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Miami to Become the Vegas of the East Coast?

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Miami casinos

Genting Group, a Malaysian developer which purchased 140 acres of waterfront land in Downtown Miami for $236M on May 27, has contracted the world-renowned architectural firm, Arquitectonica, to design a $3 billion gaming resort called Resorts World Miami.  Genting Group has vast experience in the gaming industry.  In fact, it is the third largest casino company in Asia.  Currently, the Florida legislature has yet to approve a bill allowing full-based casinos to operate in the state but that has not stopped casinos from increasing the money they spend on lobbyists to push a bill through the Senate to change that.

What kind of impact do you think a Miami-based casino will have on the city?  Will property values in Downtown Miami be positively or negatively affected?



139 thoughts on “Miami to Become the Vegas of the East Coast?

  1. Genting is a $45 Billion Dollar company and they can sway any legislature and Rick Scott will be more than willing. It is another 2 years before Herald relocates. Ample time to change the laws before breaking ground. So for your question: will Miami take over the title of “Vegas of the East” from Atlantic City? Don’t Know. But a Vegas style Casino looks certain at the 13.9 acres of Herald. How will a $3 Billion project impact Downtown Prices? Significant upward pressure.

    Here is the write up in todays herald. It looks like the laws may be changed to allow gambling in Miami. I am surprised that 50% were in favor. With that kind of support and Gentings money power, it is a foregone conclusion.
    “The poll also asked voters whether Las Vegas-style casino gambling should be allowed in downtown Miami or Miami Beach. Gaming operators have been pushing for an opening in Miami and the issue has become especially pressing after Malaysia-based casino operator Genting Group recently paid $236 million for the 13.9 acres of downtown bayfront land that has long been home to The Miami Herald. Genting has already starting lobbying state legislators and local leaders for a law change so it can have a casino on the site.
    In the survey, 50 percent of respondents support casino gambling in downtown Miami and Miami Beach, compared to 38 percent against. The other 12 percent said they don’t know.”

    • Not to mention this project is supposed to create 10,000 permanent jobs. It’s hard to turn down a project like this during these economic times.

      However I really don’t think this will do much to rival Vegas. We would need dozens of these projects side by side for that. It does however help to build up downtown. I’ve headed out to the Hard Rock a few times, especially when friends come to visit. With something like this downtown it would really help to create a better city feel, instead of having to drive out to Hollywood. And it really helps bring people downtown from the beach. I’d also expect a lot of business to follow making this a great area. I believe they also have agreements with the Adrienne Arsht center.

  2. When you consider this in context with the Brickell Citicentre project that was just approved by the planning board 7-0 it gives you an ideal about the future of downtown Miami.

    7 million sqft $3 billion dollar project to the north of the central business district. 5 million dollar sqft $700 million dollar project to the south of the central business district. Related working on Omni redevelopment in the middle. And it seems people like Nitin aren’t giving up on World Center either. And having a casino nearby definitely wont hurt.

    And the good this is that Swire and Genting are huge companies that have the ability to self finance these projects.

  3. Have to agree with gixxer. while i don’t really see a great downside to the casino, the implication this makes miami the vegas of the east coast is hyperbole. it is one casino. in order to be a gambling destination, like vegas or AC or macau, you need alot of casinos. and we dont have the cheap land for expansion like vegas. but it does create a complement to beach tourism. casinos have appeared in a number of locations throughout the country touting great economic opportunities. i have not seen them achieve these high expectations, but neither have i seen them bring in the doom and gloom of the protestors either. now will arsht center folks patronize the casino after a show?

    • so do you want your million dollar apartment overlooking the roof of a mega casino… how do you expect the traffic to be with deliveries and garbage removal you are a block away from Adrian Arscht and feel the traffic of every event at the AAA.. this is going to be a nightmare… and lets not forget the Indians would have a field day fighting this in court.

      • robert, not sure which existing buildings would be forced to overlook a new casino. certainly not the four in front of museum park. traffic issues are part of the expectation of living in a city. you cannot live in an urban environment and expect to avoid urban issues! it’s the tradeoff for being able to walk to your food and entertainment.

      • There is a 5 year treaty with Indians for not allowing any other casinos. That will be renegotiated soon. In any case the penalty for breach is The Indians don’t have to pay the state a few million dollars every year as royalties or fees. That is a small price to pay.

  4. I also wanted to point out that this project is slated to be built with or without the casino, hence the purchase of the land. The casino just speeds up the pace of development as they would be able to recoup profits faster. The vast majority of this project will be a residential and entertainment complex.

  5. 140 acres of waterfront … lets proof before we post guys… that type of acreage doesn’t exist we would need to build up from Biscayne Bay and still wouldn’t get 140….

  6. I think the casino part of this is pie-in-the-sky. It doesn’t matter if 50% of Miami residents are in favor of it. Without state approval, it can’t happen, and even if Florida approves gambling, I highly doubt Miami would be first in line.

      • Once again Joe throwing out his negative opinion without even remotely trying to understand the situations. These casino companies are lobbying for destination resort style casinos at specific locations and not simply the right to allow gambling in Florida. Furthermore the new legislation that they are trying to pass is focused specifically on South Florida.

        I’m not saying its going to pass but if it does it will be for specific locations in South Florida. So yes, Miami would be first in line.

        You don’t lobby for the right to build casinos unless they are going to approve them for the lost that you just bought for $236 million and planning on spending another $3 billion.

        I would think with you cynical view of Florida politics you’d at least assume that.

        • Gixxer 1000 — I understand the situation perfectly well. Do you think these guys are the first to propose casino gambling in So. Fla.? (The answer is no.) Do you think these guys are the first to go to Tallahassee to lobby for legalized casino gambling at one or more sites in Florida? (The answer is no.) Do you think Miami is first in line for favors from the Florida state government when it’s on the verge of receivership? (The answer is no.)

          • Obviously you don’t. Genting is part of a group of casino operators that have been pushing for this. And like I said they are pushing for a bill that allows for resort casino destinations at certain locations.

            I’m not saying that they will get the legislation approved, but the legislation they are trying to get approved is for specific locations in South Florida. You make it seem like if Florida approves gambling then there will be a fight to see where in the state it goes, which is wrong. The bill they are working on will either be passed allowing gambling at specific locations with this being one of them, or it will be disapproved. Those are the only options. There is no option for passing a bill to allow casinos and then build one in Jacksonville.

            These guys are going to the Tallahassee and saying look, we are a world casino operator and we can bring 10,000 jobs to your state, addition tax revenues, etc. if you allow a casino at this location that we already own. If they say, then fine. But they aren’t going to say no and then turn around and say any Joe can build a casino somewhere else.

            The top Casino operators have already identified locations where they want these casinos to go and they are in places like downtown Miami and Miami Beach. Genting, Wynn Resort, MGM Resorts International and Caesars Entertainment are the main players. And they are trying to build destination resort casinos, they have no desire to build them anywhere but South Florida. It’s hard to build a destination resort with a destination.

  7. Without a doubt an additional source of revenue would boost Miami economy and thus increase property values. If straight-laced Singapore (probably the most money-wise place on Earth) went for it, then Miami should to. Nothing to be afraid of. Make it big, make it spectacular and make it transparent. It should be a go. People who want to lose their money might as well do it here.

  8. My only disappointment comes from the choice of Architectonica as the design outfit by both Swire and Genting. I guess rumor of Santiago Calatrava being considered by Genting was never true, and it’s a shame. Looking at Architectonica buildings, I can’t think of a less imaginative approach to architecture. Maybe they can pull it off, but I have my doubts. Miami needs something mind-boggling, and the only thing that boggles the mind about Architectonica is just how pedestrian it is.

  9. I got to admit I do not understand the economics of a Casino City and why the other city by the sea with heavy influence by Casinos, Atlantic City, has had its share of significant economic troubles vis a vis Las Vegas. Common sense tells me Las Vegas casinos had been successful due to its high volume traffic generated by Conventions, something Miami would not be able to compete with.

    Downtown residents must comp-template if they want to live by the businesses surrounding casinos, pawn shops, quick marriage operations, prostitution, drug purveyors, sleazy characters etc etc. Demand for family living in downtown will evaporate thus driving real state prices down.

    • It all depends, as always. Casinos don’t necessarily go hand in hand with all of the problems you are terrified of. Monaco is not exactly a drug den infested by cheap whores. You build it right, you regulate it properly and you can’t go wrong with a casino. Granted, it may not be a family Mecca (no urban core of any major city in the world is), but it doesn’t have to be a total Sodom and Gomorrah either. That “quick marriage” thing was cute. To further calm you down, I am sure there won’t be state-sanctioned pedophilia, bestiality districts, or legalized drinking at age 7 in downtown Miami.

  10. Boris, those are bigger problems in casino towns. a miami casino will market to and cater to a higher end clientel. you accomplish this by being a destination site (ie people fly in, leave, and then fly out). vegas has had success with this model. atlantic city has struggled because they went for a more local and regional approach (NYC and Philly)-hence the senior bus tours. this has led to more local problems.

    • I agree with gables. Boris you seem to be making gambling synonymous with Vegas. As gables pointed out this is a destination resort. Gambling will be a small part of it. This project will have a convention, entertainment, restaurant, retail, residential and commercial facilities.

      I go out to the Hard Rock in Hollywood and the last time I checked its not surrounded by “pawn shops, quick marriage operations, prostitution, drug purveyors, sleazy characters”.

      You should check out their website:

      http://www.rwgenting.com/

      From that site you can get to all their international resort world locations. If anything their style screams family vacation and not prostitution.

  11. Please, this is all bullshit. Building a casion in the middle of Miami in the state of florida and everything will be just peachy with none of the problems associated with other places. Hell, there are no casinos in Miami now and the place is mess. I’m sure the gamblers and seedy elements associated with gambling will make it a slice of heaven. Who are you guys trying to fool? Don’t get me wrong, I am not saying this could not be a net positive for the city but quit fooling yourselves. With all these impending buildings being planned looks like we may be on our way to the next wave of condo boom to start.

    Hey did anyone see the CNBC report saying there are only about 100 units of supply in Ft. Lauterdale, is that even right?

    • What’s this rhetorical device called that you just had used here? Must be hyperbole, combined with false choice. But I would characterize it as a half-assed attempt at looking original – and failing in the process. Because nobody ever said that casino is a garden of moral virtue. What was said is that casino is not an automatic negative, although just as any other economic activity it has two sides to it. If you have a tourist destination beset by high unemployment, collapsed property values and woeful public finances, then casino is a legitimate way at capturing extra revenue and attracting extra clientele.
      Well, anyways, can someone honestly say that Las Vegas became a better place to live after great deal of gaming revenue got redirected to Macau?
      More moral, more successful? Probably not.

      • And I wish people would spend 5 minutes looking at the other resort world locations that Genting operates. They are also trying to open up one in NY as well.

        Their target audience is not a typical Vegas vacationer.

        At least spend 5 minutes trying to understand the situation before you make a knee jerked reaction.

  12. most of you people fail to acknowledge we already have gambling throughtout south florida at the tracks. slots exist at several locations, and will already have a monopoly on the sleaze that may be attracted to a casino. your trouble will be in those areas, not at a downtown casino where it will cost $20 just to park and enter the establishment! you think adding blackjack and poker to the mix downtown will make downtown even worse?

  13. You’re all a bunch of trendy pussies. Real men do their gambling at Magic City Casino/Flagler Dog Track.

    It doesn’t get any better than wagering on greyhounds followed by an Air Supply concert.

  14. Gixxer 1000 — Judging by your political analysis, you should stick to real estate.

    Gixxer 1000 said: “I’m not saying that they will get the legislation approved, but the legislation they are trying to get approved is for specific locations in South Florida. You make it seem like if Florida approves gambling then there will be a fight to see where in the state it goes, which is wrong.”

    – No, it’s exactly right. Why the hell would legislators from all over the state of Florida grant a cash cow like this to Miami but not to other areas in the state? And with other parts of Florida having equal or bigger financial problems, why do you think Miami is first in line?

    Also, you think the Florida Legislature gives a rat’s ass what Genting wants? If Florida approves casino gambling but only in Fort Myers, there’d be 20 companies lining up to build the casino(s). Don’t kid yourself (or us).

    Gixxer said: “The bill they are working on will either be passed allowing gambling at specific locations with this being one of them, or it will be disapproved. Those are the only options. There is no option for passing a bill to allow casinos and then build one in Jacksonville.”

    – Right, and all of the above could be changed within 10 seconds by amending any of the pending bills. Since when is any state-level legislation “as is” or “take it or leave it”? This isn’t an amendment to the U.S. Constitution we’re talking about here.

