Brickell Condo Index – February 2009

February 20, 2009 by Lucas Lechuga

Brickell skyline

A lot has changed since I last published the Brickell Condo Index three months ago.  Condo foreclosures have continued to hit the market, financing has become extremely difficult to obtain and a few bulk condo deals have closed in that time.  As a result, it should come as to no surprise that overall condo prices have continued to drop throughout Brickell within the past 3 months.  The data used to compile the statistics below was collected on February 18, 2008 from the MLS.  You may want to compare the following figures to those published three months ago in November 2008.  Also, be sure to view the charts towards the bottom of this post to see how much Brickell condo prices have changed within the past 15 months.

The average asking prices of the 18 condo developments that comprise the Brickell Condo Index is currently $401.30 per square foot.  This represents a 6.57 percent drop in average list prices over the past three months.

Average price per square foot of Brickell condos currently listed on the MLS:

Brickell Miami condo skyline

The average price of Brickell condos sold over the past six months has gone up 1.51 percent to $296.00 per square foot from November’s average of $291.59.  However, this is due to the fact that Four Seasons Residences had been excluded from the average in November due to no closings occurring within the previous six months.  Four Seasons Residences has been reincluded in this month’s index as a result of a condo closing in December 2008.  The average for Brickell condos sold over the past six months would have dropped 3.58 percent had it not been re-included.  With the exception of Bristol Tower, average sales prices for each of the other Brickell condo developments dropped since the November update.

Average price per square foot of Brickell condos sold in the MLS within the past six months:

  • Atlantis – 2025 Brickell Ave | 33129 | $228.95
  • Brickell on the River – 31 SE 5 St | 33131 | $234.18
  • Bristol Tower – 2127 Brickell Ave | 33129 | $385.20
  • Emerald at Brickell – 218 SE 14 St | 33131 | $209.63
  • Four Seasons Residences – 1425 Brickell Ave | 33131 | $518.62
  • Imperial at Brickell – 1627 Brickell Ave | 33129 | $263.68
  • Jade – 1331 Brickell Bay Dr | 33131 | $362.33
  • Latitude on the River – 185 SW 7 St | 33130 | N/A
  • Neo Vertika – 690 SW 1 Ct | 33130 | $221.73
  • One Miami – 325 & 335 S Biscayne Blvd | 33131 | $254.09
  • Santa Maria – 1643 Brickell Ave | 33129 | $756.82
  • Skyline on Brickell – 2101 Brickell Ave | 33129 | $278.43
  • Solaris at Brickell – 186 SE 12 Ter | 33131 | $201.59
  • The Club at Brickell Bay – 1200 Brickell Bay Dr | 33131 | $188.28
  • The Mark on Brickell – 1155 Brickell Bay Dr | 33131 | $228.61
  • The Palace – 1541 Brickell Ave | 33129 | N/A
  • Villa Regina – 1581 Brickell Ave | 33129 | $256.71
  • Vue at Brickell – 1250 S Miami Ave | 33131 | $147.18

Below you will find some additional statistics.  Click on the image to enlarge it.

Brickell Condo Index February 2009 stats

The first column to the right of each condo development’s name is the difference in the average sales price and list price for this month, expressed as a percentage. An “N/A” is found next to Latitude on the River and The Palace since this percentage could not be computed as each building failed to have a closed sale within the past six months through the MLS.  A high percentage indicates that there is a large discrepancy between the average asking price for condos currently on the market and what has actually sold within the past six months.

The second column is the number of active listings in each condo development currently in the MLS. The third column shows the percentage that these listings represent over the total number of condo units in each development. The cells highlighted in green reveal those condo developments that have active listings that represent less than 10 percent of the the overall units in the building. This is typically one indication of a sound condo building. Bristol Tower, Four Seasons Residences, Imperial at Brickell, Latitude on the River, The Palace and Villa Regina are the condo buildings highlighted in green.  However, I think it’s too soon to use this rule of thumb for Latitude on the River.  It’s too new of a development.  Short-sales and foreclosures have just started to hit the market there.  The ones highlighted in red reveal those condo developments that have active listings that represent over 20 percent of the overall units. There’s definitely underlying risk in buying in these condo developments and I’d only advise buying in one of these if the price justifies the risk. As in the November update, Solaris at Brickell is the only condo developments highlighted in red.  This is usually a good indication that prices will fall further in future months.

