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Miami & Miami Beach Condo Trends – July 2009

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I collected the following figures last Thursday night on July 23, 2009.  It has been about six months since I last published inventory numbers for condos in Miami-Dade County.  The last Miami & Miami Beach Condo Trends post was published on January 19, 2009.

As many of you read earlier today, the Case-Shiller price index rose on a month-to-month basis for the first time in 3 years.  13 of the 20 cities in the index showed month-over-month price gains in May when compared with April 2009.  However, Miami was not one of the 13 cities to show an improvement in prices.  Home prices in Miami saw a decrease of .8 percent during that period.

There may not have been an increase in home prices in Miami but the figures below show a major improvement in the number of closed condo sales in the previous six months when compared to the closed condo sales in the six months prior to January 2009.  For example, there were 3,551 closed condo sales in the six months leading up to January 2009 compared to the 5,007 closed condo sales that occurred within the past six months.  That’s an increase of 41 percent.  The number of closed condo sales in Miami improved approximately 39 percent while closed condo sales in Miami Beach increased about 20 percent. As a result, the condo supply numbers for each showed considerable improvements as well.

View the entire workbook for this month’s Miami & Miami Beach Condo Trends.  The various spreadsheets and graphs are found at the bottom.

Below, you will find the Miami-Dade County condo inventory and supply figures for July 2009:

Dade County condo inventory spreadsheet July 2009

Dade Available Condos Graph
Dade Closed Condos Graph

The following statistics encompass only those condos located throughout Miami (not other areas of Dade County such as Miami Beach, Aventura, Sunny Isles Beach, etc.):

Miami condo inventory spreadsheet July 2009

Miami Available Condos Graph
Miami Closed Condos Graph

The following statistics encompass only those condos located throughout Miami Beach:

Miami Beach condo inventory spreadsheet July 2009

Miami Beach Available Condos Graph
Miami Beach Closed Condos Graph

This has been a very atypical year for real estate sales in South Florida.  In most years, the vast majority of closed condo sales occur in the Winter months when snowbirds flock to Florida to shop for a vacation home to escape the dreaded cold.  However, this past Winter season was unusually slow due to a number of reasons such as the paralyzing fear in the economy and a lack of financing.  After the first 3 months of the year, I personally felt that 2009 was shaping up to be my worst year in real estate.  However, at the beginning of April, business began to show life again.  In fact, activity has drastically improved to the point where 2009 could end up being one of my best years.  I personally feel that the Miami condo market is within 2-3 months of reaching the bottom.  That’s in no way saying that prices will begin to increase soon after.  The overall market needs to move sideways for at least the next 12-24 months before we see any significant increase in sales prices.



198 thoughts on “Miami & Miami Beach Condo Trends – July 2009

  1. Isn’t the condo/housing market really bifurcated at the jumbo loan cutoff amount which I think is about 500K?

    It seems the bulk of any good news is in the lower to middle spectrum.

  2. First of all, great work, Lucas. Much appreciated.

    These numbers look better than I would have expected, but I’m still not sure there’s much good news in there for the market. Miami still has 22 months of inventory and Miami Beach has 28 months, and I’d bet those numbers really are at least 30 and 35, if all investor-held units were on the market (i.e., if there was no “shadow inventory” of which Renter Tom often speaks).

    Further, the lack of action on units priced at $500,000 or higher seems like real estate Armageddon has hit Miami. The market has an astonishing 6 years’ worth of inventory for units $1 million to $2.5 mil, 7 years’ worth of inventory in the $2.5 mil to $5 mil range, and 5 years’ worth of inventory for units priced at $5 mil and higher. Those numbers are so unbelievable, I’d bet they’ve never before been matched in any r.e. market in the U.S. How the hell did so much high-end construction get financed in one of the poorest metro areas in the country?

  3. Seems like a rich peoples problem and going to be like that for a long time.
    Middle & Upper Middle class props (under 500k) are doing ok and may recover sooner.
    So if you are in the market for a prop over 1 mil, then you can afford to wait and get your pick for the best price possible.

  4. Well, those “rich people’s” property taxes comprise a large chunk of Miami-Dade’s budget, so it’s not just a “rich people’s problem.” With every dollar in price that those high-end condos fall, everyone else has to pick up the slack.

  5. Interesting article from the NYT, Lucas. We have reached the point of capitulation in Miami, or are very close to it. I’ve been a nay-sayer on most of my few posts on this blog, but when prices hit below $200/SF I will be nosing around.

    It’s interesting to read posts from two years ago saying that prices will fall below or will never fall below $200/SF, or that vulture investors will sweep in, or not (the vultures were too smart.)

    I suspect the rest of 2009 will be a good year for realtors who have properly-priced-properties.

    I totally agree with Lucas that the market (at least for us poors) will move sideways for a while.

  6. look at the stats of $1M+ sold in Miami Dade county and you get 2.9% of the total sales. Now look at the number of available properties at $1M+ and you get 8.3% of the total available.

    I always pick on the higher end prices as it is easier to see the inflation there. I see this as even if people with more money start buying condos, the prices need to come down closer to what is selling.

    I think it is great the market is starting to recover, I just hope people realize that we cannot see the large gains that we saw before or else we will be right back to 2007/2008.

    Thanks Lucas for posting this. I would love to see some occupancy rates for the various condos around miami-dade.

  7. As I’ve said before, when prices reach a low enough level, people will start buying again. It’s inevitable. Contrary to what many on here have said, people do still have money, and there are a lot of people with money watching this market intently. Once the price on anything drops enough to start being attractive, someone will come in and buy. It won’t happen over-night, but I think we’re starting to see the early stages of it.

  8. Re: Lucas and post #6, congrats on being quoted in the NY Times.

    However, that article is all kinds of ugly for the Miami market. I can’t believe how a lot of the people in that article (and others) are trying to polish a turd here and pretend things are looking up.

    For one thing, the NYT article says just 31 out of 1,646 units at Icon Brickell have sold. 31 out of 1,646!!

    For another, the NYT article says just 31% of the condos in downtown Miami are owner-occupied. That’s a god-awful percentage by any standard, and it essentially means there’s a 31% “shadow inventory” of units waiting to be sold 1-2 years down the road when the rental leases expire.

    I’m starting to think this little mini-wave of r.e. articles is just the newspaper business going back to its old trick of whoring itself out to the r.e. businessin order to help sell r.e. ads. Otherwise, I just don’t see the good news people keep talking about. Four years’ worth of inventory? Almost no sales at $500,000 and above? Yuck.

  9. What is interesting as the Great Deleveraging continues, country clubs, golf clubs, and other shared interest luxury real estate goes BK. It is happening all across the country, just wish newspapers would do a comprehensive story on what has been going on as members drop out, dues go unpaid, and these things get foreclosed upon…..just like the shared interest in condos, same thing really. It makes me think that debt is bad enough, but shared debt is far far worse. Here is one example:

    http://www.miamiherald.com/news/breaking-news/story/1162109.html

  10. I forgot to mention earlier that in Met 1 the developer has started leasing out units. Any other buildings doing the same?

  11. Lucas… again, great data.

    I don’t want to beat a dead horse, but your comments at the beginning are a bit misleading as it is using NON SEASONALLY ADJUSTED data. If you look at he C-S SEASONALLY ADJUSTED DATA, you will see that Miami actually saw a drop of 1.38%.

    It is important to highlight that the monthly % drop is getting smaller, which are signs that recovery might not be that far away, but we are definitely not there yet.

    I agree with Joe (#11). Plenty of bad things and your data just reinforces that.

    Let’s take the units under $500k as I think that can be considered he middle of the market (80% of listings):

    Units under $250k
    Months of supply: 16.4

    Unitts $250k – $499k
    Moths of supply: 38.1

    With the foreclosures adding up every month, how can we really say that the market is stabilizing? Stabilization usually means that supply is under 10 months and we are still far away from that in this market. 16 months? 34 months?

    Sales volume might be picking up, but it’s due to reduced pricing. This will continue as you will see overall sales drop significantly in the fall and people will do whatever they can to move inventory. Add the foreclosures that are being processed now and you get further drops in pricing.

  12. Joe,
    I do agree regarding the rich paying a lot of prop taxes in Miami for their skyboxes. I guess that is the price to pay for living 4 to a floor or entering into your flat directly from a lift.

  13. If the banks put there all foreclosed units on the market today the numbers would be horrible. If the flippers and bulk buyers listed all their stuck units today the number would be even worse.
    What happens when these interest only loans change over to principal and interest? Nobody wants to refinance negative equity homes

    Watch what happens when property taxes go up.
    Nice push to get people into homes before the next property tax increases and the return of higher interest rates.

    Housing Recovery: Sell Now Or Your Capital Will Be Trapped
    http://www.oftwominds.com/blogjuly09/rates-capital-trap07-09.html

  14. A request for all those living in OMNI-Pace, Edgewater, Midtown, Wynnwood:

    There is a meeting on Monday August 3rd at La Provence French Bakery on Biscayne Blvd at 22nd street to talk and answer questions about new, major Biscayne Blvd construction planned starting next month. A DOT rep will be there too. It is a major project of significant importance for us living in this area as it is supposed to transform the already nice looking Biscayne Blvd into an extraordinary thoroughfare.

    There is one point though that required to be raised. A waterfront walkway that has been planned for many years is mentioned in the said improvement but only as a “low priority project”. It is essential for as many citizens as possible to keep raising this issue in every possible forum to stress how important this waterfront walk way is for all of us, the entire neighborhood and the city of Miami. This walkway if I am not mistaken will eventually be connected to the Bicentennial Park via under the Mc Arthur.

    Try and attend that meeting. It is also a good chance for you to experience La Provence. It is a very beautiful and delightful french bistro/bakery on the blvd.

    Original email:

    From: RICH STRELL
    To: miamiwater@gmail.com

    Subject: Meet Mon, La PROVENCE Bakery, 6:30 PM,

    NEW LOCATION-
    Aug. 3rd, first monday and 6:30 PM,

    Our next meeting is at:

    La Provence Bakey
    2200 Biscayne Blvd,
    Miami FL 33137

    A rep from FDOT will come to talk and answer questions about new, major Biscayne Blvd construction planned starting next month for our area! Tell your condo boards this is happening, as well.

  15. Wild Bill,
    So what is wrong in controlling the markets? It has been happening since man started trading since the early times.

    If China, India, South Korea and Japan start off loading their Dollar holdings all at once, our greenback would not even be worth as a toilet paper. So they are releasing it a bit by bit and slowly reducing their exposure to dollar by denominating their Foreign currency reserves into gold, euros, SDR and other instruments.

    I applaud the banks for controlling the flow of foreclosure. Only anarchists who want a wholesale destruction of this economy would want a dam break flood of foreclosure units to happen. It is not good for anybody. It is even worse for those who are waiting to buy a flat on the cheap as the resulting consequences are going to be horrific and across the board. So what is happening is good and should be welcomed by all.

  16. AJ #21 – Wrong. The sooner we get to a clearing price, the better it is for everyone. The analogy to holding US Dollars is wrong….they hold debt with specific maturity dates. There are others out there that would buy up the debt albeit at probably a higher interest rate.

  17. Lucas

    Whats missing here of course are graphs and charts similar to the ones posted on all of your previous reports. The true gauge or measure of how healthy the market is – would be the ratio of closings on Miami New Condos that started closings on or after the financial crisis of about October 08. You can slice and dice the above numbers all you want but they are irrelevant without the number of closings at the following buildings:
    1 – Icon Brickell
    2 – Everglades On The Bay
    3 – Infinity
    4 – Axis
    5 – Epic
    6 – 900 Biscayne
    7 – Met One

  18. RT, what do you think would happen to these banks if they dumped all the foreclosures onto the market at once?

    They’d all collapse, just like the local housing market would. I really don’t see how that would be good for anyone.