    Gixxer said: “These guys are going to the Tallahassee and saying look, we are a world casino operator and we can bring 10,000 jobs to your state, addition tax revenues, etc. if you allow a casino at this location that we already own. If they say, then fine. But they aren’t going to say no and then turn around and say any Joe can build a casino somewhere else.”

    – Again, Genting isn’t offering or proposing anything that hasn’t been offered or proposed 100 times before. Get serious.

    Gixxer said: “The top Casino operators have already identified locations where they want these casinos to go and they are in places like downtown Miami and Miami Beach. Genting, Wynn Resort, MGM Resorts International and Caesars Entertainment are the main players. And they are trying to build destination resort casinos, they have no desire to build them anywhere but South Florida. It’s hard to build a destination resort with a destination.”

    – Casinos are approved these days to spur development. As such, Miami is probably the LAST place in Florida likely to be approved for gambling. Why would “booming Miami,” as you describe it in your bullish commentary here, need a casino when it’s already booming? If Florida approves casino gambling, it’s likely to follow the Vegas model, by starting it in areas that can grow. Downtown Miami is not such a place.

  15. joe, your arguments do not jive with how gambling has emerged in other states of the nation. casino’s are approved site specific only after a particular gambling company has emerged to lobby for that site-backed up with plans on the construction, operation, economics, etc of the proposed casino site. you will not get a blanket offer to open just anywhere in florida. and a casino operator will not open in a city where they must “build” the tourism-too much cost and investment. orlando is off the list due to disney. voters in retirement type communities will not approve a casino either. that only leaves a select couple of locations. miami is probably top on that list. i could not fathom an international gambling corp with interest in building a casino in ft meyers! people would rather gamble in the bahamas!

    • gables — My comments above weren’t incorrect in the least. Show me some areas that were doing well financially or developmentally in which a casino was approved in the midst of the boom. It simply doesn’t happen. Casinos are seen as a last-ditch type of effort to spur development.

      Fort Myers was just an example to make a point, and even as outlandish as it might seem, it was still accurate. If Florida approved gambling specifically in Fort Myers, gaming companies would line up to build there.

      I don’t doubt the gaming companies have Miami at the top of their list, but I find it almost impossible to believe the state legislators see things the same way. There are too many other areas that are desperate for development and *don’t* have foreigners spending money like drunken sailors to prop up the local economy.

      • Once again you are so off base. First off building casinos has nothing to do with spurring development. Its about raising revenue. The legislation usually requires some sort of licensing fee, applications fees and taxes. Most of this money goes to the STATE no matter where the casino is located.

        In the report given for the last proposed bill it highlight that Pennsylvania (STATE) took in $1 billion in gaming revenues. In this case the State imposes a 55 cents tax on the casinos.

        A lot of opposition comes from the Seminole tribe which currently has a deal that pays the STATE $150 million annually.

        It’s so funny how you slant everything in a negative tone. Foreign investors move in to buy a lot of properties and now they are equated to drunken sailors and propping up the economy. If Miami started attracting more fortune 500 companies creating local jobs you would position that as evil corporations propping up the economy.

      • joe, obviously you are not familiar with how the casino approval process is done throughout most of the country (outside of vegas and AC). you do not approve ft meyers, then wait for the casinos to roll in. the casino’s lobby for voter approval of a specific site (location, owner, etc already defined). a casino can only be built and operated on such a lot. if another casino wants to open, they must also go through the same approval process-which the original casino will lobby against.

        the casino developer dictates the location, not the state. and financially, it is often far cheaper to develop in struggling areas rather than expensive miami coastline. states just want a cut of the revenue irregardless of where you build. this is why detroit and pittsburgh have downtown casinos. you cannot really afford to build one in chicago or new york-getting approval and land cost make it very difficult. the upscale resort aspect of the miami proposal may help its profitability.

  16. Just came back from a short trip to Montreal and was surprised to see that Montreal has a city center Casino – So why not in Miami – Just surprised that gaming will reach the Miami side before Miami Beach.

  17. Steve Haas eagerly anticipated City hall Restaurant across from paramount on 20th and Biscayne will finally open next week.

  18. F-35 – “You build it right, you regulate it properly and you can’t go wrong with a casino”. Yeah right, tell that to the folks in Vegas and you might want to mention that to Trump. Lot easier said than done.

    Maybe I am missing something but are you telling me that Genting, Wynn Resort, MGM Resorts International and Caesars Entertainment are all lobbying the state so that only 1 casino is built in Miami? If One is built and is successful then the others won’t lobby/bribe the state legislature for additional casinos?

    Listen, I’m not saying the casino idea is a bad idea, I’m just saying it is not the panacea some are making it out to be. Build a Casino and it automatically becomes a success and property values rise across Miami. No mention how a big casino(s) might affect other businesses in the city or at the beach. Forgive me for bringing this up, this is just my half-assed attempt at looking original. I am sure there will be a flood of turist flying into miami just to gamble at this casino.

  19. P&U, interestingly enough, you do not find the same unfinished projects in Miami that you do in Vegas. Even with the crash, miami has better long term prospects the vegas. where would you rather live, the middle of the desert or on a tropical coastline?

  20. nice article drew. carrying costs (tax and HOA) and currency valuations will present an interesting dynamic in the coming years with all the foreign owned condos. especially with the euro. right now europeans buy the condo with the advantage of a strong euro. if the euro does drop substantially (as many predict big problems with the euro in current form), current owners are left with a problem of concurrent increases in HOA and taxes. this is a big deal if the euro drops from 1.40 currently to parity at 1.0. not a big deal if it is a rental, but this exchange rate is a big deal if this is a 2nd/vacation home where the european owner is paying the carrying cost-which could increase by nearly 50% in euro terms! however they could conceivably sell at nominal dollars below the purchase price and still turn a big profit! this would not bode well for somebody buying and selling in dollars who plans on gaining profit from appreciation in a few years! a future strong dollar may be crippling to price appreciation if alot of those condos are foreign owned! miami could very well become a real time case study in currency arbitrage and american real estate!

  21. Singapore casinos defy odds
    By Muhammad Cohen

    SINGAPORE – Marina Bay Sands, the world’s most expensive stand-alone casino resort at US$6.9 billion, held its grand opening a year ago in the teeth of a persistent global economic slump and in direct competition with the world’s second-most expensive casino resort, the US$5.7 billion Resorts World Sentosa.

    Many analysts doubted either resort could turn a profit and failed suitors for Singapore’s two coveted gaming licenses eagerly awaited an opportunity to pick up these pricey properties at bankruptcy sale prices.

    A year later, Marina Bay Sands and Resorts World Sentosa are the world’s most profitable casinos. Singapore’s economy grew a record 14.5% last year, and 8.3% in the first quarter. Booming tourism has helped to fuel that growth, with visitor arrivals up 20% and expenditures up 49% last year.

    http://www.atimes.com/atimes/Southeast_Asia/MF28Ae01.html

    P.S. For those unaware, Resorts World Sentosa is Genting’s facility (the company that bought Herald’s land).

  22. Both measures have maintained double-digit growth so far this year. The Singapore Tourism Board says the casinos have helped to boost the sector’s surge. As Prime Minister Lee Hsien Loong hoped when he proposed legalizing casinos in 2005, the two so-called integrated resorts (IRs) have spiced up the city state of five million.

    “I don’t know how I could have been so wrong,” HSBC regional gaming analyst Sean Monaghan, a pre-opening skeptic, admits. “How could I think the market would be so small?” Monaghan estimates the two casinos’ rate of return on assets is running between 18% and 22%, “even though they’re not finished yet”. Forecasts for this year project Singapore’s casino revenue at US$6.4 billion, which would make it the world’s number two gaming destination, just ahead of the Las Vegas Strip and trailing only Macau.

    Last year, combined earnings before interest, taxes, depreciation and amortization (EBITDA) for Singapore’s IRs totaled US$1.75 billion. This year, with both resorts operating for the full year, Monaghan forecasts combined EBITDA in the range of US$2.4 billion to US$2.9 billion.

    He puts a market value on Marina Bay Sands of US$20 billion, representing about two-thirds of parent company Las Vegas Sands’ (LVS) market capitalization. That valuation is virtually equivalent to the market capitalization of LVS’ Hong Kong-listed Sands China affiliate that operates its Macau Venetian, Sands and Four Seasons properties and is building a new integrated resort with more than 2,000 hotel rooms due to open early next year.

    More than money
    But seeing Marina Bay Sands just in terms of money misses much of the story. “There is no doubt that the two integrated resorts have added a new sense of vibrancy to Singapore,” University of Nevada-Las Vegas Singapore campus dean Andy Nazarechuk said. “In the past you would hear comments about Singapore being conservative or boring – you don’t hear those comments any more.”

    Marina Bay Sands has become an architectural icon, with three hotel towers linked by the SkyPark 57 stories above Singapore’s financial district. The resort includes 2,560 hotel rooms, a permanent production of Disney’s The Lion King in one of its two theaters, the lotus-shaped ArtScience Museum, 121,000 square meters of convention space, a 74,300 square meter mall with 300 stores, and more than 50 food and beverage outlets, including cuisine by six celebrity chefs representing four continents.

    Marina Bay Sands “has incorporated everything Las Vegas Sands had learned in Las Vegas and Macau and created one of the most exciting integrated resorts in the world,” Nazarechuk says.

    Despite some teething problems, including a construction site ambience throughout its early months, Marina Bay Sands attracted 19.6 million visitors in its first year. “We are now top of the minds of many leisure and business travelers and have received overwhelming and positive responses,” a spokesperson for the resort said. “With the various attractions lined up and future plans to keep our visitors engaged, we are confident that we will not only sustain but broaden the type of tourists who visit Singapore.”

    Marina Bay Sands targets business travelers and the “meetings, incentives, conventions and events” sector, while Resorts World Sentosa, featuring a Universal Studios theme park, aims at the leisure and family markets. “They appear to be perfectly complementary with regard to their products, facilities and experience offered,” said Robert Hecker, hospitality consultant Horwath HTL-Asia Pacific managing director. “They are mostly attracting and accommodating distinctly different demand segments.”

    As anyone who has visited Singapore recently knows, the addition of nearly 3,000 rooms at Marina Bay Sands hasn’t torpedoed hotel rates. “There were initial concerns it might take a while to absorb the new rooms supply, but the scale of induced demand created extends beyond what the property itself can accommodate, so it’s been beneficial to the entire market,” Hecker said.

    “The IRs have been a 9.5 out of 10,” former Marina Bay Sands chief executive Thomas Arasi said. “There’s a race going on around the region about tourism being part of the future economy. Singapore has just blown past everyone.” Even better days may be ahead as the integrated resorts come fully online. Resorts World Sentosa still has a record-setting aquarium, a museum and a water park in the works.

    The gaming market, meanwhile, could get a further boost from the introduction of junket promoters to bring in VIP players. Dozens of promoters have applied for licenses under the stringent regulations of Singapore’s Casino Regulatory Authority, but none have won approval so far, even though gaming tax rates favor VIP play.

    “Singapore said if you do junkets our way, you can have junkets,” Arasi, now president and CEO of Harbinger Advisers, recalls. “The Singapore government isn’t saying what junkets can do; it’s about who the Singapore government is willing to license.” He suggests “travel agents on steroids” might be what Singapore wants, rather then the junket promoters from Macau and other jurisdictions whose capitalization and collection practices are often murky. “It’s a huge opportunity for junkets and for Singapore.”

    It’s such a huge opportunity that Arasi thinks that successfully introducing junkets will give the Singapore market a big enough boost to convince authorities to license a third casino when the government’s guarantee of exclusivity for the current IRs expires in December 2016.

    “Even though licensing is only possible in 2016, it doesn’t mean someone can’t start building today to position itself as a favorite son for a license,” Arasi notes. Just this week, US casino magnate and billionaire Steve Wynn told Bloomberg he’s “dying” to do something in Singapore.
    ______________________________________________________________________

    If this article is accurate, then I think for Miami to voluntarily give up such an economic opportunity would definitely qualify as either monumental stupidity or equally monumental economic sado-masochism. Might as well close down all drinking holes, strip joints and become perfectly moral – and perfectly dead – city.

  23. Gixxer 1000 said: “It’s so funny how you slant everything in a negative tone. Foreign investors move in to buy a lot of properties and now they are equated to drunken sailors and propping up the economy. If Miami started attracting more fortune 500 companies creating local jobs you would position that as evil corporations propping up the economy.”

