100 Condos Under Contract at Quantum on the Bay to Israeli Investment Group

Yesterday, a rumor was circulating that 100 condos recently went under contract at Quantum on the Bay to an investment group from Israel in a bulk sale transaction.  I was able to confirm today, from multiple sources, that the rumor is true.  However, everyone is keeping quiet in regards to the details involved in the bulk sale transaction.  It will be interesting to learn the price per square foot that the 100 condos sell for at Quantum on the Bay once the details are revealed.

(hat tip to Kevin at South Beach Real Estate Blog for the lead on the story)

Distressed Condos Report – New Condo Developments

The spreadsheet below reveals 13 distressed condos currently listed in the MLS which reside in developments in Miami completed within the past two years. I expect this list to grow in coming months. I plan to provide future updates with new listings as well as track the outcome of condos previously listed. 12 of the 13 condos listed below are short-sales. The foreclosure process can be quite lengthy so I don’t expect to see many distressed condos in new developments become bank owned until at least the second half of the year.

View Full Spreadsheet

New Fannie Mae Guidelines Turn Off the Lights on the Florida Condo Market

In December, Fannie Mae established new lending requirements for condo developments located in Florida which went into effect January 15, 2009.

Some of the updated lending requirements are as follows:

• Up from 51 percent, FNMA will now require that at least 70 percent of the total units in a condominium project must be conveyed or be under a bona fide contract for purchase to principal residence or second home purchasers.
• New and established condominium projects may have no more than 15 percent of the total units in a project be 30 days or more past due on the payment of their condominium/association fees.
• New and established condominium projects with more than 20 units will be required to have fidelity bond/fidelity insurance.  It was formerly only required of new condominium projects.
• Borrowers must obtain a “walls-in” insurance policy unless the condo development’s master policy provides the same interior unit coverage.
• No more than 20 percent of the project’s total square footage can be used for non-residential use.
• No more than 10 percent of the total units in a condominium project may be owned by a single entity (the same individual, investment group, partnership or corporation).

The new guidelines are a train wreck to an already crippled Miami condo market but a godsend to vulture funds.  Step aside and let the bulk buyers clean up the mess.  They will effectively push the reset button and create a floor to a condo market that would otherwise take much longer to reach.  The guidelines set by FNMA will have a negative impact on established condos as well. Prices there will take longer to fall into place relative to the pricing established by future bulk sales.  Foreclosures will climb in established condo developments until an equilibrium of supply and demand is reached.  However, as one person commented in a discussion about this topic, the market will likely first overshoot to the bottom.   With very restrictive financing policies, true demand will not be represented as those with cash will comprise the large majority of the buyers.  Keep in mind that bulk buyers will either need to hold over the long run or resell the condos to cash buyers themselves due to the rule that no more than 10 percent of the condos can be owned by a single entity.

To get an idea of which new condo developments in Miami will be affected, read my latest condo closing rates published in December.

Ten Recent Multi-Million Dollar Condo Closings in Miami – January 2009

The following are 10 luxury condos that have closed in Miami-Dade County since December 1, 2008:

1. Bayview at Fisher Island – Unit 5031/5032 – 3 bedroom/4.5 bath (6,830 square feet) – This condo sold for $5,600,000, or $820 per square foot, on December 11, 2008.
2. Apogee South Beach – Unit 1703 – 3 bedroom/3.5 bath (3,100 square feeet) – This condo sold for $4,125,000, or $1,331 per square foot, on December 4, 2008.
3. Grand Bay Residences – Unit PH2B – 3 bedroom/4 bath (3,625 square feet) – This condo sold for $3,619,000, or $998 per square foot, on December 29, 2008.
4. Villa Del Mare – Unit 7255 – 3 bedroom/3.5 bath (3,140 square feet) – This condo sold for $3,400,000, or $1,083 per square foot, on January 5, 2009.
5. Fisher Island – Unit 7652 – 3 bedroom/3.5 bath (2,950 square feet) – This condo sold for $2,950,000, or $1,000 per square foot, on December 19, 2008.
6. Bellamare – Unit PH1 – 5 bedroom/5 bath (6,663 square feet) – This condo sold for $2,600,000, or $390 per square foot, on December 15, 2008.
7. Grovenor House – Unit 2301 – 4 bedroom/5.5 bath (4,026 square feet) – This condo sold for $2,250,000, or $559 per square foot, on December 12, 2008.
8. One Bal Harbour – Unit 208 – 3 bedroom/3.5 bath (2,681 square feet) – This condo sold for $2,202,500, or $822 per square foot, on December 22, 2008.
9. Akoya – Unit TS03 – 3 bedroom/4.5 bath (3,377 square feet) – This condo sold for $2,070,000, or $613 per square foot, on December 30, 2009.
10. Murano at Portofino – Unit 3202 – 3 bedroom/3 bath (2,618 square feet) – This condo sold for $2,050,000, or $783 per square foot, on December 5, 2008.