  19. DJ – The banks have dug their own graves. Many are already insolvent regardless of whether they start to unload their properties or not…that is the reality they are pretending to avoid. The banks should have unloaded properties from the beginning instead of holding back and now they have tons of properties…they dig their own graves. So what. A market clearing price IS the real market price…why wait, why pretend?

  20. Banks don’t pay condominium maintenance fees.
    Banks only pay property taxes.
    A bank owned unit is the same a vacant unit.
    A building will not have a balanced budget unless they have special assessments to make up for the vacant unit.
    Real estate should not be looked at as an investment.
    The sole purpose of the board is to protect and maintain the building and to make sure they collect the funds to do that.
    They should not care if a unit sells for a dollar, they need somebody to pay the maintenance fees on the vacant unit.

    Every condo in Florida should have to upload a PDF file of their yearly budget to http://www.myflorida.com/dbpr/ This state is a joke.
    New buyers are walking into a minefield.

  21. hey guys..always read this blog, but decided to join this time..Lucas, congrats on your great website!
    does anyone have any input on this info from the NYT article?
    ONLY 31 UNITS SOLD AT ICON BRICKELL???
    When I was there to see the property, their agent told me that tower I was almost fully occupied and that tower II was going to be much more expensive!
    Of course, I didn´t buy that, but only 31 units??
    Prices there have been dramatically reduced, but it seems they still have a long way to fall!!

  22. A state website should host records of condominium yearly budgets. Bank and prospective buyers should have easy view of them. Banks want to know about reserve figures. Seems only logical that when a budget is passed it should be posted on a official website where everybody can look it up.
    Scan your condo budget for the last few years you will see how money is shuffled from one line item to the next. A ponzi scheme that will soon run its course.
    That’s why many buildings are declaring bankruptcy. Time ran out, couldn’t get new suckers in fast enough to pay off for the losers that don’t pay. Some of those losers are banks.

  23. Well I can see for some people no amount of data will convince them. Many of these are the same people still waiting for the S&P Index to hit 450 so they can start investing. Bottom line is that earlier this year things looked bleak, really bleak and many people were scared. Today, things look better much better there is hope where there was none 5 months ago. Markets are not were we would like them but the death spiral has stoped and it looks like the economy is digging it’s way back to some normalicy.

    What get me upset is that people (like Lucas and others) who participate in the marketplace day in and day out have been telling readers things have improved somewaht but we have these serial bloggers who couldn’t transact a ham sandwich at the corner store get on here to question his credibality.

    Markets over react on the up-side and on the down side that is a fact. Just look at the stock market in March. Many people got scared and decided to sell their entire holdings at that time instead of buying. I was experienced enough to know it was a great investing opportunity so I bought many financials and commodity while many experts were telling people to sell at S&P 650 calling for S&P to go down to 450. I see the real estae market as the same way. Prices in many places have over-corrected and many people are calling for the equavilent of SP 450. Maybe we get to the equavilent of SP450 wouldn’t you be getting a deal of a lifetime at this level?

  24. Oh, yeah! I’m off to Costa Rica and Nicaragua while you guys wait for property tax hikes, lower condo prices, collapse of the dollar, Dow 3500, the Great Deleveraging and the US economy to implode . Please be sure to shoot me an email when it happens.

  25. makes me think – You’re such a player you….congrats if you’re looking for positive feedback (sarcasm). Your misplaced optimism will get slapped down. Do you think the debt has just magically gone away? The federal govt needs to issue $3T in debt of which $1T is rollover debt and $2T in new debt instruments. Incomes are down across the board but debt service is at an all time high. Stocks will take a second dip this year…I am putting my money where my mouth is on that one.

    According to the National Association of Realtors (CNBC graphic), the June 2008 to June 2009 transactions – year over year comparison nationwide….the action is on the LOW end, foreclosures and distressed sales:
    $0-$100K: UP 39%
    $100K-$250K: UP 9.4%
    $250K-$500K: DOWN 11.5%
    $500K-$1M: DOWN 15%
    $1M-$2M: DOWN 28%
    $2M+: DOWN 39%

    We will see the mid and upper end prices continue to fall, of that, there is no doubt.

  26. RT, it doesn’t matter, you read too many negative blogs.
    $3T in debt, Wow! That’s too big a number for little o’l me to worry about. Since I can’t write a check for it and I can’t do anything about it, I’ll let you worry about it for me. In the mean time I’ll be in Central America. Shoot me an email when you have the problem solved.

  27. anyone on icon brickell?is it really true only 31 units have been sold?
    if that info is true, what will happen when more high end condos such as paramount and marquis hit the market ?
    One thing is for sure…No way paramount bay developers will be able to sell a 2bd for over 1M as originally planned!

  28. The market has certainly changed in the last 90 days. This much is certain.

    Partly due to the fact tat FNMA is buying loans so liquidity is back and developers and lenders are facing reality so prices have dropped.

    Take Avenue for example, closing over 150 units in 60 days. They are absolutely plowing through their remaining inventory. I mean, in a time period of 90-180 days there were only 115 closings in all of Brickell!

    Its hard to believe prices will continue to drop much further if closings continue at this pace. Even more so that the winter snow birds are fast approaching.

    HOWEVER, there is still a lot of unknowns in the market. Will Corus Bank go bellyup? Will lenders f/c and firesale a couple of major projects? All this could cause the market to implode very quickly.

    Not saying this will happen but its certainly a possibility to keep in mind but not one to hold your hat on either.

  29. RT, you don’t have to tell me. I’m the guy trying to buy these foreclosed property. I’m not the guy on this blog reading about the economy I’m the one transacting in this economy, putting my money where my mouth is. I know one thing, if the economy get’s as bad as you say, I’ll have my choice of several homes (free and clear) to live in with enough land to grow my vegs and raise chickens with the shotgun to protect what’s mine. Don’t mean to be smug but i have more important things to worry about.

  30. MMT, Your posts are hilarious. Funny thing is they are so true. Why split hairs over things such as the national debt that you have no control over? Anyway make sure you grow organic chickens, I will buy some from you, oh no, wait a minute, America will become an apocalyptic wasteland due to a total economic meltdown and there wont be any dollars anymore. I will barter some goats I plan to raise in the land that I own in Hernando and Citrus counties. For protection I will have minefields around the perimeter.

  31. Wild Bill,
    How is that a bad thing? I think it is the best thing the arse back Floriduh has done for while. When condo budgets are out in the open, there is a lesser chance to scam and skim. I hope all other states follow suit.
    For once Florida leads in this issue instead of pioneer states like Cali or NY.
    (OK when is the workplace smoking ban going to be effected in Florida? After the entire rest of the World does it?)

  32. Wild Bill is right.

    Buying a condo is like buying into a business with 300 strangers you have never met, with various levels of credit scores. So many buyers buy into a building “blind” not knowing what type of financial traps await them.

    I pity the fools who buy in now, and get slapped with a nice $3000 special assessment in Nov/Dec to make up for the shortfall.

    I know of one South Beach building that regularly has special assessments at the end of the year. Dues are low every month compared to nearby buildings, and thats what potential buying suckers see. Then each December they get a nice balloon bill.

  33. MMT
    Opinions like yours are like assholes – everybody has one. And yeah enjoy Honduras or whatever on yer visit south – I hear its lovely there this time of year!

  34. intersting article from the NY Times, with Lucas being quoted, great job,

    July 29, 2009
    Square Feet
    As Prices Plummet, Condo Sales in Miami Perk Up
    By TERRY PRISTIN
    Despite a vast oversupply of new condos in downtown Miami, sales have been brisk lately at 1060 Brickell Avenue, a twin-tower development with 570 units in the heart of the upscale Brickell neighborhood. The reason? Prices have been cut in half, to about $200 a square foot.

    “We reset the prices at a sharp discount, and the units are flying off the shelves,” said Gary Barnett, the president of the Extell Development Company, the New York-based developer of 1060 Brickell, which was completed last year. More than 200 units have closed since the discount program began in April, he said.

    Mr. Barnett, who has developed several new condominium projects in Manhattan, including 535 West End Avenue and the Rushmore, acknowledged that he and his backers lost their entire investment in 1060 Brickell, which is situated at Southeast First Avenue. He said some, but not all, of the mezzanine financing was also wiped out. But because more than 40 percent of the units sold at full price, Mr. Barnett was able to repay his $153 million first mortgage from TD Bank and iStar, a troubled finance company that bet heavily on the South Florida condo market.

    Since 2003, nearly 23,000 new condo units have been added to the downtown skyline, from Brickell Avenue up through the more modest Biscayne Corridor — far more than this city of 400,000 people could absorb. About 9,400 remained unsold at the end of June, according to Peter Zalewski, the owner of Condo Vultures Realty, a local brokerage.

    But Miami real estate brokers, lawyers and developers say the overbuilt condo market has entered a new phase. “Things are starting to move through the system,” said Adam Cappel, the president of CondoReports.com, a Miami research service.

    Until recently, many real estate professionals expected investment funds seeking opportunities in distressed real estate to swoop down on Miami and buy condo units by the hundreds at wholesale prices and then rent them out until the market recovered.

    A few bulk purchases have occurred — in the dozens rather than the hundreds — but most buyers have paid the current market price, not a wholesale price. For example, an investor from Colombia recently bought 31 units at 1060 Brickell for an average of $203 a square foot, according to Mr. Zalewski. Last week, however, a private equity group paid only $63 a square foot for 51 oceanfront condo-hotel units at the Regent Hotel in Miami Beach, he said. Previous units there had sold for $1,100 a square foot. But condo-hotel units are considered riskier and harder to finance than traditional condos.

    For the most part, bulk condo sales have yet to catch on. With the steep decline in values, developers of newer buildings are no longer in control of their projects and must defer to their lenders. “The lenders did not want to take the hit that the bulk purchasers were offering,” said Martin A. Schwartz, a partner at Bilzin Sumberg, a Miami law firm that represents developers.

    Another obstacle is that under Florida law, anyone who buys seven condos in a building with 70 or more units may be assuming all the liabilities of a developer, Mr. Schwartz said. “There is an element of risk,” he said. Mr. Barnett, for example, was unable to arrange a bulk sale for 346 units at 1060 Brickell last year at $200 a square foot.

    Robert Kaplan, a principal of Olympian Capital Group, a Miami mortgage brokerage, said the focus had shifted away from bulk sales to retail sales because lenders were not willing to take $100 to $125 a square foot when they could get $175 or more. “Every condo lender is considering market-rate sales,” he said. “They have no choice.”

    Bargains are being offered for under $200 a square foot at Brickell on the River South, near Southeast Fifth Street. At 500 Brickell, developed by the Related Group of Florida, the industry leader, prices for one-bedroom apartments have dropped to $180,000, from $260,000, said Lucas Lechuga, an agent for Keller Williams Realty in Miami. “The buildings that have slashed their prices are doing pretty well now,” he said.

    If demand does not keep up, prices will have to adjust, Mr. Kaplan said. “But we’re not seeing that yet,” he added. “We’re seeing velocity at the new lower prices,”

    According to Ronald A. Shuffield, the president of Esslinger-Wooten-Maxwell, a local brokerage, condo sales in new buildings increased to 82 a month, from an average of 50 a month, since April.