    – Foreign buyers ARE spending like drunken sailors, in large part because of the weak dollar. This is indisputable. The r.e. market in the rest of the U.S. is a mess. If not for Miami being a Mecca of sorts for wealthy Spanish-speakers, Miami’s r.e. market would be a total disaster right now. You can’t possibly dispute this, can you?

    (Your second comment is just silly. I’ve always said Miami’s No. 1 problem is that it needs more companies and good jobs.)

    ——

    gables said: “financially, it is often far cheaper to develop in struggling areas rather than expensive miami coastline. states just want a cut of the revenue irregardless of where you build. this is why detroit and pittsburgh have downtown casinos.”

    – Detroit and Pittsburgh are two struggling, if not dying, cities while Miami is booming, at least from a development standpoint. I’m still waiting for an answer to my comment above: “Show me some areas that were doing well financially or developmentally in which a casino was approved in the midst of the boom. It simply doesn’t happen.”

    Beyond that, you and Gixxer and others still haven’t even acknowledged the basic political reality, which is that Tallahassee isn’t going to see Miami as being first in line for a casino. I understand this company PREFERS Miami, but that could change quickly with some political horse-trading. There’s simply no way Tallahassee is going to hand all these jobs and huge potential tax revenue to Miami alone, without giving Tampa or Lauderdale or some other city an equal crack at it. Let’s face it — half the legislators in Tallahassee would like to chop Miami off and let it float out to sea.
    ——

    gables said: “P&U, interestingly enough, you do not find the same unfinished projects in Miami that you do in Vegas. Even with the crash, miami has better long term prospects the vegas. where would you rather live, the middle of the desert or on a tropical coastline?”

    – Short-term, Miami is definitely better off, but with wealthy people fleeing California in droves, Vegas might be a better long-term bet. Vegas simply got overbuilt during the boom, and it doesn’t have wealthy foreigners bailing it out like Miami does. The problem with Vegas right now is that a lot of wealthy Californians are locked into their current homes because of the stagnant r.e. market, but that will change eventually.

    ——

    Drew said: “Good article about high condo assn fees relative to investment return. Fees for the smallest Paramount Bay unit (1,128sf) in 2013 may be as high as $1,138/month. Absurd.”

    – Yup. We talked about this a year or two ago. No way the average young professional in Miami can afford these fees, and there aren’t all that many professionals in Miami in the first place. This is why the condo market stagnated until the foreigners started buying.

    ——

    gables said: “nice article drew. carrying costs (tax and HOA) and currency valuations will present an interesting dynamic in the coming years with all the foreign owned condos.”

    – The real interesting thing will be possible foreclosures of said condos over unpaid HOA fees. I know a lot, if not most, foreigners have paid cash, but foreign buyers are somewhat notorious for being less than fanatical about paying condo fees on time (or even semi-regularly). It doesn’t take much for HOAs to end up in a cash crunch; if the Euro or R$ crashes, things could get interesting.

    ——

    F-35 said: “If this article is accurate, then I think for Miami to voluntarily give up such an economic opportunity would definitely qualify as either monumental stupidity or equally monumental economic sado-masochism. Might as well close down all drinking holes, strip joints and become perfectly moral – and perfectly dead – city.”

    – Miami has relatively little say in the matter. Beyond that, comparing Miami to Singapore is apples to oranges. As the article said, Singapore was considered “conservative or boring” before the casinos, while no one ever says that about Miami. I don’t doubt the casino itself would be wildly profitable in Miami, but I’m not so sure it would be a huge net boost to the local economy — i.e., I bet the cannibalization rate would be quite high. I find it hard to believe tourist gamblers will choose downtown Miami over places like Vegas or Atlantis, and both locals and tourists who go to the casino will simply be spending at the casino instead of spending somewhere else. The only way the casino is a huge net boost is if people come to Miami SPECIFICALLY for gambling.

  24. Joe, you are truly an inspiration to every idiot in the world. How you survived beyond the ripe age of three is a mistery to me, but if you could do it, then everyone can. Re-read the article, sit on it for few years (few hours for a smart person, few days for an average one), then come up with another lame try. I just cannot start laughing at your posts, every one of them.

  25. Joe, that would be “stop” instead of “start”, of course. I started long ago, please forgive me for the verbal mishap. Keep posting, don’t halt, please.

    • Arguing grammar in internet posting seems a little ridiculous. It’s not like people are proofreading their comments.

      But what is pretty idiotic is the way that you read that article about HOA fees and simply listen to hype. $1,138 is not absurd for a 1,124 luxury condo. It’s essentially a 2/2, and as the article points out it’s $1.01 per sf. That’s pretty much in line with the average of a south beach condo.

      In contrast what that article shows is that HOA fees downtown are about HALF of what they are on the beach. So if downtown HOA fees are unaffordable then how are South Beach condos surviving at double the cost??

      And once again while a lot of people seem to complain about HOA fees most of them don’t take the time to understand what all it covers: maintenance and landscaping; upkeep for pools, gyms, spas, entryways, tennis courts, garage, common areas, roof, trash, water, cable tv; insurance (hazard, wind, flood), and a reserve fund for future painting, paving, and more. If you own a single family home and add up all these separately, often you will find that it actually costs less per month to own a condo.

      But as in the past I’d like to point out a big one, insurance. Here is a 2010 income/expense report:

      http://www.naahq.org/SiteCollectionDocuments/Industry%20Resources/2010%20Income%20and%20Expenses%20Survey.pdf

      As you can see insurance on properties averages about $0.25 per square foot. And considering Downtown and South Beach’s location I’d expect insurance to be higher than average. But even using the average numbers that would mean that HALF of downtown’s $0.54 goes to just insurance.

      • you cannot be a cheapskate and live in a condo. it costs money-and on a regular basis. the only way a condo is cheap is if you buy at a low price. you can pinch pennies in your own house, but you cannot do that in a condo building. it is funny how people think they should not have to pay for gyms, pools, etc in their condo because they don’t use them. then don’t live in a luxury building! in many buildings, you pay the equivalent of $100-$200k plus of mortgage monthly in HOA. that is hard for a budget conscious owner to swallow!

        • I agree mostly. My only disagreement is that not every condo is a luxury condo. There is a lot of cost savings associated with living in dense units in the city. Not every condo has tennis courts, spas etc. I guess you could choose not to cut your grass, fix the roof or cut off the cable bill. But for the most part you should simply choose a place that is inline with your budget. In these arguments people seem to take the highest luxury buildings and present them as the average. The average fee Downtown is $0.54. So that means the average HOA fee is under $500. I’m sure most peoples cable, insurance, lawn maintenance, and monthly household repairs tops that.

          But I agree that most people here are being absurd like Drew when Paramount is clearly a luxury building. At the end of the day living in Paramount is still a discount to living at a similar building in south beach, which is the real benefit to downtown. You only a few minutes away in a growing urban environment at a fraction of the cost.

  26. Joe,

    “Foreign buyers ARE spending like drunken sailors, in large part because of the weak dollar. This is indisputable. The r.e. market in the rest of the U.S. is a mess. If not for Miami being a Mecca of sorts for wealthy Spanish-speakers, Miami’s r.e. market would be a total disaster right now. You can’t possibly dispute this, can you?”

    I think you are so caught up in your ideology that you cant hear how ridiculous you sound.First off I like how you automatically equate foreign buyers to spanish speakers when Canadians are the #1 international buyers.

    Putting that oversight aside, YES Miami would be in trouble if not for these international buyers. BUT WHO CARES. That’s like saying the middle east would be nothing without oil. The fact remains that the middle east does have oil and Miami does have a destination that international buyers want and there is a weak dollar right now that makes Miami real estate attractive. It’s not as if the Beach is going to disappear anytime soon.

    And you missed my main point. To say that these international buyers are buying like drunken sailors implies that they are buying irresponsibly. You point out that the weak dollar makes which makes these investments more valuable to foreign investors. I don’t see drunken sailors walking around talking about taking advantage of the difference in currency exchange rates in there investments.

    I don’t know if you can tell but the tone of your comments makes it sound like your disappointing that Miami isn’t doing worse. Like your rooting for it to fail and these damn drunken foreigners are coming in to buy properties and messing it up for you. If only they’d leave you’d actually be able to afford a condo for yourself.

    “Detroit and Pittsburgh are two struggling, if not dying, cities while Miami is booming”

    How come if I say Miami is booming (which I haven’t gone that far) then I’m some sort of real estate shill, but when it suits you to argue against gables you can throw that out there as fact?

    “Short-term, Miami is definitely better off, but with wealthy people fleeing California in droves, Vegas might be a better long-term bet.”

    You constantly down Miami because they don’t have enough jobs and the economy is based on tourism and real estate (over looking the port) and then you turn around and say that VEGAS is a better long term bet???? A city in the middle of the desert with no water supply an no other trade buy Casinos will do better than Miami??? Only a pure hard Las Vegas resident who was assaulted in South Beach as a little kid would say something as dumb as this.

  27. joe, you have this ideology that foreigners are bad-i get it, you are anti-immigrant. but to be honest, i have not seen any indication where foreigners have not and will not pay hoa, at least at a delinquincy rate higher than the typcial american buyer. if i am wrong, just provide a concrete example. foreign buyers may have a currency risk, but the hoa risk-to which at one time i also believed was a problem-has not manifested itself. seems to be a voodoo issue. hoa did not develop into the problems anticiated during this past downturn, for example.

    detroit is a struggling city with a casino-the development was needed. obviously you know nothing about pittsburgh-it is not a dying city and it approved a new casino. in fact, pittsburgh has 7 fortune 500 companies headquartered in the area (south florida has 3). it has superior universities and medical services, industrial reasearch centers, and financial headquarters compared to miami. far less unemployment than miami. no housing bust (no boom either, however). rather than a dying city, as you so ignorantly described it, the city is quite vibrant. and it built a brand spanking new casino! i imagine your knowledge of florida political horsetrading on casinos is about as useful as your knowledge of pittsburgh!

  28. F-35 – Why the hostility? This is a discussion board and we all post anonymously. You have an opinion and I have mine. It’s not like I attacked you above. If you think I’m wrong, explain how I’m wrong. As I said above, I have no doubt a casino would be wildly profitable in Miami. I’m just not sure it will be a huge net boost to the economy, and I think the politics are tougher than people admit.

    ——

    Gixxer 1000 said: “Putting that oversight aside, YES Miami would be in trouble if not for these international buyers. BUT WHO CARES. That’s like saying the middle east would be nothing without oil. The fact remains that the middle east does have oil and Miami does have a destination that international buyers want and there is a weak dollar right now that makes Miami real estate attractive. It’s not as if the Beach is going to disappear anytime soon.”

    – I love how you accuse me of being blinded by some unknown “ideology” but you claim to be a neutral observer. As others have mentioned just within the past few days here, if the dollar starts to gain ground, things could get interesting in the Miami r.e. market. Saying “the Beach isn’t going to disappear” is just dumb. The beach has ALWAYS been there. Foreigners aren’t buying because of the beach; they’re buying because of the weak dollar. Can you at least be honest about that? (And as you should know, most foreigners have been buying downtown, not at the the Beach. The Beach market is still very stagnant, at least above the $200k segment.)

    ——

    Gixxer 1000 said: “And you missed my main point. To say that these international buyers are buying like drunken sailors implies that they are buying irresponsibly. You point out that the weak dollar makes which makes these investments more valuable to foreign investors. I don’t see drunken sailors walking around talking about taking advantage of the difference in currency exchange rates in there investments.”

    – When I read stories about foreigners going to Miami to look for a second home and then buying three condos while they’re there, that qualifies as “drunken sailors” in my book. Right now, because of the exchange rates, foreign buyers are playing with house money (not all house money, but a lot of it), and it’s absurd to suggest that hasn’t had an effect on the market.

    ——

    Gixxer 1000 said: “I don’t know if you can tell but the tone of your comments makes it sound like your disappointing that Miami isn’t doing worse. Like your rooting for it to fail and these damn drunken foreigners are coming in to buy properties and messing it up for you. If only they’d leave you’d actually be able to afford a condo for yourself.”

    – Total nonsense. I have no interest in downtown Miami, so I couldn’t care less what happens in the r.e. market there. My comments here are a simple analysis of what I see happening. Nothing more, nothing less. It’s great that the empty condos of 2008 are now mostly sold, but it’s hard to get excited about a market in which relatively few locals are participating. I don’t see a lot of long-term upside to an r.e. market in which foreigners own and locals rent.