The fourth column shows the number of condos currently pending sale.  There are currently a total of 81 pending sales in the 18 condo buildings represented in the Brickell Condo Index. I did not include pending sales that went pending before November 1, 2008.  The fifth column displays the number of closed condo sales within the past six months.  The 18 Brickell condo developments have had a total of 198 condos close within that time frame. The vast majority of these closings occurred in just a handful of the condo developments. Latitude on the River and The Palace were the only two condo buildings that haven’t had a condo close within the past six months.

The sixth column shows the difference in the average list prices from this month’s and November’s, expressed as a percentage. Those highlighted in red reveal those condo developments which had a drop in their average list price while those highlighted in green show those that showed an increase. Bristol Tower was the only condo development that had an increase in asking prices since November. In just three month’s time, average asking prices fell about 15 percent at Imperial at Brickell and Solaris at Brickell, 14 percent at Vue at Brickell and 10 percent at Brickell on the River.

The seventh column reveals the difference in average sales prices from this month’s and November’s, expressed as a percentage. The Mark on Brickell saw the largest drop with a 20.95 percent decline. Brickell on the River, Emerald at Brickell, Imperial at Brickell and One Miami also had double digits drops.  Average sales prices at Santa Maria increased about 14 percent but it should be noted that only one closed sale occurred within the past six months.

Brickell Condo Skyline in Miami

I thought it would be interesting to see how prices compare now to those we saw a year ago.  Unfortunately, I didn’t publish a Brickell Condo Index 12 months ago.  However, I used data from the November 2007 Brickell Condo Index to create the charts below to compare current prices to those we saw 15 months ago.  Click on the images below to enlarge them.

(Below) Percentage Change in Average $/SqFt of List Prices Within 15 Months:

Percent change in list prices of Brickell Condos

(Below) Percentage Change in Average $/SqFt of Sales Prices Within the Last 15 Months:

Keep in mind that condo prices in Miami peaked around the beginning of 2006.  The graphs above would be all the more shocking if we were to cross compare current prices to those we saw at that time.  By November 2007, Miami condo prices had already fallen significantly.

One positive thing to note is that the number of condos on the market in the condo buildings comprised in the Brickell Condo Index is down about 26 percent since November 2007.  (This excludes Latitude on the River which had not been included in the Brickell Condo Index at that time.)  Emerald at Brickell and Santa Maria are the only condo developments in the Brickell Condo Index that now have more condos listed than in November 2007.  To put this into perspective, the number of listed condos at Vue at Brickell 15 months ago represented a little over 24 percent of the total condos in the building. Current inventory at Vue at Brickell represents slightly more than 13 percent.

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70 Comments on "Brickell Condo Index – February 2009"


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Anonymous
jcrimes
7 years 7 months ago
lucas since you were a finance guy…the data might be easier to read and digest if you put it in a bid ask format that you see for stocks. bid ask jade 300 500 it’s not exactly the same concept, i.e., you’re listing sales prices of transactions that have cleared not what someone would be willing to pay going forward but i think most recent sales for an illiquid market such as real estate are a good starting point for what the next purchaser may be willing to pay.
Anonymous
Richard
7 years 7 months ago

Jade seems to have a huge number of sales (30) for an established building. Wonder how many were foreclosures.

Anonymous
BMW M3
7 years 7 months ago

richard, most of them. It doesn’t matter what the closing rate is. As soon as a few sales at drastically reduced prices occur, all the speculators holding properties in the building see they’re underwater and default. Federal Reserve Bank studies have shown this to be the #1 factor leading to foreclosure.

Anonymous
Hugo P
7 years 7 months ago

Excellent info Lucas, 3.5% drop in six months is good for the market, but wait until the newer buildings start pressuring the prices more.

The percentage change graph is the most important piece of info here.