Ten Museum Park HOA Fees Increase About 36%

Earlier this afternoon, I confirmed with the management office of Ten Museum Park that a significant increase in the monthly homeowners association fee was approved towards the end of December.  The new monthly HOA fee, which is now in effect, increased from approximately 55 cents per square foot to approximately 75 cents per square foot.  This represents about a 36% increase in monthly dues for condos owners of Ten Museum Park.  This is something that potential buyers need to be aware of since I found only one or two listings in the MLS that stated the correct monthly HOA fee.

With the exception of Jade, Solaris at Brickell Bay and Emerald at Brickell, which have each been burdened with a high number of foreclosures, I can’t think of another major condo development in Miami built within the past decade that has such a high HOA fee.  Ten Museum Park is a boutique condo development with only 200 units, which may be where the problem lies.  Most of the new condo developments in Miami have over 400 units and can divide their monthly expenses among more condo owners.  While the overall monthly expenses for larger condo developments may be greater, my assumption is that the costs for condo expenses such as staff salaries, building insurance and maintenance of the condo building and amenities is proportionally much smaller.

Miami & Miami Beach Condo Trends – January 2009

I decided to once again publish the condo inventory and months of supply figures for Miami, Miami Beach and Miami-Dade County as a whole. You’ll notice, however, a few changes to this update. One, you’ll now find viewable spreadsheets. This will make it easier to view the figures without needing to squint your eyes. Click on the View Full Spreadsheet link below each to view it in its entirety. Two, I’ve added pie charts to provide a quick picture as to which price range the condo inventory and closed sales reside. For some reason, however, Google Docs did not allow me to add percentage labels. Three, I calculated the months and years of supply figures using an average of six months worth of closed condo sales.

Below, you will find the Miami-Dade County condo inventory and supply figures for January 2008:

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.):

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

I hadn’t previously used a 6 month average to calculate the months and years of supply figures so it’s pretty meaningless to compare this month’s update to previous ones. However, here is the last update published in October 2008 if you’d like to compare the raw numbers.

2 Bedroom Foreclosure at Latitude on the River – $266,000

Within the past three months, I’ve seen a handful of short-sale condos at Latitude on the River become available on the MLS.  Earlier today, however, I came across the first bank-owned foreclosure condo in the building to appear.

The foreclosure condo is a 2 bedroom/2.5 bath with 1,212 square feet of interior and a 196 square foot balcony.  The condo comes “decorator-ready” with concrete floors, as delivered by the developer, and is located on the southwest corner of the 20th floor.  The list price is $266,000, or $219 per square foot.  The most recent Brickell Condo Index published in November 2008 revealed that the average list price of condos available at Latitude on the River was $366 per square foot.  There had not been any closed sales in the building at the time within the prior six months and there haven’t been any since.  Lack of closed sales clearly means that prices of available condos at Latitude on the River haven’t yet fallen to a level that will attract buyers.  It’ll be interesting to see if the 2 bedroom foreclosure condo at Latitude on the River will spark the interest of buyers.

View the pictures and listing information for the 2 bedroom condo foreclosure at Latitude on the River.

Marina Blue Bulk Sale – A Closer Look

As many of you have already heard, a 60-unit bulk sale recently occurred at Marina Blue.  Two local newspapers published articles about the deal earlier this week.

An investment group, under the name Welcome Bay LLC, paid slightly over $13M for the 60 condos.  The transaction was recorded on December 24, 2008.

The 60 condos included in the Marina Blue bulk sale sold for an average price of $200 per square foot.  Below, you will find the bulk condo sale separated as per the 60 recorded deeds.  As many of you have discussed in a previous post about the Marina Blue bulk condo sale, it is important for everyone to realize that these are not retail prices.  An individual cannot and will not be able to purchase condos at Marina Blue at these prices.  The 60 condos below were part of package deal with prices that were distributed accordingly to arrive at the $200 per square foot average.

Correction: I just found out that there was an error in recording the deeds with the county.  Each unit was sold for exactly $200 per square foot.