    ——

    Gixxer 1000 said: “How come if I say Miami is booming (which I haven’t gone that far) then I’m some sort of real estate shill, but when it suits you to argue against gables you can throw that out there as fact?”

    – Downtown Miami just concluded the biggest run of development in the city’s history. I’ve never suggested otherwise. (By the way, you chopped off the “at least from a development standpoint” from my “booming” quote, which was kind of dishonest.)

    ——

    Gixxer 1000 said: “You constantly down Miami because they don’t have enough jobs and the economy is based on tourism and real estate (over looking the port) and then you turn around and say that VEGAS is a better long term bet???? A city in the middle of the desert with no water supply an no other trade buy Casinos will do better than Miami??? Only a pure hard Las Vegas resident who was assaulted in South Beach as a little kid would say something as dumb as this.”

    – I know you’re always in a race to reply to everything I say here, but you really should try to read more carefully before doing so. First, I said Vegas MIGHT be a better bet. Second, if not for the weak dollar, Miami would be just as big of a mess as Vegas right now. I didn’t see Brazilians and Canadians and Mexicans lining up to buy Miami condos at the 2005-08 prices. Also, unlike states in the Southwest that are seeing a huge influx of wealthy people fleeing California, the people buying in Miami are often absentee owners who contribute little to the local economy except the home purchase.

    I admire your passion and optimism for Miami and all that. I’m just trying to apply some basic economics to the situation. You talk sometimes like foreigners just discovered Miami three months ago and that the boom will be never-ending. But the current boom, just like the boom in the 2000s, is because of a specific set of circumstances. Just like the 2000s boom came to a sudden halt, so, too, could the foreign-buyer boom. No matter how anyone slices it, Miami’s underlying metrics aren’t much better today than they were three years ago. There hasn’t been an influx of jobs, the unemployment rate is still horrible, etc., etc. You might not like it, but those metrics matter.

  29. gables said: “joe, you have this ideology that foreigners are bad-i get it, you are anti-immigrant. but to be honest, i have not seen any indication where foreigners have not and will not pay hoa, at least at a delinquincy rate higher than the typcial american buyer. if i am wrong, just provide a concrete example. foreign buyers may have a currency risk, but the hoa risk-to which at one time i also believed was a problem-has not manifested itself. seems to be a voodoo issue. hoa did not develop into the problems anticiated during this past downturn, for example.”

    – Man, you used to be an honest participant here, but you’ve gone off the tracks. Where have I indicated I’m “anti-immigrant”? Totally absurd. I said an r.e. market dominated by foreigners isn’t great for Miami, but that’s not the same as being anti-immigrant. (BTW, most foreign buyers are part-time residents or absentee owners.)

    Also, the point was that the HOA fees could be a problem *IF* the exchange rate changes.

    Lastly, I’m not aware of any studies online that compare the delinquency rate for HOA fees of foreigners to locals. I just know that a lot of HOAs have had problems with absentee foreign owners not paying fees on time (or at all), and I also know it can be harder to foreclose because of service issues. (And again, as I clearly stated above, it doesn’t take 200 people to not pay fees before an HOA can get into trouble. It only takes a small number. If the exchange rate moves the wrong way, things could get interesting.)

  30. joe, you constantly berate the foreigners who are absentee, don’t pay their taxes or hoa, and basically are not good for the miami area. i read that as somebody who does not want foreigners in the area. i should recategorize you as anti-foreigner. show me a major building whose hoa developed problems due to deliqnent hoa from foreign owners, and i will change my tune. just seems you are following an urban myth.

    you assume a currency change will result in delinquent hoa payments. i think it is far more likely the exchange rate will simply force owners to sell more quickly and take their profits on the capital. maybe they will sell the property back to an american and make you happy :)

    • Pretty funny because I was reading an article about Brazilians buying in Miami:

      http://realtybiznews.com/brazilians-snap-up-miami-condos/9873547/

      If you go down to the comments a guy name “Joe Rizoli” leaves this comment:

      “Good luck with the Brazilians. They are probably one of the most corrupt people in the world for document fraud. You can bet neighborhoods will be transformed into little favalas and the SPLC and the ADL will be having all sorts of “no place for hate” notices for the community’s when they don’t accept the Brazilians politics.

      When plunder becomes a way of life . . .

      “When plunder becomes a way of life for a group of men living together in society, they create for themselves in the course of time a legal system that authorizes it and a moral code that glorifies it” ~Frederic Bastiat French economist, statesman and author (1801-1850)

      Joe Rizoli
      CCFIILE.com”

      And CCFIILE stands for Concerned Citizens and Friends of illegal Immigration Law Enforcement.

      Joe if this isn’t you, then you might want to sue this guy because he sure has copied your act.

  31. This is good and bad. This is good because it will be golden for the Miami economy and it will make better nightlife. But I know, this is an investment website so, I hate to break it to you but it will drive condo prices down. Look at what happened to Vegas. The condos there are so cheap because they make ALL of their money off of gambling. I think miami prices are going to be driven down because of this. I suggest selling all of your investments!

  32. Joe,

    “The beach has ALWAYS been there. Foreigners aren’t buying because of the beach; they’re buying because of the weak dollar. Can you at least be honest about that? (And as you should know, most foreigners have been buying downtown, not at the the Beach. The Beach market is still very stagnant, at least above the $200k segment.)”

    If they aren’t buying because of the beach then how come all the foreign investment is going into Florida near beaches??? Of all the foreign investment, Florida accounts for the largest share at 31% of the transactions. The next closest state is California at 12%.

    This foreign investment didn’t start because of the weak dollar it just increased. Foreign investment in the US increased from $66B to $83B.

    Originally we both undervalued Miami property because we didn’t look at it as a global product, but clearly it is. It’s not just the value of the dollar its the cost that the dollar makes this product in comparison to other beach property around the world.

    And you’re argument about downtown vs. south beach is ridiculous. Downtown is only a causeway drive away. To a Foreign buyer a condo 15 minuets away from the beach is still a vacation home near the beach.

    And lastly again you go spurting random lines that aren’t simply true. Lucas has been writing multiple post about luxury homes selling, and it has been doing so at above average rates.

    For example Miami Beach condos in the $500k – $750k range have gone from about 10 a month to 30 a month last May. Meanwhile the inventory in that range has gone from 320 to 220.

    I know your still clinging on to last year but in the last 6 months the market has been anything but stagnant.

  33. gables said: “joe, you constantly berate the foreigners who are absentee, don’t pay their taxes or hoa, and basically are not good for the miami area. i read that as somebody who does not want foreigners in the area.”

    – Total nonsense. I’ve made maybe three comments on this topic in the past six months. Unless you struggle with reading comprehension, you know damn well that talking about foreign influence in an r.e. market isn’t the same thing as being against the foreigners themselves. My point, all along, has been that when foreigners can afford r.e. that the locals can’t afford, that’s not a good sign for the long-term health of the city.

    ——

    Gixxer 1000 said: “Joe if this isn’t you, then you might want to sue this guy because he sure has copied your act.”

    – Nice try. Three comments doesn’t constitute an “act,” and I’ve never said diddly about Brazilians. (And just for the record, it’s not me.)

    • joe “foreign buyers are somewhat notorious for being less than fanatical about paying condo fees on time (or even semi-regularly).” you also say they are buying like drunken sailors.

      of course, you were unable to provide any details on those notorious foreigners skipping fees. and i did not know buying condos with cash would be similar to drunken sailors. its not like they are buying overpriced assets with no document loans which will never be paid off.

      if it walks like a duck, and quacks like a duck, it probably doesn’t like foreigners.

  34. Gixxer 1000 said: “If they aren’t buying because of the beach then how come all the foreign investment is going into Florida near beaches??? Of all the foreign investment, Florida accounts for the largest share at 31% of the transactions. The next closest state is California at 12%.”

    – Are you serious? You think Brazilians and Mexicans are buying in Florida because of the beaches, and not because (1.) the dollar is weak and they can get relatively good deals on overbuilt condos and (2.) Florida is chock full of Spanish-speakers?

    ——

    Gixxer 1000 said: “Originally we both undervalued Miami property because we didn’t look at it as a global product, but clearly it is. It’s not just the value of the dollar its the cost that the dollar makes this product in comparison to other beach property around the world.”

    – IT’S A “GLOBAL PRODUCT” BECAUSE THE DAMN DOLLAR IS WEAK. PLEASE GET THIS INTO YOUR HEAD.

    You keep talking like foreigners just discovered Miami three months ago. If Miami is such a “global product,” how come these same foreign beach lovers weren’t lining up to buy at the height of the boom, at the 2005-08 prices?

    ——

    Gixxer 1000 said: “And you’re argument about downtown vs. south beach is ridiculous. Downtown is only a causeway drive away. To a Foreign buyer a condo 15 minuets away from the beach is still a vacation home near the beach.”

    – So people are flying thousands of miles from places like Brazil and Mexico, which have some of the most famous (and affordable) beaches in the world, to Miami so they can live 15 minutes from the beach? That makes great sense.

    ——

    Gixxer 1000 said: “And lastly again you go spurting random lines that aren’t simply true. Lucas has been writing multiple post about luxury homes selling, and it has been doing so at above average rates.”

    – You posted a chart about this several weeks ago that plainly showed a stagnant high-end Beach market. Please don’t try to B.S. us with revisionist history. The numbers were there for everyone to see.

  35. Joe,

    “I know you’re always in a race to reply to everything I say here, but you really should try to read more carefully before doing so. First, I said Vegas MIGHT be a better bet. Second, if not for the weak dollar, Miami would be just as big of a mess as Vegas right now. I didn’t see Brazilians and Canadians and Mexicans lining up to buy Miami condos at the 2005-08 prices. Also, unlike states in the Southwest that are seeing a huge influx of wealthy people fleeing California, the people buying in Miami are often absentee owners who contribute little to the local economy except the home purchase.”

    There is no might about, Vegas has absolutely no chance to do metter than Miami. And foreigners were lining up to buy condos up until the market busted, their demand helped create that bust.

    And I like how you try to throw in Southwest instead of Vegas. People AREN’T leaving California to go to Vegas. They are head to places like Arizona and Texas.

    And Florida still has more interstate migration than Nevada. You could have tried to make that argument for a place like Austin, but Vegas???? Just shows your ignorance.

    “Downtown Miami just concluded the biggest run of development in the city’s history. I’ve never suggested otherwise. (By the way, you chopped off the “at least from a development standpoint” from my “booming” quote, which was kind of dishonest.)”

    That boom clearly ended in 2007. So you are arguing that Miami can’t get a casino because its a booming city, but that boom clearly ended 4 years ago? That boom went bust and were now in the process of moving out of that bust.

    “No matter how anyone slices it, Miami’s underlying metrics aren’t much better today than they were three years ago. There hasn’t been an influx of jobs, the unemployment rate is still horrible, etc., etc. You might not like it, but those metrics matter.”

    Wow! You think the 2011 market isn’t better than 2008???? You clearly don’t know anything about the market. First off look at who is unemployed. The lower down the ladder you go in terms of education and salary the higher the unemployment.

    The next round of development will be multifamily rental housing at a lower cost. This will allow the release of the pent up demand of people living with family members, each other, etc. Once they begin this building that will then put more people to work and the snowball effect will begin once again.

    Explain to me again what jobs you’re waiting for and where were these jobs during the last few boom and bust periods in Miami?

  36. Gixxer said: “There is no might about, Vegas has absolutely no chance to do better than Miami. And foreigners were lining up to buy condos up until the market busted, their demand helped create that bust.”

    – Then why didn’t they close on the condos? It’s not like Americans defaulted and foreigners closed. If Miami is such a “global product,” why was there such a lag between the bust and the wave for foreign buyers? I’ll tell you why — the demand is due to the weak dollar, and not because of any specious claims that Miami has turned the corner as a “world-class city” or any of that other nonsense people spout on boards like this one.

    ——

    Gixxer said: “And I like how you try to throw in Southwest instead of Vegas. People AREN’T leaving California to go to Vegas. They are head to places like Arizona and Texas.”

    – Nonsense. I know at least 10 people who’ve moved from California to Nevada. Vegas simply got way overbuilt and it doesn’t have foreign buyers bailing it out.

    ——

    Gixxer said: “And Florida still has more interstate migration than Nevada. You could have tried to make that argument for a place like Austin, but Vegas???? Just shows your ignorance.”

    – I never suggested otherwise re: Nevada. Way to win another straw man argument, Gixxer. You’re the man.

    ——

    Gixxer said: “That boom clearly ended in 2007. So you are arguing that Miami can’t get a casino because its a booming city, but that boom clearly ended 4 years ago? That boom went bust and were now in the process of moving out of that bust.”