I am impressed by Santa Maria, but I’ve always believe that building is in a league of its own.

Anonymous
BMW M3
7 years 7 months ago

Lucas you are promoting misinformation: how does amalgamating all the sales into a single number give you ANY info? Maybe falling prices caused people to buy more expensive homes than they would have bought. You can only compare within the same building. Prices have fallen way more than 3.5%!!!

Anonymous
moretroops
7 years 7 months ago

I feel like it’s time get my feet wet. At this rate I could be priced out of the market for years. I’m not going to see deals like this for awhile. With all the foreign investors here, the market in Miami is different. That’s because all real estate is local. And they’re not making any more land. Why throw my money away renting? It’s time to get in the game. You can’t win if you don’t play. I can do this!

Anonymous
2pence
7 years 7 months ago
“they don’t make more land” Real estate prices in Tokyo declined for 20 years. 20 years. Let it sink in. 20 years. “renting is throwing money away” If it costs you (say) $2,000 a month to rent vs $4,000 a month to own the same property, who do you think is throwing money away. “priced out forever” Dude, have you seen the number of empty apartments in buildings? Forget the coming wave of foreclosures. Today’s existing supply is so great you can sit back and let the prices come to you. “foreign investors” They’ve lost money like everyone else. They… Read more »
Anonymous
moretroops
7 years 7 months ago

2pence, we need a font for sarcasm.

Anonymous
7 years 7 months ago

Hugo P,

The 6-month average actually dropped 3.5% change over the past 3 months (since the November 2008 update), not six months. Reading it again it does sound a bit confusing. The important numbers are the percentage declines amongst the individual condo buildings.

BMW M3,

Did you even read the entire post? I did show how prices have changed within the same building within the past 3 months. For example, I showed that average sales prices at The Mark on Brickell went down about 21% since then.

Anonymous
H2O
7 years 7 months ago

All valid points, however Mr. M.A. Lott says that there appears to be some backing in this young (baby) market.

http://www.youtube.com/watch?v=ru_fcdcmY6g&feature=related

Anonymous
jcrimes
7 years 7 months ago

i hate rumor mongering but i keep on hearing it (and the review’s article today raises the issue as well )…related has some major storm clouds coming its way.

Anonymous
BMW M3
7 years 7 months ago
Anonymous
Un-Related
7 years 7 months ago
jcrimes said: “related has some major storm clouds coming its way” Thanks for opening the door so I won’t be accused of bashing the sacred cow again: http://www.globest.com/news/1351_1351/florida/177025-1.html February 20, 2009 Daily Business Review Last updated: February 20, 2009 11:03am Related Seeks Hotel Investor By Paola Iuspa-Abbott The Related Group, whose new Icon Brickell is saddled with a hefty debt load, is looking for an investor or buyer for the project’s hotel component. Jorge Perez, chairman of the Related Group, recently recruited Holliday Fenoglio Fowler in Coral Gables to find a buyer or an investor for the Viceroy Hotel, Resorts… Read more »
Anonymous
7 years 7 months ago
moretroops…I strongly agree with 2pence….prices will fall a lot further this year and next. Numbers for renting vs owning aside…ask yourself this if you are considering buying right now…”What is my potential reward and what is my potential regret ?” if you buy today you may feel rewarded for jumping in and getting a “good” deal…but if the unit you buy today is worth $50K less (or more) in 1 year…what will be your regret ? If your potential regret (only you know this) exceeds the feeling of reward today, then I would not do it. I always look at… Read more »
Anonymous
The Ace
7 years 7 months ago

Even the Dumb Money can no longer argue the facts for numbers don’t lie.

The Smart Money.

Anonymous
RCR
7 years 7 months ago

Recovery 5 years, 2 years, 10 years. What recovery could you possibly be talking about.

Anonymous
RCR
7 years 7 months ago
Let’s see. Let me put on my thinking cap. How long do I think it will take for Miami, Brickell and area condominium prices to recover to an insane price based on sheer fraud, no income requirements, no concept of someone actually ever using the condo, no or little down payment, no relationship whatsoever to home value, utility, rental or investment value no relationship to anything other than an investment pyramid. I think things look pretty bad and it may take longer than 3rd quarter 2009, but by 1st quarter 2010 we should all be back in business. Where is… Read more »
Anonymous
Muir
7 years 7 months ago

RCR
Well done.

