Miami Condo Developers Slash Prices on Existing Inventory
It’s no secret that most condo developers in Miami are still left with a large supply of unclosed condos. These developers pretty much have three options: (1) Do nothing and continue to bleed money by paying interest on the outstanding debt, (2) Sell condos in bulk to a vulture fund at a very big discount, or (3) Slash prices to end users and pay the principal and interest on the outstanding debt over time. Option number 3 was something that should have been done a long time ago. Over the past year, sales agents working for various condo developers have made it known to real estate agents that “developer prices are negotiable” or that the developer is “willing to listen to any reasonable offer”. However, with the exception of Groupe Pacific with Brickell of the River South, none of the Miami condo developers would go so far as to publicly reduce their prices. It didn’t make sense to me. The only logical explanation that I could come up with is that developers were afraid of the backlash from current condo owners. The days of name calling and finger pointing are over. That was so 2008. It’s in everyone’s best interest, current condo owners included, that each condo development close as many condos as possible. This has been especially true since Fannie Mae revised their guidelines for Florida condos. Reaching the all-important 70 percent mark for closings is so critical in this market.
It seems that Miami condo developers are finally turning to option 3. Over the weekend, two major condo developments announced large price reductions.
- 500 Brickell – On Sunday, I received an email from a 500 Brickell sales agent announcing “much lower pricing” on all remaining developer condos and that “prices have dropped up to $100,000”. The email revealed that one bedroom condos now start at $180,000 while two bedroom condos now start at $295,0000. I think a good old-fashioned price reduction is a MUCH better idea than including a Mini Cooper with the purchase of a condo at 500 Brickell. I think we’ll finally start to see a dramatic improvement in the closing rate of condos at 500 Brickell. I’d love to see a price sheet of all of the remaining condos to see if the reductions were made across the board.
- 1800 Club – I found out about this one on Saturday and actually visited several of the developer units on Sunday. I can honestly say that 1800 Club now offers the best deals in Miami. Where else can you find a condo with a water view for $173 per square foot in a recently constructed condo building in Miami? Unit 1715 is a very large 2 bedroom/2 bath condo with 1,810 square feet of interior that is now priced at $314,000. It doesn’t have a direct water view but it’s actually not bad, given the price. Below, I’ve included a picture of the water view from within the condo. As I was writing this, I received a text message saying that an offer was submitted to the developer today for unit 1715. As of the February condo closing rate update, 1800 Club was able to close 68.59 percent of its overall units. I think by the next update, we’ll see its closing rate push well past the 70 percent mark.
Within the next couple of days, I’m going to publish a more in-depth post about 1800 Club and the deals that are now available, along with pictures of the units that I saw on Sunday. It should be duly noted that the 2 bedroom condos facing direct east towards Biscayne Bay have not been reduced much from preconstruction prices, if at all. For example, unit 3505 which is a 2 bedroom/2 bath with 1,222 square feet of interior is priced at $385,000.
Below is a list of the other condos that I viewed on Sunday. As I said earlier, I will do a follow-up post within the next couple of days that will include pictures of these units as well as of the amenities and common areas.
- Unit 1411 – $235,000 – 1 bedroom/1.5 bath with 1,095 square feet of interior facing South
- Unit 1504 – $167,500 – 1 bedroom/1 bath with 822 square feet of interior facing West
- Unit 1002 – $425,000 – 2 bedroom/2 bath two-story townhouse facing South (I need to find out the square footage of this one but it’s big and has two large terraces.
I guess time will tell if other Miami condo developers will follow suit by repricing their existing inventory and disclose those new prices to the public. I think it’s a good step in the right direction.
A Look at Margaret Pace Park in the Arts District of Miami
I had some time to kill in between showing appointments Sunday afternoon so I decided to take a walk around Margaret Pace Park. It was a warm afternoon and the park was bustling with activity. For those of you who don’t know, Margaret Pace Park is located in Edgewater Miami along North Bayshore Drive from NE 17 Street to NE 20 Street.