    – Really, it ended in 2007? It seems like you’ve posted at least 10 links lately re: planned developments.

    ——

    Gixxer said: “Wow! You think the 2011 market isn’t better than 2008???? You clearly don’t know anything about the market. First off look at who is unemployed. The lower down the ladder you go in terms of education and salary the higher the unemployment.”

    – Good grief, more nonsense. I never said the r.e. market wasn’t better. I said it’s better because of foreign buyers, and not because locals have made economic strides and can now afford r.e. that they couldn’t afford in 2007 or 2009. Again, setting straw men on fire might be fun, but it’s not an honest way to have a dialogue.

    ——

    Gixxer said: “Explain to me again what jobs you’re waiting for and where were these jobs during the last few boom and bust periods in Miami?”

    – This is the whole point. Yet another boom without any underlying improvement in the local economy’s metrics is just B.S. and will bust just like the last couple. Why you see this as progress is beyond me. Cheap credit boosted the r.e. market, and then it busted. Now the weak dollar is boosting the market, and that could lead to another bust. Yawn.

  37. gables said: “of course, you were unable to provide any details on those notorious foreigners skipping fees. and i did not know buying condos with cash would be similar to drunken sailors. its not like they are buying overpriced assets with no document loans which will never be paid off.”

    – You people seem to have short memories. No more than a year or two ago, there were stories all over about HOAs foreclosing on condos because of unpaid fees, and a recurring theme was the difficulty of foreclosing on foreign-owned condos because of service issues and other legal issues.

    Also, if you want to keep equating my discussion of “foreign buyers” with xenophobia, knock yourself out. Talking about the influence of foreign buyers on an r.e. market is not the same thing as being anti-immigrant, you troll.

  38. joe, you are getting testy in your miserable old age! the hoa foreclosing on condos due to unpaid fees was from buyers who were underwater and unwilling to sink another dime into a poor investment. i do not recall a “recurring theme” of foreign owned condos being the source of these problems in the media. it was probably just as big of a problem with the american group of homeowners. again, just show me an example where those foreigners led the charge in delinquency in brickell. should be easy since it was such a recurring theme. this was another urban myth. my old apartment went into default with the hoa-it’s owners were underwater americans.

  39. joe, vegas also has a “weak dollar” for foreign buyers, yet it is not selling like miami. it is not just the weak dollar. foreigners lagged for a while until the financial crisis stabilized, then they used the weak dollar to buy property in a growing urban environment. obviously they must have some criteria for buyer location, because they chose miami over vegas. and i don’t think they are buying for employment opportunities or civic engagement. they want waterfront access in an urban tropical climate. that is what miami always has and always will sell to the outsider. the weak dollar just makes the decision for them to buy easier.

  40. I don’t even understand what Joe is trying to argue anymore. A year ago you saw no end to the decline in values. Now you’re arguing that foreign buyers are only buying condos because of the weak dollar and ignoring the fact (as gables highlights) that if it was just the weak dollar they could be buying anywhere in the U.S. and yet the majority of the foreign money is pouring into Miami.

    I hate to tell you but real estate is a cyclical business. It booms and busts. This is going to continue to happen for various reasons. I’m sure 10 – 15 years from now we’ll bust again, and then another 10 – 15 years after that.

    You seem bent on pushing your ideology and not focusing on the market. I can see if you were arguing that values wont go up because there aren’t enough jobs. But now you seem to be arguing that values are going to go up with the jobs and therefore bust again so you shouldn’t buy because 10 years later there will be another bust.

  41. gables said: “again, just show me an example where those foreigners led the charge in delinquency in brickell.”

    – Where did I say foreigners “led the charge” in delinquency? I said some HOAs have had trouble with collecting fees in a timely fashion from foreign-owned condos, and that foreclosing on foreign-owned condos is often harder because of service issues and other legalities.

    ——

    gables said: “joe, vegas also has a “weak dollar” for foreign buyers, yet it is not selling like miami.”

    – Um, this is PRECISELY my point. Most people in Latin America couldn’t find Vegas on a map, so why the hell do you think foreigners would be buying there?

    ——

    Gixxer said: “and yet the majority of the foreign money is pouring into Miami.”

    – Really? A few days ago, you said Florida was getting 31% of foreign money. Since when is 31% a “majority” of anything? (And not all 31% is going to Miami.)

    • “Really? A few days ago, you said Florida was getting 31% of foreign money. Since when is 31% a “majority” of anything? (And not all 31% is going to Miami.)”

      You are an idiot. Last time I checked there are 50 states. Florida by itself gets 31% of the foreign money coming into the U.S. So the other 49 states have to split up the remaining 69%.

      Like I said, the next closest gets 12% and its the only other state in double digits.

      Florida 31%
      California 12%
      Texas 9%
      Arizona 6%
      Illinois 3%
      New York 3%
      Georgia 2%
      Hawaii 2%
      Nevada 2%
      New Jersey 2%
      North Carolina 2%
      Pennsylvania 2%
      Tennessee 2%
      Virginia 2%
      Washington 2%

      I’m pretty sure that 31% is the majority here.

        • You’re probably right. When I first came to this site I didn’t live here full time so the opposing dialogue challenged me to learn more about Miami. Now I live here full time and work in acquisitions and pretty much spend all day deciding what buildings my company buys and sells and finding investors to finance these deals. So now most things coming from Joe just seem absurd and have more to deal with ideology and not investment research.

          I probably should just ignore him, but we’ve been going at this for years now. I just think its funny to see his reactions as he becomes more wrong as time passes.

          Joe from about a year ago:

          “Again, as I’ve said many times before, I have no interest in living in downtown Miami, so I couldn’t care less what happens in that market. But when people roll onto this site and predict the current inventory will get absorbed in six months or a year, and even predict upward price pressure, I have to call B.S. As I said above, if there was sufficient demand in Miami for 30,000 new high-end condos, there wouldn’t have been a bubble in the first place.”

          But now only a year later the overall supply of all condos has gone from 16 months down to 7 months and there is upward price pressure on downtown condos.

          April 2010
          16,310 condos available
          995 average closings a month
          16,310/995 = 16.39 months supply

          May 2011
          10,597 condos available
          1,434 average closings a month
          10,597/1,434 = 6.99 months supply

    • joe, if the foreigners did not lead the charge, then why are you pointing them out specifically as a problem. there are much bigger fish to fry in any hoa issues. but you conveniently ignore those to point a finger at a few foreign incidents. you listen to rush way too much. you use innuendo and half truths to place the foreigners in a bad light, then play innocent. that game gets played on talk radio, but i will call you on it here. its the same game you played trying to blame things like the CRA for the financial crisis. total nonsense.

  42. Gixxer 1000 said: “I don’t even understand what Joe is trying to argue anymore. A year ago you saw no end to the decline in values. Now you’re arguing that foreign buyers …”

    – I’ve met a lot of dishonest people in my life, but you’re at the top of the list. I know you like to portray yourself as the big expert here, but my macro analysis has been far better than yours, and it’s all right here in black and white for people to see.

    Twelve to 18 months ago, when this debate got started, I said the only way Miami could pull out of the r.e. bust in a quick fashion was if foreign buyers started buying condos en masse. You, on the other hand, insisted that the bottom had occurred a year before it did, that the local market had changed, and that there was pent-up LOCAL demand for downtown housing, etc., etc., that would have the market booming again in no time.

    Now, looking back, who was right and who was wrong? Was it foreigners who pulled Miami’s r.e. market out of the gutter, or was it the locals you claimed would buy up the unsold downtown condos?

    (Remember all those long Gixxer 1000 posts about there being “300,000 professionals in Miami,” and families moving downtown, and “mothers pushing strollers,” and all that? Ha ha ha.)

    I’ve been wrong plenty of times in my life, and it’s never fun to admit it. But it’s outrageous for you to come here now and try to revise history, as if I was wrong and you were right. If you don’t even have the basic honesty and decency to accurately portray comments that are still on this site for all to see, then there’s no sense bothering with you anymore.

    • “(Remember all those long Gixxer 1000 posts about there being “300,000 professionals in Miami,” and families moving downtown, and “mothers pushing strollers,” and all that? Ha ha ha.)”

      How am I wrong. The number of strollers I see in Brickell seems grow each month. And the number of professionals seems to grow as well. I can tell you that job opportunities for me and the people I graduated with have been great. I had multiple job offers.

      Who the hell do you think is renting all these 1/1 at $1750 and 2/2 at $2,200???

      There are 2.5M people in the Miami metro area. 300,000 is only 12% of that population. If you don’t think that 12% of the people living in Miami have a professional job you delusional. There are close to 200,000 professional jobs in the Downtown area alone.

  43. So my lease is up in a month and I find out that my unit is now renting for $250 more a month than what I rented at a year ago. Considering it will cost a considerable amount of money if I move out I’m trying to negotiate only a $100 a month increase.

    I remember about a year ago everyone was talking about all the empty rentals and how they were sitting empty for hundreds of days. Now units are renting in a month for hundreds of dollars more.

    In my building the average price per square foot has gone from $213 in 2009 to $245 now in $2011. 2009 was clearly the best time to buy in my building. The average 2/2 is about $40k more. Saving $200 a month for a year or two at most saved the average renter at most about $5k, a far cry from the $40k more they have to pay today.

    Due to the fact that I had to quit to go to school full time and had to put a lot of money into my $60k tuition I wasn’t in a position to buy. I really wish I would had though. I could have locked in a monthly payment with HOA and taxes at about $2,500 before you factor in taxes which would result to about $2,150 after taxes. 2/2 are already renting above that at about $2,200 and going up by a least 5% each year for the foreseeable future.

    • Gixxer, you weren’t in a position to buy 2 years ago so don’t beat up yourself over that. The good thing is that interest rates are still low today. There were many people touting saving a few hundred dollars in rent/month two years ago and didn’t take the opportunity to lock in their rent for forever by buying at distressed levels. Today these folks are facing the same problem you are and could be priced out of the downtown market in a few years. They may be relegated to moving out to a rat infested apartment in Hialeia in just a few short years as rental rates continue to climb.

      p.s. no offense to hialeia residents

      • New construction is unlikely to let this happen. Downtown (especially Brickell) has grown into an extremely desirable neighborhood. As the prices continue to rise developers will begin to build more rental buildings to take advantage of this growing demand. One area to be on the lookout for is west of the metrorail in Brickell. This area is less developed but is still only a block away from Mary Brickell Village. Developers can build there and forgo the luxury features and make a profit renting at more moderate prices. Another option is to renovate some of the existing buildings that are renting in the $600 – $800 range and increase rents to about $1200.

        This will allow the area to continue to grow. I agree the days of paying $1350 for a luxury unit are gone, but now the draw to the area is the area itself and not the luxury units.

    • That’s a pretty interesting chart on foreign Trulia searches. Funny that 3 of the top 10 UK searches are central Fla (Orlando, Kissimmee, Daveport)…why would snooty Brits be drawn to a tacky and cultural wasteland like central Fla? I guess they like theme parks.

  44. Gixxer – Thanks for admitting that you don’t know what a simple word like “majority” means. I find it harder and harder to believe you were accepted at Ivy League schools, as you claimed 1-2 years ago.

    Anyway, your continued deceit is really amazing. 1-2 years ago, you claimed local buyers would have the market booming again in no time, while I said the market’s only hope would be foreign buyers. It’s really astonishing to me that, on an ANONYMOUS internet site, you don’t have the basic honesty and integrity to admit I was right and you were wrong.

    • Wait, when we were arguing about the bottom, you were cherry-picking zip codes in Brickell and using only those. Now you’re back to caring about the entire Miami-Dade market?

      (And that whopping 0.6% increase in So. Fla. r.e. prices in the midst of a foreclosure backlog is hardly praiseworthy. The shadow inventory in So. Fla. is still huge.)

      • Actually the downtown zip codes that I have been “cherry picking” are posting 19% – 37% gains. Those increase are now enough that the overall average is flat instead of down. But I’m not arguing that all of Miami-Dade is up again. There are a lot of less desirable areas that are going to hurt for a long time.

        It just proves my point that that looking at Miami-Dade as a whole can be pretty deceiving when some areas are posting 30% declines while others are posting 30% increases. It would be like averaging Manhattan, NY and Hoboken, NJ because they are close together. And as I’ve admitted that was my mistake when I started looking at Miami before I moved here. East of I-95 is a completely different market.

        And I see you’re back to your shadow inventory argument again. I remember a while back when you were predicting that this same shadow inventory would keep prices from rising, but yet here were are.