Anonymous
7 years 7 months ago

RCR…I agree with you…there will be no recovery back to these prices.

Anonymous
Raffi
7 years 7 months ago

Lucas,

2 questions; why isnt avenue on brickell and the plaza included? and why is one miami there? One miami is in downtown Miami.

Anonymous
lara
7 years 7 months ago

I completely disagree with the statement that prices will never come back. They will come back. It will take some time though unless it is going to be chaos of world proportions. If that happens then who cares about prices.

Anonymous
7 years 7 months ago
Raffi, Avenue at Brickell and Plaza on Brickell are too new. I’ll likely wait until I see more resales in each before I include them. Plaza will probably be added before Avenue though. Maybe in my next Brickell Condo Index update. I realize that One Miami is located Downtown. However, I grouped it with Brickell because there aren’t enough established buildings in Downtown to warrant a separate index for that neighborhood. In a year or so I’ll likely start to provide statistics for the Downtown buildings as well. The new Stats &Trends enhancement that my website developer is still working… Read more »
Anonymous
samson
7 years 7 months ago

Awesome work, Lucas. Must have taken a lot of time to get that together. I wonder how many appraisers will steal your compilations. Who else tracks this market this closely – and currently? Can’t you trademark or copyright or somehow legally protect your “Index” in order to prevent its commercial use for free?

Anonymous
Renter Tom
7 years 7 months ago

lara, in real dollar terms prices are not coming back at least in the next 20 years. By then, according to the inventor of the Internet, this area will be underwater anyway giving a new meaning to ocean front properties. Ahhhhh Venice.

Anonymous
gables
7 years 7 months ago
some thoughts on when and why a price rebound should/not occur. cities like new york, boston, san francisco, and DC have very high cost of living, even higher than miami. these cities have had high cost of living for quite some time-longer than the elevated prices which existed in miami over the past few years. but miami is different than those cities. they all have had a strong existing demand for high income workers (financials, government, medical, business executives, etc). miami did not have this demand-the boom was driven by investors and rich out of towners looking for a nice… Read more »
Anonymous
jcrimes
7 years 7 months ago
Gables add to that the fact that those out of town wealthy folks now have a slew of locations/cities to invest in an additional home that are nicer or perhaps more convenient for them than miami. Un-related the unsubstantiated rumors i’m hearing go beyond the hotel. i’ll leave it at that. but…looking at the hotel, if fenoglio sells that…they should get a massive bonus (i’ve worked with some folks there before – good choice to market this). this is a case study in business plan idiocy…you have a jw, conrad, sheraton, intercontinental and four seasons already established in brickell/downtown and… Read more »
Anonymous
Bori
7 years 7 months ago

Gables, you are completely right, Lucas has done a magnificent job of packaging market data that helps a lot into understanding the actual RE scenario. But at the end of the day, the socioeconomic topics you just mentioned are the ones that really shape the ups and downs of this RE market, for the last 35 years I have seen as this socioeconomic fads, (most of them external to Miami or like you said influenced by out of towners) have shaped the prices of Miami RE.

Lucas keep up the good work and Thanks!

Anonymous
Un-Related
7 years 7 months ago
jcrimes said: “Un-related “the unsubstantiated rumors i’m hearing go beyond the hotel. i’ll leave it at that.” I know exactly where you would be going if you went on……. My “Stalingrad I, II, and III” for Icon may be prophetic…although anyone should be able to see the obvious. When Big Gourge said, in closing a 2005 Herald interview: :” If I am wrong, they may find me under a bridge.” THAT BRIDGE may be at 4th and Brickell……. jcrimes also said: “but…looking at the hotel, if fenoglio sells that…they should get a massive bonus (i’ve worked with some folks there… Read more »
Anonymous
7 years 7 months ago
forbes miami 9 th worst city……..if you are from the north east looking for miami condos, your not looking in this area!!! you want the beach aventura etc, the recession/depression is not even 50% finished, so if you ar buying now-you are buying a falling knife!!!there is no easy credit anymore, the average person does not understand this fact!!!!!!if you still have credit cards and a job, you are ahead of the game, forget about buying condos!!!! take out the scammers, the flippers, the ny ers are not moving to florida anymore/, no more easy credit, new rules and regs………..its… Read more »
Anonymous
7 years 7 months ago