    Jack McCabe, the chief executive of McCabe Research and Consulting in Deerfield Beach, Fla., said, however, that he thought prices were likely to drop a lot further because of the high volume of foreclosures. “There are a lot of buildings where 30 to 35 percent of the units are in foreclosure,” he said. He predicted that bulk sales at prices as low as $100 a square foot would eventually occur, especially for inland properties. “It’s still early,” he said.

    In newer buildings with many unsold condos, developers are negotiating uncontested, or “friendly,” foreclosures with their lenders, sparing them the expense of a protracted battle. Last month, the Related Group surrendered its 420-unit CityPlace South development in West Palm Beach, Fla., where only 39 sales had been completed, to a group of lenders led by the Bank of Nova Scotia. Related paid an undisclosed sum to cancel its $119 million construction loan and other liabilities and won the right to continue to manage and maintain the project and run the sales operation — all for lucrative fees.

    According to recent news reports, Related hopes to work out a similar arrangement within the next couple of months to retire about $1.5 billion in outstanding debt on other South Florida condo projects, including the company’s showpiece, Icon Brickell, where only 31 of 1,646 units have sold. Related executives did not return telephone calls.

    Thomas R. Lehman, a Miami lawyer who has been negotiating several friendly foreclosures, said many developers had already quietly turned over the keys to their projects. “The wave has started,” said Mr. Lehman, the managing partner at Tew Cardenas. “Public records are catching up to what’s already been negotiated. Lenders are realizing that no one is going to buy their loans and they might as well get their projects back and put them on the market.” He said developers often were trying to preserve other assets they might have put up as collateral for their construction loan.

    But what has been a catastrophe for developers has been a bonanza for renters. According to a report commissioned by the Miami Downtown Development Authority, a quasi-independent city agency, 62 percent of the already completed new downtown condo units are occupied, split evenly between renters and owners. Monthly rents have declined 15 to 20 percent in Miami, with the median rate at $1.64 a square foot, Mr. Zalewski said.

    The Related Group has instituted an unusual rent-to-own program, in which no price is set in advance and all of the rental payments count toward a down payment, if the unit is purchased within a year.

    Joe Higgins, the owner of Grove Town Properties, a local brokerage, said about one-quarter of his rental clients were University of Miami law students doubling up with roommates, but the rest were professionals working downtown.

    With so many new buildings on the market, tenants have become choosy and now demand features like an updated kitchen, Mr. Higgins said. “Renters don’t want the older buildings,” he said. “They want the granite; they want the stainless steel.”

  35. At the $64 sq. ft. price we saw last week the inventory would shrink to near zero overnight. Absolute auction sales also clear inventory instantly. Only 1-2 percent of households earn over $250,000 which is what is needed to support a million dollar condo. Buyers in California now get a form disclosing exactly what their dollar share is for unfunded reserves prior to closing.

  36. How sweet is this news?

    Dozens charged in $40 million mortgage-fraud scheme
    Forty-one people were involved in a $40 million mortgage-fraud scheme, the acting U.S. attorney said.

    Federal prosecutors say 41 people have been charged in the latest round of South Florida mortgage fraud schemes.

    The charges stem from six separate cases involving about $41 million in fraudulent mortgages. Some cases involve fraud at nearly every level of the transaction, from purchasers to lenders to title companies.

    Acting Miami U.S. Attorney Jeffrey Sloman says an anti-fraud initiative in South Florida has resulted in charges against 218 people since 2007. The total fraud was pegged at more than $268 million.

    Forty-one people are facing a variety of charges involving some $40 million in bogus loans in schemes that underscore an epidemic of mortgage fraud in South Florida, federal prosecutors said Tuesday.

    The six separate cases illustrate the pervasive nature of fraud that often runs the gamut of the mortgage industry, from purchasers to mortgage brokers to real estate agents to lawyers, said acting Miami U.S. Attorney Jeffrey Sloman.

    “Obviously, there is a profit motive for everybody involved in these cases,” Sloman said at a news conference.

    State regulators are pressing their case against four South Florida foreclosure rescue companies this week, as federal regulators crack down on an industry they say is taking millions from desperate homeowners but doing little or nothing for them.

    A Palm Beach Circuit Court judge granted the Florida Attorney General’s Office an emergency ruling Friday, requiring four mortgage modification operations to cease doing business: FHA All Day.Com, Safety Financial Services, Housing Assistance Law Center and Housing Assistance Now.

    Investigators last week went to a Deerfield Beach storefront that once was the address for at least two of the businesses and found bags of shredded paperwork, said Regional Deputy Attorney General Cindy Guerra.

    To neighboring residents, the string of rapid-fire sales at a Coral Gables home was emblematic of the cause and consequences of South Florida’s housing bust. The four-bedroom house, now vacant and deteriorating, was sold, bought and foreclosed on three times in less than three years.

    Neighbors always suspected ”something wasn’t right with the milk” at 330 Alesio Ave. as the value of the home more than doubled to $1.2 million in the short time span. It turns out they were on to something.

    This week a federal judge sentenced Jose G. Martin, who had onced posed as a renter in the home, to 65 months in prison for orchestrating a $6.6 million mortgage fraud scheme involving the Alesio property and six other homes in Miami-Dade County.
    By LUIS ANDRES HENAO
    lhenao@MiamiHerald.com

    Forty-one people have been charged with taking part in a $40 million mortgage-fraud scheme, federal authorities said Tuesday in Miami.

    Acting U.S. Attorney Jeffrey Sloman said the fraud involved a network of fake purchasers, crooked mortgage brokers and cooperative bank employees who arranged for inflated mortgages.

    In mortgage-fraud scams typical during the boom, a team of mortgage professionals — often including attorneys, mortgage brokers and appraisers — would pay stand-in buyers to use their identities to get mortgages for the purchase of inflated properties. They would often never make payments on the loans and the homes would soon enter foreclosure.

    At a news conference, Sloman said the 41 people — all but one are from South Florida — were the most recent in an investigation of mortgage fraud that began in September 2007 with a multiagency task force, including the U.S. Secret Service, the Postal Inspection Service, FBI, Federal Deposit Insurance Corp., the U.S. Department of Housing and Urban Development, and state and local police agencies.

    “The success of the Federal-State Mortgage Fraud Strike Force and our mortgage fraud crackdown is evident in the staggering number of prosecutions we have brought to date,” Sloman said. “Mortgage fraud investigations will continue to be one of our top priorities.”

    Others involved in the scam included title agents and attorneys, Sloman said.

    “As we can see from this case mortgage fraud reaches every aspect of the mortgage industry,” Sloman said.

    Since the task force’s creation, a total of 218 people in Florida have been charged with participating in mortgage-fraud schemes resulting in nearly $300 million in bogus mortgage loans. The FBI is investigating 2,100 cases nationwide, according to Sloman — who said that number was five times the number being probed last year.

    http://www.miamiherald.com/486/story/1161591.html?storylink=omni_popular

  37. Hey Lucas,

    Since no one seems to have any info on the ” only 31 units sold at icon brickell” as quoted on the NYT article, could you elaborate on this? Any insider’s indo? Thanks

  38. This is an amusing article-
    ——————–

    Downtown Fort Myers condo has 32 stories, and one lonely tale

    Condo can get spooky for tower’s only family

    DICK HOGAN
    dhogan@news-press.com

    Victor Vangelakos lives in a luxury condominium tower on the Caloosahatchee River. He never has to worry about the neighbors making too much noise.
    There are no neighbors.

    Vangelakos, 45, his wife Cathy and their three children are the only residents in the 32-story Oasis I condo on the east edge of downtown Fort Myers.

    The 45-year-old Weehawken, N.J., firefighter bought the condo from Miami-based The Related Group for $430,000 and closed on it in November. He planned to make it a vacation getaway and eventually his full-time residence when he retires in four years.

    But prices have fallen hard since the real estate bubble burst in early 2006. Only a handful of those who put down deposits on the tower’s units actually closed on the deal. Those who did have swapped their Oasis I units for condos in Oasis II next door.

    Vangelakos didn’t, because he was unable to convince his lender to agree to the swap, said Betsy Lu McCoy, vice president and associate corporate counsel for Related.

    That leaves the Vangelakos family splitting their time between New Jersey and a creepy, surreal life in Oasis I.

    They’re the only ones using a well-appointed clubhouse, but they can’t watch the big plasma TV.

    “We haven’t found the remote controls,” Victor said.

    Pause for a moment anywhere in the building during the day and the silence is deafening.

    At night, Vangelakos said, they often hear people on the grounds or even inside the building itself. It’s not hard to break in one of the many entrances.

    Once, late at night, “Somebody banged on our door,” Vanelakos said.

    It wouldn’t have been hard to find the person in the otherwise darkened building.
    “At night,” he said, “you can see our TV from the street.”

    Especially popular for intruders is the swimming pool, Vangelakos said. They heard people there one night “and the next day all our chairs were in the pool.”

    His relationship with Related is testy at best. Once, he said, when management turned off his water to fix a leak in a pipe, “we came back 10 days later and the water was off but our TV was on.”

    Now, after months of exchanging letters with Related about building maintenance and other issues, Vangelakos said he just wants out.

    He hasn’t filed a lawsuit but his attorney, Fort Lauderdale-based John Ewing, said Related hasn’t delivered the marina, pro shop and fancy restaurants that were promised.

    “They have the ability to buy him out,” Ewing said. “They can resolve this in a fair way.”
    McCoy said it’s not that simple.

    “His concerns have not fallen on deaf ears,” she said, but it isn’t Related’s fault he hasn’t been able to persuade his lender, JP Morgan Chase Bank, to transfer the mortgage to a unit in Oasis II.

    “What he paid went to our lender, it didn’t come to us,” McCoy noted, so Related would have to pay off the mortgage before it got the unit back.

    Besides, she said, the situation is the result of market forces beyond anyone’s control.

    “We did not foresee, nor did anyone else foresee, the collapse of the real estate business and the concurrent collapse of the lending industry,” McCoy said. “They’re caught and we’re caught.”

  39. DREW

    Ho-Hum another firefighter retires while still in his forties Im gonna cash in my kids college saving plan and and then payoff somebody to get him in Miami-Dade fire-police union when he turns 18. He should be able to retire when he is 42 yrs old and collect his $100,000. pension for the rest of his life. Sweet!

  40. MCO
    Your question about closing rates at Icon Brickell ( and Epic -Everglades – Infinity – etc. ) is the most important question being asked here. The answer is DEAD SILENCE. Lucas for over two years has provided closing rates on monthly or bi-monthly basis as each new building downtown started closings. Very disappointing.

  41. Kramer>
    Its b/c ICON was supposed to be the Crown Jewel from TRG and it is turned out to be the biggest Miami residential real estate debacle ever and I can only assume Jorge Perez is so humiliated, embarassed and perplexed that he has threatened Lucas, et al that any negative publicity by Realtors will be met with crippling litigation or kidnapping.

  42. Drew
    the trials and tribulations of ICON are well documented. there are no closings to report of. and i don’t think jorge is humiliated. he’s doing much better than a lot of other folks in this downturn. the end game is he will turn over the keys to the project to his lenders and get a managment fee going forward. not a bad deal.

    btw, the girls in the sales office for icon are top notch. catalina and her crunchy perm hair harkens back to 80s music video hot.

  43. Kramer – That is sooo true about fire fighters. But you forgot they all have side jobs for extra cash (few declare for taxes) during the time they are fire fighters too. Oh, and the paid time off for a hang nail…..and of course the overtime, a lot of overtime. Their jobs are important but the pay and admin involved is very bloated. And all they do is belly ache. I guess it has to do with all that sitting around in a Lay-Z-Boy and being bored…gotta find something to do I suppose. We really need an EMT model that also fights fires instead of the reverse we have now since few people die in fires and very few are saved from burning buildings….sooo many die from heart problems, accidents, etc. Time for a new model emphasizing EMT.