        The inventory of condos in Miami-Dade has dropped from above 15,000 six months ago down to 10,600 in May. All the while Pending sales have been going higher and there is pretty much no new inventory for years.

        Then on top of that you have to look and see where the majority of the shadow inventory is. As of December 2010 preforeclosure filings had dropped to below 50 and there were only about 20 auctions a month for ALL of downtown.

  45. Will opening a casino attract the wrong crowd? possibly. But in Vegas, There are a number of hotels which also act as the destination. If miami wants to be the adult playground of the east coast, it’s going to need more casinos

  46. Gixxer said: “Then on top of that you have to look and see where the majority of the shadow inventory is. As of December 2010 preforeclosure filings had dropped to below 50 and there were only about 20 auctions a month for ALL of downtown.”

    – This is true, but it’s not because things are looking up for mortgage-holders; it’s because the courts are so backlogged that they can’t handle more foreclosures right now. I saw a segment on TV that said, at the current pace, some states would require FORTY YEARS to process every delinquent mortgage via the state’s normal foreclosure process. Obviously, banks are increasingly trying to do short sales, etc., but there’s still a huge backlog of delinquencies.

    • I agree that there are a lot of reasons for the slowdown in foreclosures. Another issue is was the foreclosure freeze due to moratorium on foreclosures because the banks failed to prove they owned the mortgages.

      But its pretty much impossible to figure out the status of mortgages by neighborhoods, you can only look to see how many auctions there are. How ever most reports I have read indicated downtown will be less affected due to the large percentage of cash buyers in the last few years.

      As far as the “TV segment” that you saw, even if it were to take 40 years…. who cares. That pretty much goes against your theory that this shadow supply will somehow suppress prices. When a buyer is looking to buy they are not going to be affected by supply that will slowly trickle out over the next 40 years. The price when they buy will be affected by the price/demand/supply when they buy.

      As of June were down to 10,076 condos available in all of Dade county. Multi-family starts are at record lows. There pretty much isn’t anything under construction right now. So basically were at about 7 months of supply with no new inventory coming for a couple of years besides resales and REO’s that you now are saying is going to trickle out over 40 years.

  47. http://www.miamitodaynews.com/news/110714/story1.shtml

    “Miami-Dade’s housing inventory is dwindling as internationals continue a buying frenzy for real estate at discounted prices, reflecting a more balanced market with six months of housing supply.”

    “If sales stay at the current pace, the existing inventory would be absorbed by year’s end, making the question of how much inventory is coming down the pipeline key to forecasting what’s ahead for the local housing market.”

    “The unknown is what will happen with the distressed properties in the pipeline, including when they will get released to the market for sale, as that could significantly impact Miami’s housing recovery.”

    The article talks about how there are 150 units left at Mint which just began sales in January. 50 units left at Infinity which began sales about a year ago. Most international sales are in the $300k – $400k price range. It’s seems pretty clear that the majority of the sales are downtown.

    So if prices and sales are going up downtown and prices and sales are going down in the suburbs I think its clear which areas are going to be affected more by foreclosures.

  48. Gixxer — I agree the foreclosure backlog isn’t likely to impact Brickell/downtown, per se. All of our various catfights aside, I simply see the market a little differently than you in a more fundamental way — i.e., I believe the r.e. crash put the lie to the idea that “all r.e. is local.” I don’t have any doubt that some people are making good buys downtown and making some money in a micro sense. But when I look at the basic fundamentals of the U.S. economy, it’s hard for me to be bullish, at least for the next few years. I don’t believe Brickell buyers are going to lose their shirts, but it’s hard for me to look at 2014 and see major appreciation. I suppose there could be a steady stream of international buyers for several more years, but remember, even with highly discounted prices from the bubble’s peak and a huge wave of int’l buyers, it’s still taking months or years for buildings to sell out — buildings that often sold out in hours or days in the pre-construction era.

    • Wait a minute, did I miss the $75/sf fire sale I was promised?

      Looks like prices for rentals are heading back up due to a lack of supply.
      where are all those folks who advocate renting is better than buying when prices waere at the rock bottom. Oh well guess they will wait till the peak of the next boom to finally decide to buy a place.

      http://www.miamitodaynews.com/news/110728/story6.shtml

  49. I like the Continuum complex, but paying $1,200 per square foot for a non-ocean view PLUS $2,500 or more per month in HOA fees? No, thanks.

    Anyway, I’m not sure that these sales prove anything. High-end beach properties are still selling at a glacial pace. People aren’t buying $5 million second homes, and there’s almost no market for $10,000 per month rentals. This is why downtown sales are brisk while beach sales are slow.

    • That’s funny:

      Quotes from a recent article by The Real Deal:

      “One geographic area that has been particularly strong in the higher end is Miami Beach, which has seen a slew of ultra-high-end home sales”

      “What I’m seeing is that the high-end houses are selling, and the market is not replenishing itself with more very high-end houses,” said Nelson Gonzalez, senior vice president at Esslinger-Wooten-Maxwell. “The market is starting to get really, really tightened up. Some people are even raising their prices.”

      “High-end condo sales in Miami Beach were strong, too, he said, with a host of condos fetching more than $1,000 per square foot, something unseen since 2005. It’s all part of a general price jump in the high-end sector.”

      So you say high-end beach properties are moving at a “glacial Place” but the VP at EWM with the actual sales data says sales of high-end beach condos are strong.

  50. Another quote from the article:

    “You can’t believe the macro reports that say pricing is down in South Florida,” she said, “because it’s not that pricing is down. It’s that one particular segment of the market is down because we’re flushing these [distressed] properties out of the system.”

    Sound familiar?

  51. Gixxer — Putting aside your weird obsession with replying to every single comment I make here, do you ever stop and think before clicking the “submit comment” button?

    Barely a month ago, you collected and posted numbers here that showed Miami Beach to have roughly 300 percent more inventory than downtown in terms of the monthly sales rate, and yet now you believe some Realtard who claims the Beach market has “really tightened up.” Give us a break. These are the same clowns who told us there was no bubble 3 years ago. If high-end properties were truly flying off the MLS, then why is 20 to 25 percent of Continuum still available some 3 years after it opened? (Don’t believe the 15 percent number in the article; I know for a fact that a large number of units are shadow inventory.)

  52. That’s funny when I’m the one who posted here today and you have been clearly respond to me. Not to mention within this thread you have step by step responses to me and other where you copy and replied to my comments. Pot meet kettle. The only difference is that I’m not hypocritically calling your responding to me weird.

    And what are you talking about I’ve never posted downtown numbers. I posted Miami-Dade as a whole and then broke out Miami Beach.

    Miami-Dade
    Total 10597/1513/7
    under $200k 4337/1111/4
    $200k-$300k 1728/151/11
    $300-$400 1170/76/16
    $400-$500 782/40/19
    $500-$750 1018/54/19
    $750+ 1562/82/19

    Miami Beach
    Total 1696/206/8
    Under $200 423/99/4
    $200k-$300k 292/28/10
    $300-$400 248/20/12
    $400-$500 149/12/13
    $500-$750 216/19/12
    $750+ 378/28/13

    Miami Dade has about 7 months of supply and Miami Beach has 8. And when you go to the $750k+ Miami Beach has fewer months of supply.

    It’s funny how you don’t believe anything you don’t want to hear. If these same Realtors were saying that sales are stagnant and prices are still going down you believe them then.

  53. Gixxer — I go days and sometimes weeks without visiting this site. If you’re trying to claim I post more than you, or that I’ve replied to a higher percentage of your posts than you have to mine, you’re nuts.

    Anyway, it was barely a month ago that we were talking about how Miami Beach had something like 3 times more inventory than downtown, and now you’re claiming the opposite. I find it hard to believe the Beach market has turned around that much in one month.

    • Gixx,
      you are debating right wing repubtards. Quoting Facts and figures are useless to them, you might as well write gibberish, they just won’t get it. If you really would like to communicate start talking about how things feel or looks. Say something like “I feel the Miami condo market is starting to stabilize but because Miami is a third world cesspool of crime, corruption and illegals the market will decline another 30% by next summer.” Then you will be talking their language.

      ps no offense to my repubtard friends out the, just having some fun. What is with this board. Why hasn’t anything been updated here in a while, I thought Lucas was going to dominate the RE Market in Miami whith is website?

      • Do you really think this nonsense advances the dialogue in any meaningful way?

        The entire point of my comment is that the “facts and figures” couldn’t possibly have changed so much in one month, from Gixxer telling us downtown was massively outperforming the Beach (June 2011) to now claiming the Beach and downtown markets are almost indistinguishable in terms of inventory.

        Last month, Gixxer’s own chart showed the Beach to have something like 3-plus years of inventory in the highest-priced segments, and now he tells us it’s only a 13-month supply. Either one of his two charts was way off or he’s cherry-picking numbers again, as has been his tendency (e.g., the market bottom, downtown prices, etc.).

        • What are you talking about??? I just posted the numbers I posted a month ago. Here is your response to my numbers:

          “His own damn chart, above, shows 4 months of supply in the bargain-basement “under $200k” segment but then 11, 16, 19, 19, and 19 months of supply in Miami and 10, 12, 13, 12, and 13 months in Miami Beach.”

          So a month ago I posted numbers showing there was 13 months of supply in the highest priced segment in Miami Beach. Please show me where in June I posted that there was a 36+ months of supply.

          My numbers are there for everyone to see posted June 13, 2011 at 6:21pm.

  54. Joe says “I like the Continuum complex, but paying $1,200 per square foot for a non-ocean view PLUS $2,500 or more per month in HOA fees? No, thanks.”
    Another reason why we all know Joe knows nothing about Miami but would like like us to believe otherwise.
    Joe, FYI, Continuum Complex is right on the beach. Almost all units in both North and South tower have Ocean View. I suggest you visit Miami and familiarize yourself with this town before you talk about it so authoritatively.

    • Dear “imo” — Please get yourself a clue before you pop off. I lived in Miami for years and I’ve been at the Continuum site (or next door at Nikki Beach) more times than I can count. In Continuum North, the “1″ line is the best, with 2, 3, and 4 also having direct water views. Some of the other lines (5, 6, 7, 8) also have an ocean view, but, if so, it’s generally from a balcony or an obstructed view (or a view of neighboring buildings). If you check the recent sales, most of them have been on the “back” side of Continuum, hence my comments above.

      • The site I use for recent sales just added several for Continuum in June and July, which I assume includes the ones mentioned by Gixxer’s article. I’m not sure which ones were the specific five mentioned in the article, but the latest sales, by line, have been:

        4, 6, 5, 2, 6, 2, 11, 1.

        Unless I’m remembering it wrong, the 5 line essentially faces Continuum South, and the 6 line is aimed directly at inland SoFi. No doubt the units are nice, but I stick by my comments above re: pricing and HOA fees.

      • All that info is public records and the geographic orientation of the building can be found on Google maps satellite imagery. So you dug up the info in 3 days and posted here. I am still not convinced you know what you are talking about. Most lines in these buildings have ocean view and need not come into the balcony for that.

        • “imo” — I’m not sure what to tell you. I lived in Miami for years. Why would I post here if I hadn’t lived in Miami and/or didn’t have an interest in returning to Miami? It makes no sense. I’ve posted here for 2 years or more and no one has ever doubted that I’ve spent a lot of time in Miami. Hell, even Gixxer had to admit I was right about traffic, etc., when he was in the process of moving to Miami a year or so ago.

  55. More info about Genting and their plans for the site:

    Some ideas currently in the works for Resorts World Miami:

    • At least four hotels from different brands targeting travelers across the lodging spectrum: luxury, mass market and boutique. As in Las Vegas, two different brands could be in the same tower, along with residential condominiums.

    • Two levels of underground parking that would allow drivers to maneuver around the site without placing extra traffic on already congested streets. This is similar to what Arquitectonica has designed for Swire’s Brickell CitiCentre.

    • At least two dozen restaurants, clustered in two main areas: overlooking Biscayne Bay and along Biscayne Boulevard.

    • The Boulevard Shops will be preserved, restored and incorporated into the design. They will likely be used for restaurants, a bar and shops.

    Read more: http://www.miamiherald.com/2011/07/30/v-print/2338354/genting-plans-to-bring-life-to.html#ixzz1Ti4KlZbo

  56. Another interesting article:

    “I think the potential for the market turning around in Miami is better than anywhere else in the United States.”