• Unit 411 – $169,000 – 845 SF – $200/SF
• Unit 610 – $169,000 – 845 SF – $200/SF
• Unit 703 – $196,400 – 982 SF – $200/SF
• Unit 810 – $169,000 – 845 SF – $200/SF
• Unit 911 – $169,000 – 845 SF – $200/SF
• Unit 1111 – $169,000 – 845 SF – $200/SF
• Unit 1511 – $169,000 – 845 SF – $200/SF
• Unit 1703 – $188,600 – 943 SF – $200/SF
• Unit 1801 – $263,000 – 1,315 SF – $200/SF
• Unit 1802 – $168,600 – 843 SF – $200/SF
• Unit 1812 – $263,600 – 1,318 SF – $200/SF
• Unit 1901 – $263,000 – 1,315 SF – $200/SF
• Unit 1906 – $189,600 – 948 SF – $200/SF
• Unit 2007 – $166,600 – 833 SF – $200/SF
• Unit 2009 – $264,600 – 1,323 SF – $200/SF
• Unit 2012 – $263,600 – 1,318 SF – $200/SF
• Unit 2104 – $241,600 – 1,208 SF – $200/SF
• Unit 2106 – $189,600 – 948 SF – $200/SF
• Unit 2202 – $168,600 – 843 SF – $200/SF
• Unit 2204 – $241,600 – 1,208 SF – $200/SF
• Unit 2312 – $263,600 – 1,318 SF – $200/SF
• Unit 2404 – $241,600 – 1,208 SF – $200/SF
• Unit 2503 – $188,600 – 943 SF – $200/SF
• Unit 2512 – $263,600 – 1,318 SF – $200/SF
• Unit 2709 – $264,600 – 1,323 SF – $200/SF
• Unit 2805 – $239,600 – 1,198 SF – $200/SF
• Unit 2903 – $188,600 – 943 SF – $200/SF
• Unit 3002 – $168,600 – 843 SF – $200/SF
• Unit 3201 – $263,000 – 1,315 SF – $200/SF
• Unit 3202 – $168,600 – 843 SF – $200/SF
• Unit 3304 – $241,600 – 1,208 SF – $200/SF
• Unit 3306 – $189,600 – 948 SF – $200/SF
• Unit 3401 – $263,000 – 1,315 SF – $200/SF
• Unit 3404 – $241,600 – 1,208 SF – $200/SF
• Unit 3405 – $239,600 – 1,198 SF – $200/SF
• Unit 3407 – $166,600 – 833 SF – $200/SF
• Unit 3412 – $263,600 – 1,318 SF – $200/SF
• Unit 3509 – $264,600 – 1,323 SF – $200/SF
• Unit 3704 – $241,600 – 1,208 SF – $200/SF
• Unit 3804 – $241,600 – 1,208 SF – $200/SF
• Unit 3901 – $263,000 – 1,315 SF – $200/SF
• Unit 3905 – $264,400 – 1,322 SF – $200/SF
• Unit 3909 – $264,600 – 1,323 SF – $200/SF
• Unit 4002 – $168,600 – 843 SF – $200/SF
• Unit 4105 – $239,600 – 1,198 SF – $200/SF
• Unit 4107 – $166,600 – 833 SF – $200/SF
• Unit 4204 – $241,600 – 1,208 SF – $200/SF
• Unit 4212 – $263,600 – 1,318 SF – $200/SF
• Unit 4303 – $188,600 – 943 SF – $200/SF
• Unit 4305 – $239,600 – 1,198 SF – $200/SF
• Unit 4307 – $166,600 – 833 SF – $200/SF
• Unit 4407 – $166,600 – 833 SF – $200/SF
• Unit 4409 – $264,600 – 1,323 SF – $200/SF
• Unit 4504 – $241,600 – 1,208 SF – $200/SF
• Unit 4506 – $189,600 – 948 SF – $200/SF
• Unit 4601 – $263,000 – 1,315 SF – $200/SF
• Unit 4705 – $239,600 – 1,198 SF – $200/SF
• Unit 4807 – $166,600 – 833 SF – $200/SF
• Unit 5006 – $189,600 – 948 SF – $200/SF
• Unit 5106 – $189,600 – 948 SF – $200/SF

Brickell on the River South Closeout Sale

I received an email earlier this week about a developer closeout sale at Brickell on the River South.  Prices of units include flooring and paint.  The sale will open to the public January 14, 2009.

The ad states that they have “a limited amount of one bedrooms from $180,000 and two bedrooms from $213,000”.

Top 5 Miami Distressed Condo Sales in December 2008

Sorry for the long hiatus. I’m back from my long vacation and ready to get back to work.  Below, you will find what I believe to be the five best condo deals of the 36 distressed sales that closed in the month of December in the MLS located in Brickell, Brickell Key, Downtown Miami and the Arts District.

1. Four Seasons Residences – unit 3305 – 1 bedroom/1 bath (611 square feet) – This unit sold for $285,000, or $466 per square foot, on December 3, 2008.  Foreclosure
2. Carbonell – unit 701 – 1 bedroom/1.5 bath (1,031 square feet) – This unit sold for $215,000, or $209 per square foot, on December 19, 2008. Foreclosure
3. Three Tequesta Point – unit 1605 – 2 bedroom/2 bath (1,694 square feet) – This unit sold for $465,000, or $275 per square foot, on December 3, 2008.  Foreclosure
4. Blue Condominium – unit 2310 – 2 bedroom/2 bath (1,174 square feet) – This unit sold for $330,000, or $281 per square foot, on December 1, 2008.  Foreclosure
5. Cite on the Bay – unit 3502 – 3 bedroom/2 bath (1,398 square feet) – This unit sold for $230,000, or $165 per square foot, on December 10, 2008.  Short-sale