  44. How many live downtown?

    Far fewer than developers want and need to stay afloat BUT seeing incremental signs of life.
    On Tuesday spoke with employee of Cabi that built Everglades condo downtown: he said that Cabi has sold app 100 units and that another 100+have been leased .
    Yoicks- sounds like 200+ down 600 to go…

    Also noticed an increasing number of window coverings at the flatulent Wind by Neo-perhaps 35-40% now versus very little 6 months ago.
    And windows on the south side of the new building -Ivy-adjacent to Wind now appear 50-60% + covered presumably occupied.

    The nicest of 3 is Mint and do not know if building has has any closings/rentals move ins .

  45. jcrimes-
    With Icon, Perez’s ego will take a greater hit than his pocketbook (maybe). Nonetheless, his reputation is damaged due to the lack of foresight regarding project timing. And his tootie-fruity designer Phillipe Starck surely took a reputational hit also. That design is way too niche-driven and even in a booming economy its going to be tough to find 1,600 buyers who are attracted to the stupid whimsical Alice in Wonderland theme in Icon. It might be ok for a hotel, but not a condo.

  46. KRAMER

    Thanks for you rreply.
    no one seems to question how a building that only has had 31 sold units may charge almost 900k for a 2bd with some water view.
    the building is great, but when you know there are only 31 owners, you wonder how long the prices will be able to hold up..especially with paramount bay and marquis joining the extensive list of inventory..
    just like you said..DEAD SILENCE

  47. Drew
    no comments on the design. and the units themselves are nothing spectacular. i’ve written my review some time ago.

    as to perez’s pocketbook, sorry drew, but the only hit he’s taking is upside. he has no guaranty exposure according to my sources. pretty savvy if you ask me (in fact, the way he structured all these deals is pretty damn savvy but that’s a conversation for another time). as for his rep, frankly, it’s his rep that has kept him above water compared to his peers and will keep him in the game going forward. outside of a well helled developer (do they even exist these days) who wants to make an aggressive play for the icon paper, these banks need perez “on that wall…[they] want him on that wall.”

  48. I’m sure he has no personal guaranty and of course the holding company is a single purpose LLC or partnership that will be exposed with all other TRG assets shielded. But he’s been playing with OPM on these projects and I’m sure all the South American equity partners are disappointed that they had little if any investment return on Icon and other projects where sales stalled without being close to paying off the construction loan.

    Obviously his reputation is and will be much greater than most of the fly-by-night condo developers who have disappeared, but his investors must be questioning his judgment regarding certain projects.

  49. during the boom he was playing with OPM at all stages, which in of itself was brilliant.

    e.g., icon, he didn’t own the land. he approached the owners, said this is how much it’s worth and instead of paying you now, you’re going to partner with me going forward based on the value of the land and you’ll make a ton of cash on the back end when we sell this thing out. they bought it hook line and sinker. now the prized several acre lot they had on brickell, on the water no less, returned ZERO to original owners.

    as for jorge’s investors (i’m assuming you’re talking about the folks who bought multiple units in all his projects), i don’t think any of them are looking to buy real estate soon (assuming they could afford to in the first place). but if they are, they’ll buy from him before anyone else. the guy has a following, right or wrong. i’m not a fan of his projects but the reality is, he’s the one developer down here i wouldn’t bet against (that’s not to say that related itself or particular projects don’t go belly up).

  50. Why does the Miami Herald run big stories like that without printing the names of those arrested? Wouldn’t the names be helpful?

  51. In addition to the credit crunch, the high property taxes in Miami is a big deterrent for many prospective buyers. This is a big issue for condos as vacancies tend to lead to increased maintenance costs. When coupled with insurance (which is now required for condos), taxes and the higher cost for condo credit, it will certainly take some time to get through the inventory we presently have on hand.

  52. Its a pretty simple calculation for Icon and Perez. The 2 bedroom apartment for 900k with a water view will be slashed to 720k in a year when the investors holding to the contracts back out. With the 20% deposit that they wiill give up, Perez will still get the 900k price he asked for in 2006, even when he drops the price to 720k for new buyers. Even if you think 720k is high in a year, when you add the 20% deposits he is keeping from all the initial buyers, he still has a very nice margin. The prices in this place might drop considerably in the future but that doesn’t mean Perez isn’t getting much more because of the walk outs. In fact I think Perez and Icon would rather have the initial investors walk out of their contracts and keep their deposits and market these places as GREAT DEALS in a year.

  53. if you want to see what is recorded with the county, do some research here:
    http://gisims2.miamidade.gov/MyHome/proptext.asp

    look for icon tower 1:
    465 brickell ave (15 units sold to non trg)

    and tower 2:
    495 brickell ave (according to the county website this is just 1 5 acre parcel)
    475 brickell ave (10 units sold to non trg)

    viceroy is listed as 485 brickell ave, but no results come up

    Note, the county website seems to be 3 months out of date.

  54. I am always very curious as to what will become of some of these buildings 20 years down the road. i.e. what kind of people, atmosphere, perception these bldgs will have 20 years from now? I mean lets not be too short sighted here. Right now things are bad but these buildings will be around for 50-60 years. Far longer than this downturn or even the next downturn for that matter…

    The bust will last 2-5 years but I just wonder what what people will be saying when they look at ICON 30 years from now…. will it still be empty? will it be a hot spot? will perez be looked at as flagler/fisher are now?

    You have to remember fisher helped froth one of the biggest busts in florida’s history. The Florida land boom ring a bell? (If I remember correctly I even think fisher died broke) And now he is looked at as one of the pioneers of Florida. At the end of the day perez/fisher/flager built infrastructure that has and will define our landscape.

    Food for thought.

  55. Dr Gonzo, I doubt that Perez will have an exclusive private island named after him nor will he have a multitude of companies and a street and a neighborhood (Flagler)named after him. Flagler practically founded Miami (and Fisher did Miami Beach) but both were known more for their advances/accomplishments in transportation-getting people to Fla.

    Throwing up a few residential condos doesn’t seem to compare…

    You raise an interesting question about what these buildings will be like in the future. Some, unfortunately, may not last long due to poor construction that I feel will be more evident as years pass. Others could turn into public housing projects (no sarcasm)….but for some reason its hard to envision some of these new condo towers still standing 60+ yrs without falling apart or becoming so dated that they are torn down and something else goes in its place. Considering the history of architecture/landmarks in this city, that is the most likely scenario.

  56. blowfish

    sorry, but your simple calculation is way off and in any event, the discount is going to be greater than 20%. at the end of the day, jorge ain’t making any profits on this project. it’s all going to the banks, to payoff their loans (at a loss to the banks).

  57. can’t really argue with someone who doesn’t understand the concept of capital structure, monthly expenses or lending terms.

  58. Funny, but a couple of years ago i stated you would get condos at 20% below preconstruction cost because the developer could still break even on the deal with another victim. People laughed and said “no way!” will prices ever fall 20% below preconstruction. Now they are arguing about how far below that price things may reach!

  59. Blowfish. You are delusional if you think Perez (or any developer) in a declining value market wants their buyers to drop contracts so they can keep their earnest money and sell the unit to the next buyer. Buyers walk away from hard money contracts because they would lose more money if they closed than if they didn’t. It’s that simple. Meanwhile, developers pay taxes, insurance, HOA, and interst carry on un-sold units. They also face the risk of class-action lawsuits if there is major buyer fall-out. Developers also have warranties, and those warranties timlines typically don’t even start until the sale closes. Developers don’t budget to staff projects for 5 years while waiting to sell the last unit. If prices have dropped 30-40% from the initial pricing, even if the project is 100% sold-out upon completion, the developer is making no money and is likely losing their equity.

  60. seems to me that if developers slashed their prices to half asking price, condos would fly off their shelves..
    2 bd for 800-1m at icon/900/marquis?? that’s insane..
    if they were talking 400k they would probably be making more deals..
    dont really see any good judgement in trying to hold on to these skyrocketting prices and be taking all the burdens on themselves..
    go figure!!

  61. The original sponsor (developer) has zero motivation to slash prices 50%. On most projects, once discounts get beyond 35% from original asking prices, the equity is gone. At that point, the project is simply waiting for the interest carry in the budget to get exhausted and then the lender takes over. Often this process is delayed yet another 6 months by the developer filing bankruptcy. But alas, the end result is always the same. Once the lender takes over, it takes them 6-12 months to figure out what to do with the mess they inherited. Meanwhile, values have dropped another 10%. Eventually, there is the Darwinian flush when the lender (often supported by the taxpayer), at the exact time they shouldn’t sell, decides to sell the project wholesale to an investor at 35 % of original asking prices (or 50% of their loan amount) and walk away. The investor then either a) sells them all at 50-55% of original asking prices within a very short period of time and makes a tidy profit, or b) leases them as apartments and sells the project 3 years later in a better market at a nice profit and gets cap gains treatment instead of ordinary income.
    This is the history of condo development. It happens every cycle.

  62. Drew,

    Perez pretty much built all of South of Fifth, Miami’s best condo neighborhood. He also built tons, probably the majority, of the buildings in Brickell. Brickell is Miami’s financial district and most important office sector. Hate the guy all you want but to say he “just threw up a couple residential condos” is ignorant.

  63. I promise you Jorge Perez will come out of all of this just fine. The guy’s a business and financial genius. He personal exposure in any one of these projects he built is small to zero. Like jcrimes said, he did it all with OPM…no personal guarantee, no personal exposure, just his rep. Joe Schmo took the risk and Joe Schmo lost out. If I were him, I’d walk away right now and spend the rest of my life partying and banging supermodels. But that’s what separates me from billionaires like JP….the only thing bigger than his bank account is his ego, so he’ll be around for a while.

  64. Back in Feb, Jorge wasn’t talking like a person who had no personal exposure to his Related properties going bankrupt. Wouldn’t be surprised to find out he was plowing his own money into some of these…

  65. Prices will fall until units are CASHFLOW POSITIVE. It could take 1 year or it could take 10 years. It’s like trying to resist gravity. Once it’s cheaper to buy than to rent for the number of years you want to reside in the unit, it’s time to buy. It’s so simple a monkey could understand.

  66. And if it is NEVER less expensive to buy than to rent then why buy? Just rent the unit for the next 5-10 years like people do in Germany or New York. Let the landlord take the monthly loss. My landlord loses like $700 a month on my property. He’s subsidizing my lifestyle $700/month! I use that money on booze and tramps. Thanks for the $700/month in booze and tramp money landlord dude!

  67. IF I correctly recall a news article from a while ago, Jorge Perez had the vast vast vast amount of his personal net worth in real estate. He like almost all other developers used Other People’s Money for his project BUT he didn’t have to sign a personal guarantee on those loans like almost all of the other developers had to do. That was the difference. Maybe he put in 10% (just saying, I don’t know) into a project, that is now gone as the loan is more than the property is worth BUT he doesn’t have to make up the difference with a personal guarantee. His error was not diversifying his wealth…a common but rookie mistake. When all is said and done, he probably will be left with his non-real estate holdings wealth. Smart, very smart, to avoid personal guarantees, but dumb, very dumb, to be in that position and still risk your wealth. Large $$$ and hubris is blinding.

  68. Marquis had 10 lit windows last night. Marina blue close to 60 (out of 340). Ten museum park had very few. 900 Biscayne looked the saddest with about 20 windows! 900 Biscayne looks abandoned compared to Marina Blue.

  69. Only time will tell on Icon and all the facts will come out in the coming months. It will likely become one of the biggest busts of the real estate crash, and eventually turn into a Flamingo-type cheap rental building.