A few volleyball games, tennis matches and a pick-up game of basketball took place while I was there. People were also out walking their dogs or jogging around the path that surrounds the park. I noticed several parents having fun with their young children at the playground as well.
1800 Club, Quantum on the Bay, Cite on the Bay and Paramount Bay are a few condo developments across the street from Margaret Pace Park. (Below, from left to right)
Here’s an aerial view of Margaret Pace Park that I took a few years ago from one of the condo buildings nearby:
New Miami Condos – Closing Rates for February 2009
It’s been a few months since my last Miami condo closing rate update. The percentage of closed units for 25 major condo developments are provided below, starting with the first development to begin closings. Four condo developments have been added: Icon Brickell, Everglades on the Bay, Infinity at Brickell and Epic. You’ll find these towards the bottom of this post.
Below, you will find the date that each condo development began closings followed by the number of closed units in each condo development:
With the exception of Onyx on the Bay and 50 Biscayne, the first group above has remained unchanged. Onyx on the Bay was able to close one additional condo while 50 Biscayne was able to close two.
Quantum on the Bay and Plaza on Brickell once again were able to show a decent improvement in their closing rate. Quantum on the Bay closed an additional 14 condos while Plaza on Brickell was able to close 21. 1800 Club did not have any new closings but I did find another deed that had been recorded twice. This is the reason why the total number of closed condos in this update is one less than the total stated in the December 2008 post for 1800 Club. It needs just 7 more closed condos to hit the all-important 70 percent mark.
As a result of the 60-unit bulk sale, Marina Blue showed the most improvement of the above five condo developments since the last update. I did, however, find re-recorded deeds for Marina Blue that I had previously missed. The developer of Marina Blue has now closed around 82% of the total number of units.
In my opinion, the five condo developments above are all likely candidates for some sort of bulk deal taking place in the future. Met 1 was able to close 7 additional units, Asia 2, 900 Biscayne Bay 13, 500 Brickell 17 and Axis 8. As a result of the new Fannie Mae guidelines, it is not likely that we’ll see significant improvement in any of the condo developments that haven’t thus far reached the 70 percent mark.
Above, you’ll find the four newly added condo developments which began closings within the past 3 months. Timing could not have been worse for these four. They’re going to need to find a plethora of cash buyers who are willing to pay dated prices. Ivy at Riverfront, which began closings back in June 2008, was able to close 14 additional condos since the December 2008 update.
The bright side is that the condo construction cranes of Miami are gone. The cranes that remain are for commercial developments. Marquis and Paramount Bay, which should begin closings within the next 3 months, will be the last of the newly constructed condos to hit the market in Miami. It does appear, however, that Met 3 has begun to lay its foundation. Hopefully, the condo market will reach some sort of equilibrium by the time that development has been completed.
Disclaimer: The above closing rate information was derived from public County records. There can be a 2-3 week delay from the time that a closing occurs and the time that the closing is recorded. The information above is not deemed 100 percent accurate as a result of delays in the recording of deeds and deeds being re-recorded.
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 Miami Condos – Closing Rates for December 2008
It’s been almost three months since my last Miami condo closing rate update. The last one was published on September 22, 2008. Unfortunately, there has not been a lot of progress in closings for most of the condo developments below since that time.
Below, you will find the date that each condo development began closings followed by the number of closed units in each condo development:
Latitude on the River had three new closings since the last update, Onyx on the Bay had three new closed condos and 50 Biscayne had two. Ten Museum Park and Loft Downtown 2 were both unchanged since the last update.
Quantum on the Bay and Plaza on Brickell each had an impressive number of closings, since the last update, considering how long ago closings began. Quantum on the Bay had 28 new condo closings while Plaza on Brickell was able to close 46.
On Friday, the Miami Herald reported that the developer of 1060 Brickell is looking to sell around 60 percent of its condos in bulk. Closings at 1060 Brickell recently reached the 40 percent mark meaning that this represents the developer’s remaining inventory.
