more »
Theyre not building new houses in Kendall. Where are all the recent transplants, graduates, and newlyweds going to live?
Ippu probably in Midtown, with all the supply the rents should go down a bit. its simple supply and demand
Looking to buy a new unit in Sunny Isles. La Perla seems the most affordable option. Does anybody have any input? Thanks.
Wow, is it that bad? I might be buying mine for more than its worth, bummer, but that’s the contract. I don’t think its a total loss. I’m still stoked! But everyone can’t be flipper. I plan to finish it, furnish it and have a cool second home. No liquidation sale, no renters. Hell, I’ll probably make security badges for guest to come over (I did that with my truck one time because everyone wanted to borrowed it to move stuff). Seriously, I wonder why there are so many flippers. My hand shook a little when I signed the contract… Read more »
i am buying in brickell. i am young, successful and like challenges. what about people like me. i do not care about retired people or families. there are enough yound people who want to be in the city. remember miami is miami. it has a magic name. like stock market has its own ups and downs but will come up baby. to all negative people here: i never met any successful people with such negative attitude. you must be either desparate or mad where are you in life. miami has a future. it does not look rosy short term but… Read more »
this is for George. I have an apartment in La Perla. It’s an extremely elegant building. Tastefully done not flashy. Great location. I am not planning to sell it with a discount but for the market price I would consider. Since it was the first pre construction development in 2001 it is prices much below of what is available in the new oceanfront buildings.
Hi Laura:
If you can be more specific on which floor the unit is, the sq. ft. and the price that you can consider a sale I will get back to you.
Thanks.
hi George, I have 2bd/2 bth 1430sq.ft+2 terraces, 24th floor, marble floors througout this apartment, best layout,corner unit. $650,000. Brand new building. Closings started in Fall of 2006
Must be the 07 unit, facing west, right?
I can see a similar unit @ 499 K.
I agree about the parties and I feel it does show the developer stands by their product. I also feel some of these developers are not throwing parties because they are making people close on their units even though the buildings are not completed. They are cutting corners and this will hurt them in this market. From the sales cycle to closing on my unit at 50 Biscayne (about a week ago), I have to say that the Related Group has handled everything in a very professional manner. They threw a ground breaking party at Bayfront Park and a grand… Read more »
hi George,
Yes, its 07 line but it has unobstructed views of the ocean, intracoastal all the way to downtown. If you found the price of $499,000 then take it because the unit is spectacular
hi, I would like to get everybody’s opinion on Quantum on the Bay. Have you seen finishes in the building? Which layouts did you like the best in both towers?
This is in response to Joe Dia
Amen, we’re on the same page. The number of pessimists that give their opinions of the market is a dime-a-dozen. Coincidentally, most of these people will be the bystanders on the upturn and will never put their money where their mouth is. That is why people with long-term views of the area should take those opinions with a grain of salt.
JM: I just had a good time, I didn’t buy anything. but i got to see what the building was all about, the units, sizes, amenities, etc. That way when i see a unit for sale i can picture it in my mind. As far as all this complaining and back and forth goes between people; if you are investing long term than it doesn’t really matter what you pay because in the long term you always win, especially since property keeps up with inflation, but; most of us here i believe are short term investors and in that case… Read more »