    If he didn’t have a guarantee, then he had big chunk of equity in the deal.

    And just because he didn’t have a guarantee with his construction lender, does not mean he didn’t have guarantee with his preferred investors….

  70. Government spending skews GDP numbers. Wall Street bonuses will skew median household income. You can say the recession is over, but in reality that means nothing. Simply playing with numbers.
    70 percent of all trades on Wall Street are done by 2 percent of government supported companies.

  71. At 10 pm Friday, many people are out eating or movie or theater or party.

    So Marquis opened and no one says nothing?!!!! Lucas did a pictorial on Icon but the opening of Infinity, Epic, Everglades are all forgotten. Marquis and Paramount will face the same ignominy on these pages?

  72. The owners at Ten Museum were no doubt inside their Michael Capponi lounge sipping on martinins with supermodels waiting to be wist away to the south beach clubs that will cut the rope when they arrive.

    I’m sure all that stuff from the sales brochure was actually built and delivered as promised…

  73. I have yet to post in this blog but just wanted to point out the obvious. Lucas has created this blog (which I believe is great) as a vehicle to gain clients to sell units. I can make and educated guess that more than 90% of is clients or leads originate from this blog.

    Lucas mentions in the post above:
    “However, at the beginning of April, business began to show life again. In fact, activity has drastically improved to the point where 2009 could end up being one of my best years. I personally feel that the Miami condo market is within 2-3 months of reaching the bottom.”

    If he were to say that he personally feels that the Miami condo market is 2 to 3 years of reaching the bottom. HOW MANY CLIENTS WOULD HE HAVE ? HOW MUCH MONEY WOULD MAKE?

    You could say the same thing about the media and its advertisers

    The real question is:
    Since 2009 could end up being one of his best years, will Lucas invest his hard earned commissions in Condos in South Florida?

    I hate do be the bad guy, I do thank you Lucas for putting this blog together, I know its a lot of work.

  74. “At 10 pm Friday, many people are out eating or movie or theater or party.” — AJ

    Ha ha ha ha ha ha ha!! You sound like a Realtard ™ circa 2004, when I used to ask them why all the windows were dark in the Miami Beach high-rises.

    Anyway, did anyone see the new Miami Herald article regarding “superstar real estate agent” Carlos Justo? After supposedly being worth $20 million just 5 years ago, this guy is $20 million in debt, including $6 million to the IRS, but supposedly he’s still considered an r.e. guru. Unreal. Only in Miami.

    This guy has already lost like 5-6 major properties to foreclosure and doesn’t seem to care. Personally, I’d love to know how someone could amass so much in loans without breaking the law somehow, i.e., making misrepresentations on loan docs. I’m sure the local law enforcement will get right on it. Ha ha ha.

  75. Montura…

    You hit the nail on the head.

    I’m actually flying out to FL to check out the condo scene myself and am considering relocating from L.A.. There seem to be a couple (out of thousands and thousands of listings) decent deals out there (foreclosure and shortsales) if they could be aquired for 5-10% or so under asking.

    Of course Lucas blogs for exposure and customers…however….due to the fact that he wouldn’t answer any of the questions about issues that are decidedly bearish (such as those above questioning the number of closings at Icon) I can’t say I’ll be using his services.

    Then again, he’s so busy anyways.

    I’m sure there is no shortage of agents down there.

  76. Just for the record, I certainly would consider Lucas high on my list of real estate agents when it comes time to buy. Is he maybe a tad more optimistic then the market? Maybe, but if so he is not too far off the mark and for that he has my respect.

  77. AJ – Lucas – Whatever

    I hate to pile on Lucas but AJ and these others are correct. Where is the info on Epic – Icon – Infinity – Everglades ????. You have posted zero zilch nada about these buildings and your new graphs at the bottom of each tell us nothing – cannot decipher anything about them nothing is coherent.

  78. RT — I don’t know much about Lucas, but in this market, if I were a buyer, I’d skip the “buyer’s agent” altogether and arrange viewings on my own. Then, if it came time to buy, I’d tell the seller’s agent to knock 3% or 4% off the price, or go grab some hungry r.e. agent who’ll sign the papers for a 1% cut instead of 4%.

    This market is so flooded with units, unless some agent has an inside deal on wholesale pricing or something like that, using a buyer’s agent is like burning 3-4% of the sales price. On a $400,000 unit, it’s like giving $12,000 away just out of charity.

  79. let me be clear on jorge…he has no guaranty exposure whether at the senior or mezzanine level (according to my source at related). and although his “equity” in the later buildings is all blown to hell, he killed early on. is he worth billions? probably not. most developers, boom or bust, are generally real estate rich/cash poor. and most RT, never diversify (it’s akin to a doctor being his own worst patient)

    regardless of what happens, jorge is the number one guy down here and the banks know it. his rep alone has held the barbarians off at the gate and allowed him to effectuate workouts where he’s still making some cash in the deal (in management fees).

    Joe
    justo is bust because he went from doing something he understood (being a realtor) to something he had no damn clue about (developing). he wasn’t the only one. it was quite common in the boom for realtors, with their GEDs or beauty schoold educations thinking that they were real estate development moguls. the collapse exposed them all for the morons they were.

    as for the comission issue, best way to avoid the whole bitchy realtor protecting his/her commission is to get a buyer’s agent in place who’s going to split the commission with you on the back end. it’s annoying but it’s a necessary evil. frankly, and sorry lucas, only when it comes to significant properties do i see any value in having a realtor involved. in those cases, the avatar/sotheby’s/jills (and even justo back in the day) of the world add value, with the primary reason being that they’re more than just realtors….they’re full fledged marketing firms.

    finally, a sidenote. i was at the new W this weekend. damn nice. but can someone explain to me how the FB, Gansevort (sic?), Mondarian, W, Raleigh, Shore Club, Delano, Setai, Victor etc. are going to survive when they are all competing for the same tourist dollar? i would be curious to see the balance sheets of some of these operations.

  80. The real estate bubble, like the tech bubble, caused delusions….everyone thought they were geniuses when the “wealth” increases had nothing whatsoever to do with any of their skills at all. Rather, any idiot in that market made money no matter how stupid they were and no matter how many mistakes they made. Hence a realtor who shows homes thought that they could get into things like development, construction etc…..which are very different indeed. My favorite is the old show “Flip This House” where the flippers thought they were geniuses (the Montenego guy for example) or the now Real Estate Pros where Richard from Trademark Properties doesn’t realize that the weekend sell out of the apartment to condo conversion was a result of the mania, not his skills. It is an easy trap to fall into…..

    Note, tomorrow’s Miami Herald is to have an in depth story about the apartment to condo conversion mess……that is a ten year problem in my book to unwind and nothing could be worse other than a condo-hotel I suppose a la OBH. Should be an interesting read and one where you realize the human consequences of dishonest real estate people, mortgage brokers, and of course buyer greed.

  81. jcrimes,

    I talked about this before. I am getting to stay at the Bellagio, one of the most luxurious props for a mere $89/day this month. But try and search the dumps of FB, Gansevoort , Mondarian, W, Raleigh, Shore Club, Delano, Setai, Victor etc. and room rates range between $250 to $500/night. Absolutely no deals at all. WTF

  82. AJ,
    Vegas subsidizes the hotel and airline industry to get people into the city, where the real money is made from gambling. housing, food and travel are secondary moneymakers. this is not the case in Miami, where the tourist profit is made from hotels, food, etc directly. These hotels cannot set a precedent with lower prices because they could never raise them again without going out of business. They are in a truly precarious position.

    Looks like SoFlo may dodge a bullet as the hurricane season appears to be favorable to our location. Weather patterns are set up for a lighter season, thankfully. A repeat of 2004 and 2005 would have been devastating to the RE market.

    Not that i really respect the man, but did you hear Greenspan’s latest comments. He has worries that another leg down in RE is quite possible. Not a collapse like we have seen, but continued downward pressure from unemployment. I dont think he really buys into this recession is over and recovery in the second half notion. I dont either. I think we have a second, although shallower, dip in this recession. Will also happen in the stock market. This second leg down will be sure to shake out the remaining folks hanging on by a thread. Then the vultures will scoop in and lead the recovery.

  83. gables – I don’t buy the recession is over either. Where did all this debt and bad debt go? It actually still exists and is more and worse than before. The fed govt has taken over a lot of the debt then quadrupled it. No joke. As I have posted before, the fed govt can’t fill the credit bubble void. Moreover, the fed govt is soaking up most of the available capital the likes of which no one has seen….it crowds out private investment and debt to such a degree that its full effects are not knowable at this time. Even Wal-Mart had to shop bonds in Japan to finance its debt largely on account of the fed govt crowding out effect. Pay me now or pay me a lot more later…..just kicking the debt bubble down the road. Next time, there won’t be anyone to bail anyone out…..the fed govt can’t keep bailing itself out. Greenspan knows this.

  84. Hey geniuses. What’s going to happen to real estate prices when interest rates go up? Or are all the geniuses here predicting 2.5% prime rate and 0% fed rates forever? Hmm??? What do you all the economics professors on this board have to say about that?

    LOL!

  85. I don’t know what kind of lame ass is out partying at 10 pm, but I head out around 11-12. 9-10 m everyone is home getting ready or has people over. Also, I highly doubt 90% of residents at 900 Biscayne are out partying on Friday anyways. What about on Monday when like 20 people from MB take their dogs out on walks and like 2 people from 900 Biscayne do? Please. 900 Biscayne is freaking abandoned!

  86. jcrimes — I agree re: all of those high-end hotels. It seems like the most recent ones are about 10 years too late. Miami Beach still is an A-list destination, but it’s more and more residential and less and less tourist/party scene. Just as there’s a massive oversupply in condo units, it appears there’s a massive oversupply in high-end hotel rooms.

    By the way, how were you in the W? The Herald recently reported the property is off-limits to people who aren’t actually staying at the hotel, unless that’s just the excuse it uses for getting rid of any riff-raff that rolls through.

  87. I think the W is supposed to be “off limits” for non-hotel guests only during the day but the restaurant/bar/lobby is open to all at night.

  88. joe, gables, jcrimes,

    Couldn’t seem to find a room in Tides for less than $350-400. Victor is no different but it is a dump even after millions of $ of renovations. Same goes with Bentley Hilton or Marriott on the Ocean drive.

    I am not asking for $100 room rate here. Like $150-$175 or some such thing. But no chance, no way. That begs the question: who is staying in these rooms at these outrageous prices, especially in this economy? If no one is biting these rates and the rooms are empty why are they not discounting them to fill the rooms?

  89. I think some of the South Beach hotels refuse to lower rates for 2 reasons: 1) they don’t want to sacrifice image, i.e. they want to maintain a perception of exclusivity/luxury (whether its warranted or not, depending on the hotel), and 2) after taking into account the avg incurred costs to the hotel per guest, it may be more cost-effective to leave a room empty than charge a cheap rate.

  90. I imagine at 750K and above jumbo financing is not an option:

    “Housing is fast dividing into two markets: Sales of low- and moderately priced homes are picking up and values have stopped falling in some parts of the nation. But on the upper end, sales remain mired in a deep slump and price declines are expected to accelerate…. The divide between the mass market and the high-end — generally defined as homes that cost above $750,000 — partly reflects the effects of Washington’s housing-rescue plan, which is producing winners and losers.”