    Analysts say Genting’s approach has merit for a newcomer trying to break into the market. By setting up shop in New York and Miami, Genting can build a base of clients that already travels between the two destinations regularly. Capitalizing on the allure that exists for South Beach and Miami’s warm winter weather, Resorts World Miami could become an attractive weekend getaway for anyone in the Northeast.

    “If you set it up properly, you could have a destination that really attracts a customer that wants a Vegas experience but wants the ability to get there easier,” said Brian McGill, gaming and lodging analyst with Janney Capital Markets. “Miami in itself is already an attractive destination; you’re just going to heighten that. You could easily take a potential trip away from Vegas. Rather than flying five hours to Vegas, I can get to Miami in two hours.”

    Read more: http://www.miamiherald.com/2011/07/31/v-print/2338880/genting-group-is-betting-on-miami.html#ixzz1TpH8FlMR

  57. “I lived in Miami for years and I’ve been at the Continuum site (or next door at Nikki Beach) more times than I can count.”

    - I can envision old man Joe in his white linens sipping champagne in a teepee at Nikki Beach, blabbering to disinterested European women about his doomsday Miami condo prophesies…

  58. ====Infinity at Brickell had it’s first condo resale…. I sold my condo that I bought in Infinity back at the end of 2009=====

    —> sold it to a cash buyer for 97% of my asking price the first week it was on the market

    —> sold it for 45% more than I paid for it 1.5 years ago

    —> sold it for over $100 per foot more then I paid for it, which i understand is the highest price per square foot ever sold in Infinity

    —> with the profit I made from selling my Infinity condo I bought a very nice condo for CASH in boca raton in a nice/quiet upscale area- no more mortgages for me

    —> interesting …. since 2009 these boca condos have dropped in price by 25% while my Infinity condo went up in price 45% …

    —> the boca condo is much quieter then Infinity. It doesn’t allow pets and has very strict limits on renters, majority of folks in theses condos are owners and many of these condos are 2nd homes only used in the winter

    —-> I bought my infinity condo to be my perm home, however it turned out to be a great investment. Selling it enabled me to cash out and buy my nice quiet boca condo for cash, so I am happy.

    —-> I wish all of you good luck with your future Miami condo purchases. HAPPY blogging!

  59. Owner at Infinity, Congrats on your profit booking and your new home purchase. Good insight for the past couple of years. We are going to miss you here. Happy living in Boca even thoug it is not for me.

  60. Owner, congrats dude, I am happy for you. You took a leap of faith and it paid out nicely. Most importantaly you took that leap when most people were crying “the sky is falling, the sky is falling”. I know it wasnt easy but you my friend was able to recognize a bargain. Like I’ve said some people make things happen and others well… Anyway, you did alright at catching falling knives, lol. I hope you will continue to chime in every now and again. I wonder how DJ is doing with his purchase.

    • thanks man for your kind words and you were right I was scared at first when i first bought my infinity condo, i thought maybe the prices in Infinity may continue to drop however i saw the great value it was and took the risk and it paid off very well.

      I never thought when I first bought the place that it would go up in price so quickly. I thought it would take 5 years or so to go up 45%. I guess I was at the right place at the time and now thanks to infinity I get to live in a paid off condo in an area that is better for me in the long term.

      Plus as a bonus, my new boca condo is a bit closer to the ocean then Infinity, so I now have a shorter bike ride to the beach. Boca/Highland beach is very very nice (and clean)

      This is the 5th place I have owned and I have made money on all of them when I sold them.

      I am very happy I took the gamble and I am still amazed I rec’d such a windfall in such a short period of time. Now I am living 100% debt free. It is a great feeling!

      • owner — Congrats on the sale and profit. Couple questions:

        1. Aside from the profit motive possibly pushing you to sell, was the rental situation really that bad at Infinity? I recall you were happy when you first moved in, but then you were unhappy almost as soon as the first renters moved onto your floor. I’ve taken a lot of heat here for talking about condo life when it comes to renters vs. owners, but it seems like your comments and move at least partly validate what I’ve been saying. (When you moved into Infinity, you made it sound like that would be your home base for a long time, so the quick move is interesting, even with the profit factored in.)

        2. Unless the tax laws have changed, wouldn’t you have done better by waiting another few months so you could have sold at the 2-year mark? If you truly sold at the 1.5-year mark, it seems like you’re going to take a big tax hit. I’m curious about your strategy here.

        Again, congrats. Hope you enjoy Boca.

        • Joe,

          1a. Aside from the profit motive possibly pushing you to sell, was the rental situation really that bad at Infinity?

          —-> Infinity has the same type of rental situation as in any of the new large middle of the road condo buildings in Brickell. Most Y gens renters would not have an issue living with yahoo renters in these buildings and they would say that Infinity actual has a better group of renters then other Miami condo buildings. So NO the renters at Infinity are not that bad to most people. Especially to folks that are used to renting in apts buildings…… However I am X gen that is used to living in upscale single family homes with like minded very stable folks living in the homes around me.

          – problem was not that the renters at Infinity or the renters at the other middle of the road Brickell buildings, the problem was my standards were too high. For the 100s of thousands of dollars it cost to buy a place on the 50/51 floor I expected I better class of people living on my floor. Never did I expect so many disrespectful yahoo renters to move into my floor.. Most people would just say that this is normal for a high raise miami condo building and that I would need to accept it.

          — Having a very cool and a very affordable place on a very high floor in Infinity with an amazing east view was not worth the money when you know the majority of the units are rented (just like all the other middle of road condo buildings in Brickell) and at any moment an new disrespectfully yahoo renter can move into the unit next to you. I want more stably then that in where I live and my community in boca provides that to me. I don’t want to live in a Hotel. I want a home not a Hotel Suite. These yahoo renters have no respect for the folks that live around them, cause they see their condo as just a temp place to live and not as a home as I did. Also, I notice that these young yahoo renters had a sense of entitlement that I feel they didn’t earn. NOTE not all the renters were yahoos, however I had more then my share on my floor. These yahoos renters are the classless renters that you would expect to find in cheaper buildings in less desirable areas in Maimi. I guess I expected a better class of people to live with for the money if costs to buy a condo on my high floor. But that is what happens when mostly investors buy the condos and rent them out. If there were mostly owners living on my floor then I don’t think there would be so many yahoos, cause the condos would be the owners home and not a temp place. The owners will have more skin in the game.

          1b. I recall you were happy when you first moved in, but then you were unhappy almost as soon as the first renters moved onto your floor.
          - Yes and Yes.

          1c. I’ve taken a lot of heat here for talking about condo life when it comes to renters vs. owners, but it seems like your comments and move at least partly validate what I’ve been saying. (When you moved into Infinity, you made it sound like that would be your home base for a long time, so the quick move is interesting, even with the profit factored in.)
          - Yes I planned it to be my long term home and Yes the yahoo renters started me to 2nd guess that decision. Plus I was getting tried of dealing with the lift as folks started to move in…. it took longer and longer to get my floor. A negative for living at the top of the building. But finding out that it went up so much in value is what pushed me over the fence to sell it.

          2. Unless the tax laws have changed, wouldn’t you have done better by waiting another few months so you could have sold at the 2-year mark? If you truly sold at the 1.5-year mark, it seems like you’re going to take a big tax hit. I’m curious about your strategy here.

          - I talked my accountant before I sold it, there are exceptions to the 2 year rule that I can use and I will not have to pay any capital gain taxes. I reviewed the rule with him and it will not effect me. So, selling it within the 2 year period will not be a problem. Just FYI I always double check tax related items before I act. I don’t make rash decisions. But that is a good question

          - I know you are curious on why I sold my place so suddenly…well let me explain my strategy and why I sold it in more detail.

          - First, it was not due to an affordable issue, as I mentioned before my Infinity condo was very affordable. I bought it very cheap and I put down a good down payment and had a 5% interest year rate for 30 years, plus my taxes were low due to homesteading it since it was my perm home and my maint fee was very low due to the fact that the developer/investor was still in control of the building and therefore the maint fees were lower then they will be once they turn the building over to the HOA. Therefore my total monthly out lay (mortgage, maint and property taxes) were much lower then what it would cost me to rent my condo.

          - Why did I sell it? There are many factors, including the ones I mentioned above (yahoo renters, waiting for the lift and the fact it went up 45%). But I think the main reason to wanted to sell it quickly was the fact that the US and EU economies are NOT getting better and in fact they are getting worst.

          – I have been managing national and international projects for corporations, banks and financial houses for over 15 years and during that time I learned how business, financial markets and economies work. Today’s economic conditions are the worst I have ever seen. My gut is telling me that within the next couple of years something very bad will happen to the US and world economies. So bad that it will make the 2008 financial crash look like a walk in the park. This bad thing could happen much sooner.

          – Currently the housing market is having issues and a rebound will take a very long time for many areas in the US. Yes, I know there are some areas of the US that are doing well. Brickell being one of them, thanks to our rich south American investors friends. However I believe when this bad thing happens it will negatively effect most RE markets including condos in Brickell. I see another big drop in RE coming when this happens.

          – Therefore, I wanted to sell my infinity condo as quick as I could this year just in case this bad thing happens this year. I know if I waited another year I could of gotten another $15K more for my Infinity condo, however I am saving $15K per year in carrying costs since I paid cash for my boca condo and my boca condo’s property taxes are much lower.

          – Therefore I saw no reason to wait to sell infinity. I didn’t want something bad to happen soon and the Miami RE market drops suddenly and I lose a big hunk of my equity that I had in my Infinity Condo. I thought it would be best to get out and cash out while the getting is good. Better to be safe then sorry. I don’t like to be caught with my financial panties down.

          – So I spent 6 months starting in Jan looking for the best condo value for least amount of money in the best area in south florida on the east coast closest to the beach. Which I found in the Boca condo I bought.

          – Now that I am debt free and I am living very very cheap I am ready for the financial storm that is coming. I always hope for the best but I plan for the worst. If RE prices drop it will not be a big deal for me since I did not pay much my Boca condo and I have no mortgage. I feel much more free this way and will not be trapped with a mortgage when the SHTF

          - There is also another reason I sold my Infinity condo. I plan to phase out my corporate career in the next few of years, I have out grown it. The only good thing about it is that it is a great way to make good money quickly. I want do other intellectual things with my life that does not generate a large income, therefore this is another reason I want to live cheaply,not have a mortgage and lower my monthly nut. Also I plan in the next couple of years to buy a few inexpensive rental properties so I can generate so passive income.

  61. Owner, thanks for the insight.
    First of all I don’t believe you should make investment decisions base on fear. Unles you have a track record of predicting shuch events. I have a few questions though. If you believe there is a global financial disaster on the horizon why did you decide to pay cash for a condo when you could have financed at an effective rate at about 2% (assuming 15year term and intrest deduction)? If you put a decent down payment and financed the rest at current rates you would have a lot of money to save or invest in gold or rice and beans or whatever would be valuable in this impending dooms day event. I’m sure you realize a condo in SF will probably take a significant hit should this event come to pass.

    just wanted your insight on that.

    • 1. I don’t make investment decisions base on fear. I use 100% logic. I base them on my years of experience and my research and thus far I have never been wrong. And even if that bad thing doesn’t happen and RE doesn’t drop a lot due to the fall of the US and world economies, I was done with Miami and Infinity and wanted to live cheaper for other reason that I already mentioned and I wanted a more stable area with more respectfully folks living around me. Also my home is not an investment, it just happened that Infinity became an investment for me.

      2. I paid very little for my place in boca compared to what I sold Infinity for so little that I have the same amount left over after buying the boca condo. So I have plenty of extra left over to weather the coming storm.

      3. Even if I would of gotten a 15 year fixed loan for my boca place, at a very low interest rate and with 20% down I would being paying $20,000 over the life of the 15 year loan for interest charges. Since I plan to stay in the boca condo for a very long time (over 15 years and I will most likely retire in it) it doesn’t make sense to spend $20,000 on interest over the 15 years when I have plenty of money to paid cash for it today.

      4. Debt = Slavery – When folks get mortgages it allow banks to lend up to 90% of that mortgage amount to others through fractional reserve lending. This is our debt based money creation system that allows banks to create money of the thin air and lend it as long as they keep a 10% cash reserve in their bank. I don’t want to be part of this debt based money creation system anymore. Why should I help the banks create more money out of thin air and charge interest on it, when I have plenty of money to pay cash for the condo. Banks want housing prices to be high that way the average person is forced to get a mortgage loan in order to live in a decent home. That way banks get to charge interest on that loan, plus they get to create more money out of thin air when they make more loans from your loan and then charge interest on those new loans. It’s a big scan. I would rather live in my less expensive but still very nice condo in boca that I paid cash for then help the banks create more money out of thin air.