LARA, IT IS DISASTER OF WORLD “PROPORTIONS ” ? DO YOU FOLLOW THE NEWS ??
LOOK AT THE STOCK MARKET WHICH TRADES 6 MONTHS IN ADVANCE USUALY IT IT JUST BROKE THE NOV 20 TH LOWS NOW WE ARE CLOSE TO 2002 LOWS…….
IF GEITNER DOES NOT HAVE GOOD INFO THIS WEEK, S AND P HEADED TO 620
THIS IS A DISASTER
I JUST WISH I DID NOT PAY MY BILLS SO OBAMA COULD SAVE ME

Anonymous
Un-Related
7 years 7 months ago

drew299 said: “I JUST WISH I DID NOT PAY MY BILLS SO OBAMA COULD SAVE ME”

OBAMUNISM overlooks one fact in saying “fewer foreclosures = higher, stable prices”. What it overlooks is the fact the just because you put a higher price on something, it value doesn’t necessarily increase.

OBAMUNISM will hit a wall…like ole Dale Earnhardt did!

Anonymous
7 years 7 months ago

rant of the year!!!! I AM SURE Y’ALL SAW IT ALREADY BUT IN CASE YOU DIDN’T

http://www.youtube.com/watch?v=bEZB4taSEoA

buy gold aem

we are the new europe

Anonymous
2pence
7 years 7 months ago

Stocks (Dow) are down to 1997 levels. Why should real estate be any different? Factor in massive Miami oversupply, rising unemployment, unaffordability of Miami condos, and I see no reason for condo prices to rise in the near term future.

Peak prices were a fantasy. They are never coming back in real terms. Get over it.

Anonymous
7 years 7 months ago

“peak prices were a fantasy” yes but i think even 40 %off peak is also a fantasy

ya gotta know when to hold em and know when to fold em

Anonymous
BMW M3
7 years 7 months ago

Lara is obviously in denial/delusional. She’s in up to her eyeballs in mortgages. She also doesn’t understand what’s going on (and the big big surprise that’s coming) because she keeps harping about “deals”. Honey, it isn’t a deal unless you’re getting it for 25% of what it cost to build.

Anonymous
moretroops
7 years 7 months ago

I’m starting a granite countertop business. Please contact me if you want to get in on the ground floor. Serious investors only. Suzanne said we can do this.

Anonymous
7 years 7 months ago

Samson & Bori,

Thank you! Yes, it does take a long time to compile the data included in this post. Good thing I enjoy working with numbers.

Anonymous
lara
7 years 7 months ago

BMW M3,

I can be wrong in a lot of things and I might be delusional. Yes, I do have mortgages but I do make money with today’s deals. Not a lot of money but all the time in the current market. Do you? All my negative cashflows in some properties are covered with positive cashflows in others. So I can handle my mortgages.

You cannot be always negative. the current situation is a complicated one but if you are an investor you should try to find your way to deal with it