    High-End Homes Frozen Out of Budding Housing Rebound
    http://online.wsj.com/article/SB124924069909799645.html

  91. AJ, just because they are not offering rooms on the cheap does not mean they are filled up. Plenty of supply out there. They cannot offer cheap rooms because as a “luxury” brand you cannot offer $150 rooms today and then return to the $400 room once a recovery sets in. For those rooms to get cheap, the hotel will have to go bankrupt, which may very well happen, and the new entity will be in a better position to offer lower rates upon reopening. Fortunately for them, it takes far few rooms at $400 a night to keep the hotel operational so they may be able to squeek by with fewer guests. The problem for these hotels is we had a MAJOR readjustment of the supply-demand curve in the past couple of years. Only in the past months, as the economy begins to stabilize, will these businesses really see what the cost and occupancy rates will be in the foreseeable future.

  92. Even if real estate looks like a buy, taxes and insurance will be going up. Bulk buyers are going to get slaughtered. Buying hundreds of units that nobody wants if such a bizarre principle. Only in Miami can you sell that as a plus.

  93. #101 Totally clueless on macroeconomics. The federal government can create infinite amounts of money. Crowding-0ut is not applicable to modern fiat money. The only risk is inflation.

  94. The Miami Herald had three nice articles on apartment to condo conversion projects and points out that in Miami-Dade and Broward there were around 74,000 unit conversions (more than the number of new construction condos apparently) with at least 50% bought by speculators, many with no deposit requirements and apparently 100% financed with everything from option ARM payment loans to worse. It is an utterly hopeless quagmire for many many projects, esp with so many amateurs involved and now no one is running the asylums. It truly is a very very sad situation. I have met several people down here who bought a conversion unit and easily lost 2/3′s of value and many owners aren’t paying their HOA fees (and who is there to actually run the HOA anyway, and who wants to volunteer to be on the board….if you actually have condo knowledge and would be a good board member, then you’re smart enough to just cut and run like hell). One person that I have met paid $230K, now couldn’t sell for $90K if he wanted to. These things are utter and complete disasters. Very sad.

  95. bubbleRefuge – We know all about your kooky economics with the tin foil hats. Money represents wealth, there is not an infinite amount of capital/wealth that currently exists. Absent current inflation, the government has crowded out access to capital/wealth, period.

  96. RT, I had some involvement with a few condo conversions in Orlando 2005-2007. I saw 900sqft 2/2′s selling for $240,000 in early 06 and now these same units (after being foreclosed on) are being offered at $35,000. About an 85% drop.

    I never felt sorry for the investors/flippers/speculators who lost $$$ but to see working-class, young families and retired couples purchase these units with the intent to live in them (and realizing the dream of homewonership) is truly sad, considering that many will NEVER have any equity in that home.

    What’s funny is how easy it was for anybody to “become” a condo converted developer. No education, real estate or construction background needed…just enough $$ to get one of those 18-month condo conversion loans from Ocean Bank, apparently underwritten by baboons.

  97. JL

    Ha Ha. Thats an interesting link #111. Didn t the Miami Herald claim just the opposite in their front page article this past Sunday about high end Miami property? The Miami -Herald – one day the market is recovering and then a week later another article claims how bad things are. I wish that Monica Hatcher would make her friggin mind up.

  98. gables #113,
    That is what I am afraid of. A tourist backlash.
    Either you have semi decent props at $300 and up a night or you have closet sized roach infested, puke stained carpeted, garbage rooms for $100 a night. Miami is selling itself on an image and very little of other substance.
    It is time Miami starts competing with other cities in America including NYC (where you can actually find a very decent room in Midtown Manhattan for $100) in offering real service at a good price than just try to live off on a past image. People are smarter than that. Sooner or later they are going to say WTF, I can go to Puerto Rico for half of what I spend on a Miami vacation. You can sell Liv or Mansion only that much.

  99. #116 There is an infinite amount of nominal financial assets, i.e. , money that the government can create. The productive capacity of an economy has limits of coarse. However, at 10% unemployment, there is plenty of slack/unused capacity in our economy.
    Your crowding out argument is nonsensical; you have no idea what you are talking about.

  100. AJ,
    The concern i have is miami does not have much to offer beyond image. and service down here is terrible at best. this does not bode well for the future, unless the people of miami realize customer service is essential to maintaining miami as a tourist mecca and thus a way of life for millions of workers in soflo. not holding my breath.

    bubblerefuge,
    the government is indeed crowding out investment in private sector. they are offering billions (trillions in aggregate) of bonds (debt) which is being purchased by consumers. much much less debt is being offered and purchased by private capital. the large sums of money, both domestic and international, being gobbled up by the fed govt will have an impact on private business ability to grow over the short to intermediate term. dont confuse the governments ability to create money ad nauseum with investors ability to put it to work. unless the government continues to buy private debt, the money created by the government never gets into the system.

  101. While on the topic of the Aussie dollar, it is interesting,
    is it not, that where the US is suffering through a
    problem of too much housing and too weak prices, the
    Australian government is now having to deal with a
    very different problem: too little available supply of
    housing and prices that are too strong. Housing prices
    in Australia are rising, not falling, creating some
    problems for the government and headaches for the
    Reserve Bank. We’ll go into this in some length later
    this week, but suffice it to be said that the problems of
    shortages of housing in Australia are a harbinger of the
    same problem we shall have here in the US in a year
    or so, for housing starts have fallen to less than 0.5
    million annualised units, and historically that is simply
    not justifiable nor sustainable. Anything less than 0.8
    million annualised starts has been historically
    unjustifiable, and marked the turning point in the
    housing market here in the US in each of the
    recessions since 1958. A year or so from now the
    The US$ vs. Brazil’s Real: From 4.0 to 1.8 To the US$:
    The Love Affair With Lula Since ‘03’s Inauguration Is Relentless.
    headlines here in the US will be of housing shortages,
    not of housing excesses. That’s just the nature of such
    things cyclical. Australia’s shortage of housing is
    simply a leading indicator.

  102. Kramer-agreed-and to note the Heralds kudos and praise for her work effort in a recent article as well…While its true she is playing both sides of the fence atleast the stories are being exposed so that the real people who know can desipher and sift through all the BS..and luckily enough with so little now being built you can pick up a super shovel land mover real cheap!!

  103. The south beach hotel market is so small, they can probably get away with charging that. There just isn’t a big number of luxury rooms compared to other cities. Even Hollywood/Sunny Isles probably has more luxury rooms.

    For my taste, I would rather spend a week at the Westin in the US Virgin Islands for $169/night than the roach motels in south beach for the same price!

  104. Gables, thanks for attempting to make a cogent argument rather than name calling.
    Nevertheless you have it completely backwards.

    -The government doesn’t ‘gobble up’ capital when its sells bonds. I swaps one asset for another, i.e., a bank deposit is swapped for a treasury security deposit which nets to zero. Nothing is lost. The purpose of a treasury security is to drain reserves from the banking system in order to control the federal funds rate. Many people in the main stream are totally confused on this point.

    So where is the crowding out? If the bond-holder wants to buy a car, he converts his treasury security account back to a bank deposit account and buys a car. Crowding-out theory is a vestige of the gold standard when all money was pegged to a fixed amount of gold and lending is 100% reserve constrained. In this model, since the supply of money is finite ( ie fixed) and the ability to lend is thus constrained by gold reserves then government borrowing may crowd-out private investment. This is inapplicable in today’s floating exchange non-convertible monetary regime that most of the world uses.

    However, the government does ‘gobble up’ money when it taxes. It also creates new money whenever it spends and this money IS getting into the system but unfortunately it is not enough.

    you can learn all about it here http://www.moslereconomics.com ( great site for learning)

  105. I was driving home on the Macarthur Causeway last night and couldn’t help but notice the huge new neon rectangular/square light feature on top of Marquis last night. It looked kinda cool, but thought to myself…how long until the board shuts that down becasuse it is so bright and glares into the residents’ apartments. Again, looks nice, but functional? Hardly…

    Also, I was looking at a lot of the buildings going down 95 and couldn’t help but notice Marina Blue, Marquis and others with those hideous lights running down the backside of the building. Marina Blue is truly the worst. What a waste of energy and eye pollution. Makes the building look ugly. How could the city approve this crap?

  106. Is has Marquis opened up for occupation or not? Did they recieve a TCO? What the hell is going on with Paramount?

    At one time I could depend on this site for info….
    Why is that I have to come down to Miami once every 3 or 4 months, write reviews, happenings and let everyone know what is going on ?

    Lucas, I know that you are doing everything you could. But I expect something more than “Just found out Flo-rida is living in MB penthouse” in your Twitters. It was shocking for many of us that Epic, Infinity and Everglades recieved a TCO and started closings and you did not even let us know leave alone write a story on them.

    Is there not even one one guy or an RE guy in this forum who has the courtesy to let us know about what is going on? I know Samir chipped in a few times when I asked him questions but he has his own site and blog. Why should he do what I am asking him to do here? Very disappointing indeed.

  107. Dont get me wrong, I enjoy tidbits such as Flo-rida and Burn Norice being filmed at Icon’s Viceroy Spa. But matters of importance are being completely overlooked.

    Apart from lack of news regarding Marquis and Paramount, I also saw that 5th and Alton was ravaged by the flash floods in June. What happened to it? Are they opening soon (for all I know, they might already be opened and doing business and maybe I am at the wrong place to find about about such “useless” information). I wish someone posts such news here. After bobmiami website died, MCI became the only place to get info on Miami apart from ofcourse condo market. But that has not gotten any far as you can see.

  108. Lucas,
    While the tid bits are of a great entertainment value, they do not affect my breakfast menu.

    What is happening with Paramount will have profound effect on my prop as well as the entire Pace Park neighborhood.

    What is happening with Marquis can alter Miami RE market very significantly.

    5th and Alton can seriously affect a lot of us in SOBE and beyond and the traffic too.

    These are just 3 examples that came to my mind. There are tons of things that can have a big effect on all of us.

    I know you wrote a post about Bayview Market one time. If you are thinking that the only way you have to tackle a subject is by posting a new post, pls rethink. You can always add small info about things like this in your existing posts with out actually starting a new post exclusively to discuss such item. As a RE guy you are privy to a lot of info as you keep talking to the industry insiders. Without having to do a whole 9 yard post on Paramount, you could once in a while post a line here and a line there as to what is going on with that building and what is taking time in opening it and other such stuff.

    If not Lucas can anyone else do us (those who do not live in Miami) a favor by sharing information and not hoarding it?

  109. Ummmm… sorry, but most people don’t give a flying fuck about Pace Park or your (collapsing) property values.

    Information is power: Realtors understand that, especially in 2009 when so much information is readily available to the general public. Why should Lucas be obligated to publish worldwide valuable information on the fucking Internet? And I’m sure he’s privy to alot of insider information that is protected by confidentiality & non-disclosure agreements where his ass would be sued (again) if he started posting every rumor he heard.

    Closings are public record- go on the Clerk of Courts site and look em up yourself.

  110. 5th at Alton opens later this week. At least the Best Buy does. Not sure when Publix opens.

    That Marquis accent lighting is BRIGHT. Its glaring right into those upper PH units like a police spotlight.

    Maybe its to catch the suicide jumpers.

  111. AJ,

    Very good points. Lucas, surely you can give us an update and pics of 1) Marquis 2) Paramount Bay 3) Everglades on the Bay 4) Epic 5) Ivy 6) Infinity amoung others. These account for thousands of units and would be helpful to see this stuff rather than pics of the refrigerated section aisle of the new Publix.

    Regarding Maquis, there were about 20 units with lights on last night; unsure about TCO. The front entrance is blocked off/unfinished. Rock Resorts is supposedly opening a high end hotel there called Tempo. Looks very boutiquey….Samir’s pics really look great for this project of individual units. Of most the condos I’ve seen, this is probably the best in downtown Miami….I’d say slightly above 900 Biscayne in qualtiy.