      5. Like I already mentioned I had a lot left over after buying my boca place. Plus I have already bought a lot of PM (gold and silver) a while ago when prices were lower and I already have plenty of extra food stocks that will last a long while, so I am well prepared for the coming storm. The only thing I had left to do is to reduce my expenses to the bear bones, which I did my selling my Infinity condo and taking the profit and buying my boca condo for cash. Now I am fully prepared and even if I did not think this bad financial thing was going to happen I still would of done the same thing, sell infinity and buy the place in boca for cash. I like living cheap, it allows me not to work so much and it makes me feel very free. I love not being a Debt Slave. It’s not like I gave up a lot, I still live in a very nice place that I have updated to meet my standards. Actual I think my new boca place is nicer then my Infinity place on the inside.

      6. Yes, like I already said in my last post SF RE will take a significant hit should this bad thing happen with the US and world economics. However like I already said in my last post I would rather be living with no mortgage then living with a mortgage if this happens. Because if I had a mortgage and this bad thing happens and my boca condo drops 25% I would be upside down on my mortgage. That would be unacceptable and something I have never experienced before. If prices drop 25% on my boca condo, so what? I paid cash for it and have no mortgage so I am not trapped, it will always to worth something and I would always be able to sell it for some price if I had to. However it’s my long term home and if doesn’t matter if the price drops, I am not leaving South Florida and it was the best value in Eastern SF. If my boca condo price drops my property taxes will drop which will reduce my carrying costs (my nut). Plus I got live somewhere and GODs know I am not a renter.

      7. Here is another advantage of living very cheap. The 1st of the year I have to drag my butt back to corporate America and get another project to manage. But since I am living so very cheap, I can save A LOT of money while I am managing these projects, after paying my bills and expenses I can save at least $60K-$70K per year. Which I plan to buy an inexpensive condo for cash in SF and rent it out for passive income. If I can get a few good projects in the next few years I will buy a few rental properties for cash. Plus I feel in the next few years my PM (gold and silver) will go up a lot more. And when that happens I plan to sell them and buy more inexpensive rental properties. There are some great tax advantages and write offs with these rental properties that will help me to reduce my taxable income. Since I am independent consultant, I am already taking advantage of some good tax write offs on my expenses when I work out of town. I have learned a long time ago it is not what you make it is what you have left over after you pay your taxes. So I like doing income producing things that allow good tax write offs. My goal is to live a good lifestyle but not work so much. And having very low expenses helps me to achieve that goal.

  62. owner, congrats on the new pad. sounds like you made the wise choice that let’s you sleep at night. i agree, debt can be very debilitating, thus i try to avoid as well. condo living obviously was not for you. your experience may be the same as many of the retiring baby boomers who will flood the urban market as gixxer has mentioned. urban townhomes would be better than condo high rises for them-and you. the culture clashes which may occur in a high rise could be an issue. i mentioned a few years ago on this blog that NYC style co-ops would be nice in miami because of the greater control of owners and residents. noboby agreed with me at the time. but unless you get a very well managed building (ie very strict) the culture clashes may become a problem.

    • While I have been talking about baby boomers moving back to urban areas I’m not really talking about downtown. I’m talking more about a baby boomer moving from a large single family home in say Kendall to a condo in a neigborhood that fits their needs like Coral Gables or in this case Boca Raton.

      Boomers have no real need to move to downtowns. Downtown’s usually charge a premium because of the close proximity to professional jobs. A retired boomer has no incentive to pay that premium.

      I think alot of times when people hear urban they automatically think downtown.

      NYC (and the co-ops) are different in that essentially the majority of NYC IS downtown. They don’t have options like Coral Gables, Coconut Grove, etc.

  63. Owner, regarding the “yahoo” renters, you probably jumped the gun on that one. many posters have warned for the past 3 years, that the days of subsidized renting in downtown will be coming to an end sooner or later. The “Yahoo” renters were a necessary evil from 2008 to 2011. These people got subsidized rents by the landlords just to fill those units and keep the cash flowing. Now the rents are creeping up from $100 to $500 per unit and are becoming anaffordable for these “yahoo” renters. It is becoming a LandLord market once again. College students and waiters doubling up and tripling up to rent these luxury units are either over or almost over. So in the next 2 years, these will be occupied by more professional renters and more owners who will be more attracted to downtown due to the explosive growth of amenities. One day you (or children) may look back and regret the sale of that penthouse you had at infinity but for now, enjoy Boca Raton. It is a nice place to retire, No Doubt.

    • Owner’s problem wasn’t really yahoo renters but simply was suited towards living downtown. I’m a professional in my early 30′s and he probably wouldn’t have like me as a neighbor either. Then when you add in the noise from the nearby bars and restaurants it just wasn’t the right environment for someone with his lifestyle.

      I can see how if you don’t often use the ammenities of downtown then putting up with the negatives could get tiresome.

      Congrats Owner!

      • thanks guys for the comments, and Just FYI I am no way close to retirement age. I am still on the sunny side of 40 and I have no kids, I just don’t like living with yahoos when I pay so much for a place.

        I loved living downtown, however to live there the rest of my life I would of had to buy a condo in a much better and peaceful building like the santa maria that is in south brickell. I am sure I would be very happy there. But that type of building is WAY out of my price range.

        I never lived in a cool high raise before and wanted to live in one and I wanted a very high floor with a hell of view. I got what I wanted and I am happy I brought the place. But a middle of road building like Infinity is not the place in live long term. I like to live in the same place for a very long time. Moving is a bitch!

        I am much more happy that it went up in value so quickly that I could use the profit to buy my boca place for cash.

  64. owner, i like coral gables over brickell for the same reasons. did you buy into a multistory building in boca, or is it a townhome type development?

    • It’s not a Townhouse….they call it a single level villa with 2beds and 2 full baths.

      It is in a 2 story building with 12 units in total. 6 units upstairs and 6 units downstairs. Each unit is stagger so your bedrooms are on outside walls so you don’t have anyone living on the other side your bedrooms walls.

      I did not want a multistory building again, too many peolpe and noise. It’s very quiet, (death quiet) the only noise I heard is when the lawn men are cutting the lawn. There is a lot of grass in Boca. But that is only once a week.

      Over half the units in my building are owned my folks that use their units only in the winter, so it’s like I live alone in the building. I like that.

      My place is on the 2nd floor (with no one above me). What makes it unique is that since it’s on the 2nd floor it has a high vaulted ceiling over the kitchen, dining and living rooms, which makes it look very open and modern.

      I have my own staircase on the outside to my 2nd floor unit, so I have a private entrance. So I don’t hear folks coming and going in other units like I did in Infinity.

      Also the high ceiling makes it look like you are actually living in a single family house rather then a condo. My patio facing a nice green belt and you can see a golf course in distant. Lots of golf courses in Boca.

      It was build in the late 1980s, and my seller owned if for over 20 years and only used it in the winter, so it was in mint condition, however it had the “golden girls” decor going on, so I just finished updating the place to look as modern as my Infinity unit did. Actually I think it looks better then my Infinity unit.

      I didn’t spend that much for the updates, because I did a lot of the updates myself and due to the economy I was able to have the work that I could not do be done cheaply by professional workers.

      I got the most bang for the buck with my updating and I did not over improve the unit. So if I had to sell it today, I could sell it for what I paid for it, plus the cost of updating it.

      I didn’t mind that it needed updating…..I rather do my own updating so I have place the way I want it.

  65. a big gripe i have with the multifamily housing units (condo or apartments) is the lack of sound insulation provided into the buildings. soundproofing, while not free, can be done without significant cost increases, and yet even in many newer buildings it does not occur. noise from the hallways can be severely limited with fitted doors. yet almost all buildings have gaps under the door and uninsulated doors. soundproofing material under the floors (emerald requires this) and proper construction material between units would also help at minimal cost increase. gixxer, when you develop in the future, dont skimp on soundproofing!

    • i totaling agree – hearing others in the main reason I don’t like living in condos. Buildings like Infinity with a central inside hall get ALOT of noise in the hall.

      I have been spoiled living in houses all my life, they have no common walls and no central inside halls. I liked living in houses, however I don’t want the responsible nor the high carrying costs any longer. My transition from living in a house to a condo has been tough at times. But they are ALOT cheaper to live in then houses and I think my new place will be as quiet as a condo can be. At least it has been so far.

      • Congratulations to you for having the gumption to buy into the miami condo market when you did and for being able turn it around for a nice profit.

        Have lived in hirise full service condo buildings in miami for years -wiht all the plusses and minuses-and now pay about 57 cents per sq ft per month in maintenance fee.

        Apparently you did lots of due diligence on the boca market.

        What sort of mntnc fee do you pay when you leave the confines of a large multi unit condo and move into a smaller 12 unit building?

        How do owners handle repairs to the common building elements and to their own units?
        Because you are a knowledgeable young and year round resident I bet the part timers would love to have you on the BOD to oversee their interests especially when they are away for summer .

        • george said.,

          Congratulations to you for having the gumption to buy into the miami condo market when you did and for being able turn it around for a nice profit.
          ===> thank you, I was very luckly

          What sort of mntnc fee do you pay when you leave the confines of a large multi unit condo and move into a smaller 12 unit building?

          ===> there are 10 or so buildings in the community with each having 12 units. The maintenance fee is 29 cent per square foot. There is a community pool, however that is it. It’s not a full service building like Infinity. I did not want another full service building because I noticed that I never used the extra services. Plus the more services a building has the more the maint fee is. I wanted a low maint fee, because I wanted to live cheap, but still own a place that I would be happy and proud living in

          = just FYI, at Infinity I was paying 43 cents per square foot, however once the developer/investor turns the building over to the buildings HOA the maintenance will be going up to 65 cents per foot. Note this is what the developer told me back in 2009 when I bought my Infinity condo, so it could be more when that happens. Another expense that I would have to start paying is when the Infinity HOA starts collecting for reserves, which was to be $200 per month in additional to the maint fee. I am so glad I sold before my maint fee went up and be the reserves collection started to kick in. So at this moment Infinity doesn’t have any reserves. I my new community has a decent amount of reserves.

          How do owners handle repairs to the common building elements and to their own units?
          = My Maint fee cover repairs and upkeep of common building elements (buildings outside walls, roofs, pool, driveways and landscaping) My Maint also covers insurance on the outside of the buildings, grounds , and includes water and cable with some HBO channels. If you pay less $10 per month to Comcast they will upgrade your standard cable box to HD and you get A LOT of HD channels. It is a great deal for less then $10 per month. You do have to pay for you own internet access. Repairs to the inside of the unit is the owners responsible. Which is the same way it was at Infinity.

          Because you are a knowledgeable young and year round resident I bet the part timers would love to have you on the BOD to oversee their interests especially when they are away for summer .
          = there is an older man that is one of the original owners who is the condo assoc pres, I know he would want me to be on the board someday, however I don’t want that responsibility. Having no responsibility is the best thing about owning a condo. I have gotten lazy since I become a condo owner. It’s killing me that I had to work my butt off updating my new place and get it up to my standards with my décor and taste, etc. In 2 weeks my new place will be100% completed and I can’t wait. I don’t want to move again ever. It is just too much work!
          however that is it. It’s not a full service building like Infinity. I did not want another full service building cause I noticed that I never used the extra services. Plus the more services a building has the more the maint fee is. I wanted a low maint fee, cause I want to live cheap. But still be in a place that I would happy living in.

          How do owners handle repairs to the common building elements and to their own units?
          Because you are a knowledgeable young and year round resident I bet the part timers would love to have you on the BOD to oversee their interests especially when they are away for summer .

  66. MMT: “I wonder how DJ is doing with his purchase.”

    Just logged on here for the first time in a while….seems like new Lucas articles are pretty sporadic these days. First of congrats to owner for making such a nice profit on his sale. Sweet man, very sweet.

    As for me, I’m still going strong, still loving my condo. Sales have been pretty steady here. I think the developer still owns about 30/164 units. We had our turnover about six months ago and I’m currently on the BOD. We’re working to cancel/renegotiate our service contracts and insurance now to keep the maintenance fees low/reduce them. As for value, it’s a little hard to calculate based on the different floor plans or which side of the building you’re on, etc. I live in the most desirable line (A-line facing south), so the closest comp would be the unit directly below me that sold several months ago for $450,000. By comparison I bought my unit for $371,000 just under two years ago, which included lots of nice upgrades (marble floors, window treatments, lighting, etc.) so I’m happy with where I’m sitting. No plans to sell in the foreseeable future.

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