Anonymous
samson
7 years 7 months ago
Lucas: You are very welcome. Keep up the great work and this great blog. BTW, I was given a tour of Icon Brickell last week. I thought I’d hate it and almost didn’t go. Instead, I thought it was fabulous. Provided the building enforces a dress code in the common areas (white/black only, no sweatshirts, baseball caps, etc.) and keeps the place up to snuff, I’d live there in a heartbeat. Best building of them all. And what a credit to Miami. No other city anywhere in the world has anything close. If it were located on the beach, it… Read more »
Anonymous
jcrimes
7 years 7 months ago
Samson i toured the place a few months back. you point out the major problem with the place, it’s not on the beach, thus, the prices need to be adjusted accordingly. second, the common areas are impeccable, but, my take is that’s irrelevant. it’s the units that matter, and frankly, they are not that impressive when you consider you can get the same product in other buildings in brickell at a significant discount. i agree, if the men’s locker room, suana and steam room was my own personal bathroom, yeah, then icon brickell would be the best building in miami.… Read more »
Anonymous
moretroops
7 years 7 months ago
I’ve been to two functions at Icon Brickell now. The project is stunning. Truly. A testament to the credit bubble. The units themselves, however, are merely so-so. I found the kitchens small, and the bedrooms undersized. The views are great if you’re facing east or you happen to be on a high floor. Otherwise they’re not so good — a huge number face … other units. And of course the HOA fees will be brutal. I have been told that, from an accounting perspective, the project is bankrupt. I’ve also heard that a throng of bankers convened on Miami couple… Read more »
Anonymous
Tex
7 years 7 months ago

Miami Rental Market.
Does anyone have any suggestions on the submnarkets and buildings that will prove to be the most popular condo’s for rentals? Preferably something very walk-able near retail, and quality but not over-the-top HOA’s.

Thanks

Tex

Anonymous
Raffi
7 years 7 months ago

tex, if your looking to rent why do you care about HOA’s? you wont be paying them.

Anonymous
Un-Related
7 years 7 months ago

moretroops, in his back-handed compliment to Icon, said: “I have been told that, from an accounting perspective, the project is bankrupt. I’ve also heard that a throng of bankers convened on Miami couple of weeks ago to discuss next steps. Don’t know what happened.”

Big Gorge being wheeled to the edge of the abyss. The “fat lady” is warming up in the background!

Once again: “STALINGRAD I, II, and III”

Anonymous
RCR
7 years 7 months ago

Big Gorge will be fine. I can’t imagine his personal exposure will be anything that leaves him with less than a major fortune.

Anonymous
samson
7 years 7 months ago
Apart from the model’s mouth, a pretty lifeless ad for the Viceroy at the Icon Brickell appears on page 109 of today’s NY Times Styles Magazine. Anybody know what the total debt on the Icon Brickell is? Depending on the amount, if I were the developer I’d run the numbers as a co-op, i.e., sell the units for a small amount of cash each but subject to their pro rata share of the existing debt (extended, say, for 5 years, at which time each buyer would have to (but perhaps could) obtain refinancing thereby converting the building back to condo… Read more »
Anonymous
sunsandandfun
7 years 7 months ago

The problem with Icon Brickell is that its located in……Brickell. All those pretty Ocean Drive magazine ads made Brickell seem like the bustling Las Vegas strip or Rodeo Drive. Its not a vacation mecca and never will be. Miami is not NYC, and anyone making decent money is going to want to live on the beach.

And like someone else said, half of the views completely suck.

Anonymous
Un-Related
7 years 7 months ago
samson said: “This approach also answers the problem of today’s lack of condo acquisition funding. By having each purchaser assume a share of the existing debt, you have in effect given them acquisition financing. In essence, the construction financing is converted to 1,700 individual co-op loans. Of course, the question is how much existing debt we’re talking about….” Let’s see…..you suggest the lenders restructure one or two loans into 1,700 loans on units sold at the very height of the market. Unfortunately, you overlooked a few realities dreaming up this scenario: 1. How many of the 1,700 purchasers would be… Read more »
Anonymous
samson
7 years 7 months ago
Un-Related: As to your point #1, there are – to the contrary – certainly 1,700 prospective purchasers out there with decent credit who could of course close if they were offered, say, 95% financing via the conversion of the project to a co-op. As to your point #2, what you assume might happen (all those in contract taking their money back and “running for the hills”) would be a far better scenario for the developer if the co-op approach worked especially given the avoidance of the protracted litigation now looming by those currently in contract. As to your point #3,… Read more »
Anonymous
Tex
7 years 7 months ago

Raffi. The reason that I care about HOA fee’s is that I want to buy a condo and rent it periodically while I travel, and I want to buy one in a popular area that can easily rent and that doesn’t have high HOA’s.

Any pointers would be much appreciated.

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