    I drove by 5th and Alton shops last night too; looks more than a month out. No Best Buy sign is up so I doubt they’ll be opening this week. Really bad planning on Miami Beach’s part to have this as the entrance to SOBE. It is a monolith that towers over the surrounding area and is very unattractive. Can only imagine the headache nightmare traffic jams as this area it’s already on of the worst trafficwise in all of Miami…

    Another interesting development close to Brickell and soon to be accessible by the trolley is Miracle Maketplace. Only a 10 min drive from Brickell, its halfway done with stores like Bally’s, Bed Bath and Beyond, Marshalls, etc. Nordstrom Rack, DSW and Nike Factory store will open there soon….I’ve been and its not bad…well def be a draw as the entire downtown still lacks this kind of big box retail (with the exception of certain stores at Midtown Miami). You should check it out next time you’re down….

  112. who cares about these stores. Who the hell shops at best buy? You can purchase the same LCD TV from amazon for 33% less and no tax.

  113. The marquis neon light is cool if the residents somehow can’t see it special glass/mirrors?, but man, if they can see, that’s weak.

  114. Miami Beach, Best Buy has a flier for opening later in the week. Due to Miami Beach codes they won’t be allowed to have a glaring sign.

    Marquis is under a flight path. Maybe they got the white landing strip lights for a purpose.

    Miami Realtors are already driving armored cars with frequency jammers. Doesn’t show much faith that the market will rebound.

  115. AZ88 & AJ

    Ditto! Ditto! Ditto! Lucas blog here is in a serious decline. Information is non -existent. His unwillingness to even respond to the criticism speaks volumes. As someone else mentioned if you want information go find it yourself. The only thing keeping the blog going is contributions from the regulars. Sorry Lucas but its true.

  116. Are there any good vBulletin type forums for miami condos? someone should start one. easier to follow threads, insert pictures, etc.

  117. Sobe sand, AZ88, Wild Bill and Kramer,
    Tks for info/response.

    I wish lucas can be more responsive to the bloggers. I don’t care even if he never responds to me or my queries. At least if he takes some concerns of the bloggers into consideration, that will go a long way in securing the place of MCI among the netizens for a long time into the future.
    One advice I will give to Lucas is never rest or never take your followers for granted. Facebook came from nowhere and literally obliterated Myspace. It is good to remember that.

  118. Among other things, I am dreading the day 5th and Alton opens. On some days, I spend 15-20 minutes on MacArthur with out moving between Watson Island and the Alton Flyover. It might become an everyday thing or even worse on weekends. Looks like the city will make a killing on the tolls on Venetian causeway.
    I hope they tear down Alton flyover. It is actually causing more problems than solve them.

  119. AJ, I can’t believe you missed the opportunity to plug pace park. Or how Midtown was replacing Sobe as the hotspot to do you Target and Ross shopping! LOL

  120. MARQUIS has received their TCO and closings start next week……there is a brand new management & sales team on site…….they have a gorgeous product with insane views of the city, but they also know what a crazy difficult market they are in so are being as flexible as possible with potential new sales/closings……..We are planning on living on the 60th floor of this building, and hope for a bright future for both this project and the neighborhood at large……Any Miami Condo purchase of course has risk involved but if you really want to see risk take a look at a chart of the US Dollar or future GOVT borrowing needs…..Best wishes to all!

  121. Lots of animosity, and yes have to agree with all that sight is lacking content as more important were the facts and figures not the pics of trump as well as all the others recently added-

    As far as 5th and Alton can you say traffic jam-especially when and if they ever begin construction on Watson Island-better bring your beach chairs as the causeway will soon become a standstill…

    Mayfair Marketplace-reconstruction/resurection of a failed project, no one cared way back when no one will care now.

    Marquis TCO-Temporary certificate to operate so that the developer can pay off his loan before bankruptcy as you all know it will take months for completion-and for what to see the homeless in the street-try walking up the few blocks past Archt center to “enjoy “your new Urban neighborhood-GOOD LUCK, as I hope you take your Rotweiler or your revolver.

    Todays Miami Herald story-just another plug that the city has bounced back and created an Urban center—BS walk a block west and tell me what you see-want to buy some crack? Got a dollar for a spit window cleaning? And plug Pace Park its a doggie toilet!-but hey its better than Park West where its Camillas house…

    But hey it’s the Magic City afterall, and the fact that we can magically think that the problems arent there makes the illusion all that more marketable…Anyone wanna buy a cheap condo????

  122. I just came back from taking a peak inside Marquis. All I can say is wow. This will definitely be my new home after my lease is up at 900. I was not allowed to take pics but the quality and finishes are on par, if not above 900. I was very impressed.

  123. Marquis starting to close in a week! That is really news. Guys, pls keep posting what ever you find out. Swiss, Angel and Swindler, tks for chipping in.

  124. YES, there is A LOT of activity happening in Miami, as the swindler closed a few units last month and have even more pending for late summer/early fall so all abourd the great Miami express…Anyone care to ride…

    Marquis is looking good as just did the developers tour, the common areas are definately above average and developed knowing the issues of the previously delivered buildings-as “we didnt want to skimp like so many of the other buildings we are competing with”-Undisclosed ranking official on the project…

    Did not like the fact that I felt like I was sandwiched between TMP and the Highway as on the balcony you can so hear the traffic…

    Pool area was very windy and hot (obviously) even today with very little wind in the forecast making me wonder how it will be to utilize space when the wind is blowing…

    Of course great views of far away yet nothing to see close…oh other than and I counted at noon today 22 homeless people sitting, sleeping and or “living” under people mover at 11st and in the parking lots, which makes me question what will happen with the construction lot once Marquis is finished with it as again its still a blight with the building next to it on the 10th street corridoor.

    OK Paramount Bay, can you say 360′ difference in opinion-this is a monstrocity with many many issues that I forsee. The finishes are average at best and looks like corners were cut (as was the budget from this financially strapped developer). The common areas are no where near complete and if history serves correct this building team will once again fail to deleiver what the renderings, the sales materials and the promisses that were made at preconstruction-only to add to the cancelled contracts and foreclosures as who knows better than the swindler. As far as the commercial spaces, again same story, empty, empty, empty and will be despite once again my already commented on Herald article from just today on the Urban development in edgewater..

    So bottom line if you are keeping score sports fans add on another 2000 + units to the market, 10K non-filled commercial space, and what will surely be another bankrupt property. I wish them luck I really do, no really, but surely, remember what greed and shortcuts will only lead to…Oh the swindler knows but like you say some info is priveledged information, and wouldnt want to get sued along the way!

  125. the way things are going and with all these new units being poured into existing inventory, it seems that the 600k-1 M 2bd, will go very soon for 300k.
    prices are already collapsing at icon brickell, and I am sure they will even more..
    hold on a little longer and get more for your bucks!

  126. I got my closing scheduled for August 17th. God damn short sales take forever, but it looks like I’m finally in the home stretch!

  127. Since I referred to it twice today for all of those out of towners here it is…Remember its all smoke and mirrors and you know what we smoke and what is on the mirrors here in MIAMI

  128. there u go swindler..paramount with cheap finishings, claiming to be the ultimate luxury living and asking 1.2M for a 2bd? what are they smoking?

  129. Here is the email I got from Mark Zilbert, After filtering out the RE dribble, I am posting some of the email. OK, the last 2 paragraphs will get some of you to see red but just leave it alone. But my point here is that I appreciate Mark Zilbert giving me general Miami info apart from his usual RE stuff. That is the least I expect from any realtor.

    Aj,

    I’ve got a bunch of things to tell you about this week. Check these items out.

    BEST BUY OPENS IN SOUTH BEACH THIS WEEKEND
    The long-awaiting (ultra-cool) shopping complex at 5th Street and Alton Road in South Beach opens this Saturday morning. Its first tenant, BEST BUY, flings open its doors at 10am. According to a recent marketing piece, the first 50 people in the door get a $20 gift card.

    Soon to follow will be Publix, Staples, Ross, TJ Maxx and others.

    By the way, there is retail space available. Contact me if you would like details.

    W SOUTH BEACH OPENS ITS DOORS
    We are thrilled to see the W SOUTH BEACH open its doors and welcome visitors and guests. The buzz is that this will be the place to see and to be seen. The famous Living Room Lounge has been getting rave reviews, as has the overall decor. The legendary MR CHOW restaurant is slated to open this week.

    You can own a W HOTEL suite, with prices starting at about $770K and going up to about $5.5M. Use the suite when you are in South Beach, let the W rent it for you while you are away. It’s a great type of ownership plan.

    Contact me for ownership opportunity information.

    FIVE GUYS BURGERS AND FRIES NOW OPEN IN SOUTH BEACH
    If you haven’t tried a Five Guys hamburger, you have been missing out on something special. This Virginia-based company has been springing up all over the place, and has now landed in our back yard. Just one taste of their burgers and fresh-cut fries will make you a fan for life. The chain is even ZAGAT survey rated!

    Visit Five Guys at the corner of 15th Street and Washington Avenue.

    MIAMI SPICE DINING IN AUGUST AND SEPTEMBER
    Each summer, many of Miami Beach’s fine restaurants participate in this event. Each Miami Spice restaurant offers a fixed price dinner menu for $35 and a lunch menu for $22. One of our favorite new restaurants, RED STEAKHOUSE, is on the list this year! See which restaurants are offering Miami Spice: http://www.ilovemiamispice.com

    WEAK U.S. DOLLAR BRINGS SWARMS OF BUYERS TO MIAMI
    The plunge of the U.S. dollar has a lot of Canadians and Europeans dropping into Miami with shopping on their minds. And, this includes the snatching up of condos and homes, at drastically-reduced prices.

    The Wall Street Journal’s report on foreign exchange values, effective August 5, 2009 shows the following:

    $1 Canadian = $0.9347 U.S. — this is almost at par!
    €1 Euro = $1.4415 U.S.
    £1 UK Pound = $1.70 U.S

    MIAMI HERALD REPORTS ON THE RISE IN LUXURY HOME SALES
    I posted an inspiring story on my blog from the Miami Herald. It seems like high-end living is…well…high end again: http://www.zilbertblog.com

  130. Swindler,
    Thanks for the report on Marquis and Paramount.

    I have not seen the inside finishes but the pictures of the flat in Samirs website are outstanding. I dunno what to believe.

    As far as the retail area, what is the big surprise that they are all empty? Firstly the building is not even open.

    The waterfront Piazza and the mall is unlike anything I have ever seen anywhere in Miami. So we should reserve our judgment on Paramount for a little while longer until it is open to the public.

  131. Here is the email I got from Mark Zilbert, After filtering out the RE dribble, I am posting some of the email. OK, the last 2 paragraphs will get some of you to see red but just leave it alone. But my point here is that I appreciate Mark Zilbert giving me general Miami info apart from his usual RE stuff. That is the least I expect from any realtor.

    ” I’ve got a bunch of things to tell you about this week. Check these items out.

    BEST BUY OPENS IN SOUTH BEACH THIS WEEKEND
    The long-awaiting (ultra-cool) shopping complex at 5th Street and Alton Road in South Beach opens this Saturday morning. Its first tenant, BEST BUY, flings open its doors at 10am. According to a recent marketing piece, the first 50 people in the door get a $20 gift card.

    Soon to follow will be Publix, Staples, Ross, TJ Maxx and others.

    By the way, there is retail space available. Contact me if you would like details.

    W SOUTH BEACH OPENS ITS DOORS
    We are thrilled to see the W SOUTH BEACH open its doors and welcome visitors and guests. The buzz is that this will be the place to see and to be seen. The famous Living Room Lounge has been getting rave reviews, as has the overall decor. The legendary MR CHOW restaurant is slated to open this week.

