The Lebron Effect on Downtown Miami Real Estate Prices
June 22, 2012 by Lucas Lechuga
It has been a long and winding road but the Miami Heat accomplished Thursday night what they had set out to do in July 2010 - to win an NBA championship. The Miami Heat defeated the Oklahoma City Thunder 4-1 in the NBA Finals to become the 2012 NBA champions. In all honestly, the Miami Heat obliterated the OKC Thunder and made a mockery of them - but we won't go there. Few would refute that LeBron James, the Most Valuable Player of the 2011-2012 season, was the most contributing factor which allowed the Miami Heat to raise the NBA trophy Thursday night for only the second time in franchise history. LeBron James' decision in July 2010 to take his talents to South Beach single-handedly changed the landscape of the league and set forth in motion an inevitability that no one outside of Miami wanted to see.
James' arrival in the summer of 2010 was celebrated not only by die-hard Heat fans but also anyone with any type of business or property interest in the city. His announcement was seen as a godsend to the hotel and tourism, restaurant and real estate industries throughout Miami. The area most positively impacted by LeBron James' decision to join the Heat was most certainly Downtown Miami, the neighborhood immediately surrounding the Miami Heat arena. Prior to James' arrival, property values in Downtown Miami had endured several years of double digit price declines. Furthermore, retail spaces and hundreds of condominiums within walking distance of the arena sat completely empty. However, that was all about to change.
Within days of James' announcement, there were reports of buyers snatching up condos in the area in a flurry of excitement. As a result, developer inventory began to dwindle and Miami real estate prices started to recover over the subsequent months. Since LeBron James' decision in 2010, real estate values in Downtown Miami have increased over 20 percent. Additionally, across the street from the arena, several new businesses - such as a pizza restaurant, wine bar, Chinese restaurant and sports bar - have opened their doors. One could argue that James' arrival played an instrumental role in the real estate recovery seen in Downtown Miami in recent years.
Correlation does not imply causation.
While there’s no denying the downtown values have increased, correlating that uptick to LeBron James’ arrival is a poor argument. What about greater market forces that caused the uptick?
Your “supporting documentation” is a silly article from MNT that casually references 2 rich guys who calim they bought near AAA b/c of LeBron. That’s hardly justification for a “LeBron Effect.”
Have to agree with Drew. The overall economy had already bottomed and was slowly on the upswing when Lebron announced he was coming to town. By your logic, Lucas, if Lebron had decided to take his talents to south beach in 2007, then we would not have had a housing crash in Miami!
Oh, this is not your best article Lucas! And believe me, I’m a huge fan of our team, and in a certain perspective Downtown, commercially, has been positively impacted. But because of way your expose your article, it’s almost funny!
Wow, so the economy had bottomed prior to July 2010 and was already on the up swing? I recall saying that AT THAT TIME and getting hammered for it. But at the time people here were still claiming the sky was falling. The first time home buyers tax credit was ending, interest rates were going to spike to 6%, etc., etc. I don’t think Lucas is saying that Lebron caused the upswing, but rather that he was one of the contributing factors to it. The hotel industry has done spectacular in downtown. Let that sink in for a minute. Of… Read more »
Juggernaut sport team does endow the host city with the aura of superiority.
Chicago was steadily losing population since the mid-1950s, with the only exception being 1990s, the era of Michael Jordan. Population rose 4% during that time. After Bulls’ winning streak was over, the city’s decline has resumed.
So if the Heat keeps on winning, it will definitely benefit Miami, and Park West area in particular.