    You can own a W HOTEL suite, with prices starting at about $770K and going up to about $5.5M. Use the suite when you are in South Beach, let the W rent it for you while you are away. It’s a great type of ownership plan.

    Contact me for ownership opportunity information.

    FIVE GUYS BURGERS AND FRIES NOW OPEN IN SOUTH BEACH
    If you haven’t tried a Five Guys hamburger, you have been missing out on something special. This Virginia-based company has been springing up all over the place, and has now landed in our back yard. Just one taste of their burgers and fresh-cut fries will make you a fan for life. The chain is even ZAGAT survey rated!

    Visit Five Guys at the corner of 15th Street and Washington Avenue.

    MIAMI SPICE DINING IN AUGUST AND SEPTEMBER
    Each summer, many of Miami Beach’s fine restaurants participate in this event. Each Miami Spice restaurant offers a fixed price dinner menu for $35 and a lunch menu for $22. One of our favorite new restaurants, RED STEAKHOUSE, is on the list this year! See which restaurants are offering Miami Spice: http://www.ilovemiamispice.com

    WEAK U.S. DOLLAR BRINGS SWARMS OF BUYERS TO MIAMI
    The plunge of the U.S. dollar has a lot of Canadians and Europeans dropping into Miami with shopping on their minds. And, this includes the snatching up of condos and homes, at drastically-reduced prices.

    The Wall Street Journal’s report on foreign exchange values, effective August 5, 2009 shows the following:

    $1 Canadian = $0.9347 U.S. — this is almost at par!
    €1 Euro = $1.4415 U.S.
    £1 UK Pound = $1.70 U.S “

  132. OK Mark Zibert, sell me a condo-hotel at the W. “Its a great type of ownership plan.” As we all know that is an outright lie. What an asshole.

  133. That Dilbert email was pretty pathetic. As if Best Buy is going to last selling flat screens and cell phones. That market is so 2007. More cell phone shops on Washington and Alton will go under. More empty retail.

    Five Guys took over the Dogma Grill spot which didn’t survive more than a few years. I’ll give that spot two years. It’s also across the street from another burger joint.

    When you buy a condo hotel or time share you’re required by the contract to renovate your unit when ever the contract stipulates. A complete scam.

    Swarms of people buying Miami condos. What a joke.

  134. “You can own a W HOTEL suite, with prices starting at about $770K and going up to about $5.5M. Use the suite when you are in South Beach, let the W rent it for you while you are away. It’s a great type of ownership plan.”

    - Oh my gosh….couldn’t stop laughing!!! Oh but you get the pride of ownership. Hahahahahaha.

  135. LoL, I knew you guys are going to rip dilbert apart. Condotels are a big joke. Only the most idiotic will think otherwise. Remember timeshares of the yore?

    Anyway, I prefer the burgers in that joint between Madonna and Cameo on Washington. Five Guys? I am not so sure. They are also in the Midtown shopping center. No big deal at all. But the 8 oz burgers are doing well in the old Novecento spot on the Alton and 9th.

    But the publix coming up at 5th and Alton will be godsent if I ever decide to live in SOBE as I can walk to it. Even if I live in Pace Park, that will be very convenient if they are going to comp my parking, I will go there to shop instead of the 50th st publix (ghetto publix) or the MBV publix. I wonder what are the parking charges in 5th &A going to be. Will it be free for the first hour like the Midtown Mall?

  136. Hey…..I have noticed that the recent sales and recent rentals hasn’t been updated since the end of June….or at least for the buildings I looked at. Any chance of getting those updated….need to gauge activity! Thanks!!!!!!!!!!!!!!!!!!!!!!!!!!

  137. 5th and Alton…

    “Soon to follow will be Publix, Staples, Ross, TJ Maxx and others.”

    Who’s the brainiac that thinks Ross and TJ Maxx need to be within walking distance of $500-$1,000 sq/ft condos.

  138. JL,
    you will be sadly surprised.

    I spent a little time in the lobby of Waverly a while ago. I could not help notice the number of people coming back to their flats with a bag of Pollo Tropical (Alton and 15th). Now why would someone living in million dollar flats (at that time) buy food from a place frequented by homeless people and $2.99 lunches? I posed that question on this forum and someone joked “after spending their last dime on the monthly payments for their flat, they have nothing left for anything else”.
    But jokes aside, people with money always shop at the best value stores, discount stores and compare prices. It is only the stupid that throw money at designer labels and high end stores. That is how the rich stay rich and the idiots stay poor.

  139. And BTW, on my last trip, I shopped at the Marshalls in Midtown and also at the Marshalls behind 50 Biscayne and took home quite a few designer label jeans, swimming trunks, t-shirts, shirts, shorts and all each costing $50 and over in regular stores for $14.99 each. No one in New York could tell the diff.

    I say, bring it on (More TJ Maxx, Century 21, Marshalls and other discount stores).

  140. HAHAHA! MIAMI NEEDS MORE ROSS STORES? What the heck is AJ freebasing? Everyone I know is SHOCKED at the number of Ross, Marshalls, and other garbage fore less stores in Miami.

    Lets just say AJ is belongs to a group of people known for being insanely cheap.

  141. Please Ross, open a store inside my condo unit. The 0.5 miles I have to drive to get to 3 of your stores is way too far!

  142. Your house just lost 50% of its value, no reason not to shop at a place that sells clothing at 50% off.
    Sales data for July…looks like some people are still buying units in troubled buildings. It never ends in Miami.

  143. Guys without 2 pennies making fun of discount stores!

    That aside, looks like you gullible guys completely bought the Miami Beach = Luxury bullshit. No wonder the roach motels are getting away by charging $$$, holes in the walls charging $25 Martinis and you guys are dropping your pants and telling them to take what ever they want. Serves you right.

  144. And Wild Bill is totally correct whether he was sarcastic or not. “Marshalls, TJ Maxx and Ross are the new hot spots. Dollar General will replace Gucci soon.”

    Cheap is the new chic. I will bet my last dollar that the discount stores at 5th & Alton will do better than any other store on SOBE.

    And BMW, Call me cheap or call me whatever, at the end of the day, I have 3 fully paid off flats (and 1 more on the way to getting paid off very soon) and 2 convertibles, 1 sports coupe, 1 SUV and money in the bank. You are still in a rental and driving a dodge.

  145. Its not about Miami Beach = Luxury. Its about the anti-commercial, anti-chain mindset of MB residents and businesses coupled with snobbish/trendy/elitist viewpoints. The fact that you now drive across the causeway and see the Ross/TJ Maxx corporate logos is very ironic.

  146. Drew, very true. Let them get a dose of reality. Life is not all about $1000 bottle service in a curtained booth on borrowed money.

    If Miami loses its false veneer and sheen as an extravagant velvet roped destination, I will not shed a tear. I know that at the end of the day, it is one of the most beautiful locations in America and gorgeous beaches and weather (except summer). So if people want to come to Miami and lay their anchor for that and not for all the wrong reasons, it is most welcome.

  147. There is a lot of sales activity in troubled buildings. In fact it is so active that it is almost impossible to get them. they are usually being rented very quickly. Obviously we are not talking about financing. All has to be cash, above asking prices since these deals get multiple bids.

    I am expressing my opinion. I am just telling the facts. I have mixed feelings about it. On one hand if the current situation will get more stability in 1 year then these are very good deals and can bring decent return. If the situation will produce the second wave of meltdown then the return on money is not going to be worthy. Who knows?

  148. Lara is the last and only person on the blog that actually believes that using a Miami condo as an investment vehicle is a good idea. Good luck, sweetie.

  149. the burger joint is cheeseburger baby and it’s better than five guys. probably some of the better wings you’ll find on miami beach as well.

    since we’re talking food, and this thread has gone every which way…i’ll list my favorite places on the beach to grab food under $30

    1. jimmy’s kitchen
    2. le sandwicheria (sic?)
    3. baire’s
    4. cheeseburger baby
    5. take out at joes
    6. rio grande (? it’s the place next to sushi samba)
    7. sushi siam
    8. piola’s
    9. quarterdecks
    10. epicure (the prepared stuff)

  150. jcrimes,
    check out porto sagua on collins and 7th. The pollo guisado with yellow rice and the palomilla steak with white rice and Yuca in Garlic sauce is to die for. $9.95 and $11.95.

  151. I have to hand it to Lara….. I looked up the info on one unit she had mentioned and she sold it higher than the purchase price. Good job. It all comes down to the price you bought it at….and she bought it at a really really good price. So, if my info is accurate and looked at the correct unit…she did well and for that….respect. As the saying goes, you make money in real estate at the time you buy it since that is really the only time you have control….both in if you want to participate in this market/asset and at what price. Once that it is done…the market determines the rest and it is out of your control.

  152. Another blow to the SFH market……

    some State Farm premiums to rise 28 percent, say Florida regulators. They are getting rid of special discounts. T.J. Maxx here we come.

  153. I look at that chart Lara posted and all I see is a lot of ugly. (And what I don’t see are many, or any, sales in the high-end buildings, which means, as the prices of high-end units fall, the current “good deals” aren’t really as good.)

    I’m still looking forward to making Miami my permanent home, but good luck to anyone buying right now.

  154. AJ
    i’ve eaten there and it’s definitely good. just not in my top 10. also, forgot to add the falafel place on 6th, in between collins and ocean. bad ass but rarely go there because it’s shut down on friday

    and to get back on topic, there is something huge brewing in the world of high end properties in miami/FLL can’t disclose the project/projects, and don’t waste my time asking for more, but i will say this much: first, i was utterly shocked to hear it told to me even though part of me knew something must be brewing; second, it’s not perez and third, if there is a collapse, it means everything a notch below which was completed around the same time has a really dark future. we’ll know in the next 3 to 6 months.

  155. The Brazilian bar and grill in the 900 Biscayne retail space is now open. I will check it out tomorrow and report back.

  156. “second, it’s not perez and third, if there is a collapse, it means everything a notch below which was completed around the same time has a really dark future. we’ll know in the next 3 to 6 months.”

    I would have ventured Everglades but it seems jcrimes is suggesting something pricier. Regardless, if any quality building fails, it’s going to affect the whole market without a doubt. You really need some panic to establish a bottom. The dragging out of foreclosures is just delaying the inevitable so maybe a spectaular building failure can get us there in a year as opposed to waiting 3 years.

  157. Lucas #188- There are flyers all over the 900 Biscayne mailroom saying it is open. 900 residents even get a free drink with any meal during the month of August. I will drop by today and let you everyonw know for sure. Stay tuned!

  158. Lucas it is open I just had lunch there. Good size portions, reasonable prices and a killer free caipirihnia. You should check it out.

  159. I know first hand that these figures CANNOT be correct. Yesterday I viewed several units at Midtown 2 and 4 and Midblock. The agent for the developer told me that everything is for sale, but hardly anything is listed on the MLS. I have noticed the same scenario with other buildings such as Icon Brickell, Paramount Bay, Marquis, 900 Biscayne, Marina Blue and numerous other buildings. The developers appear to be hiding their inventories from the MLS. Which totally screws with the real figures. There are obviously a lot more available properties out there than they want you to believe. Seems like there are some dirty tricks continuing to go on in the real estate market in Miami. Its these type of games played by developers which got the city into this mess.

  160. I’m looking to stay in Miami Beach for about 6 months starting October, helping a friend with his business.. so need to rent a condo for 6 months. Since you guys are experts here, can you suggest a couple cool places to look at? 28 yrs old and coming from Europe.

    Thanks in advance

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