900 Biscayne Bay and Ivy have now each reached the 40 percent mark. I’m actually quite surprised that not one of the condo developments in this last group has been able to hit the 50 percent mark. Enough time has certainly gone by. To rev up sales, 500 Brickell recently held a 4-day promotion offering a free Mini Cooper with any condo purchase from the developer’s inventory.
The next update will include Icon Brickell, Everglades on the Bay (now known as Vizcayne) and Infinity at Brickell which recently began closings.
Disclaimer: The above closing rate information was derived from public County records. There can be a 2-3 week delay from the time that a closing occurs and the time that the closing is recorded.
New Miami Condos – Closing Rates for September 2008
It’s been a little over two months since my last condo closing rate update. The last one was published on July 8, 2008.
Below, you will find the date that each condo development began closings followed by the number of closed units in each condo development:
You’ll notice with this first batch that I dropped Star Lofts from the list. I noticed a lot of double entries which made it difficult to gauge the true number of closed condos. Additionally, Star Lofts on the Bay hasn’t shown much progress in a very long time. Ten Museum Park closed 11 units since the last update while 50 Biscayne’s vast improvement reflects the bulk sale that took place. The rest of the condo developments showed very little progress.
Plaza on Brickell once again showed the most improvement within this group. Its closing rate jumped about 14 points since the July update revealing a total of 660 closed condos of the overall 1,000 in the two towers. Apogee South Beach once again inched closer to hitting the 100 percent mark, with only 2 additional condos to close before reaching it. Quantum on the Bay moves into second place in this group and has now closed around 75 percent of its condos.
The big story in this group is Midtown 4. It jumped from a 19.10 percent closing rate to an 84.92 percent closing rate. A large bulk sale of over 250 condos seems to have taken place to a buyer with a second party name of “D M MIDTOWN MIA OWNER LLC”. The same buyer also closed on slightly over 50 condos at Midtown 2 on the same day. Was this simply the developer transferring units to one of its other entities or was this an outside buyer with no association to the developer? Marina Blue jumped about 10 points, settling at around 70 percent of its condos closed. Wind and Asia showed nice improvements this update with Wind increasing around 17 points and Asia about 18 points.
These last four condo developments all showed good progress since the July update. The biggest surprise to me was Ivy which closed 125 new condos since that time. I would have guessed that 500 Brickell and Axis would each have more closed sales than Ivy.
Disclaimer: The above closing rate information was derived from public County records. There can be a 2-3 week delay from the time that a closing occurs and the time that the closing is recorded.
New Miami Condos – Closings Rates for July 2008
The last closing rate update was published on May 28, 2008. I collected the data for this month’s update this past Sunday, July 6, 2008. This month, I also included the number of closed units below each graph in parentheses.
Below you will find the date that each condo development began closings followed by the number of closed units in each condo development:
Not much has changed with this first group of condo developments since the May update except with 50 Biscayne. It went from having around a 67% closing rate to about a 75% closing rate since the last update. However, I took a close look at the numbers and noticed that 26 of the 43 newly closed condos were deeded to TRG 50 Bisc Suites LLC. All 26 units were suite units. It appears as though The Related Group transferred these 26 units to another one of its own entities. I’m not exactly sure though. Even without these 26 units, 50 Biscayne would have had 17 newly closed units. Onyx on the Bay had 5 newly closed units.
Plaza on Brickell saw the most improvement in the group of condo developments above since the last update with a 13 point increase in closings. It now shows that 52% of the overall 1,000 units have closed. You’ll also find slight to moderate improvements in the other condo developments in this group. According to public records, Apogee South Beach now only needs 6 more condo units to close in order to reach 100%.
Marina Blue continued to show good improvement in this update with around a 14 point increase in closings. Marina Blue now has nearly 60 percent of its condos closed. Wind had an increase of around 11 points, Asia around 10 points and Avenue at Brickell slightly over 7 points.
Above is the newest batch of condo developments that recently began closings. I must say that I’m pretty impressed with 900 Biscayne Bay having 79 closed units within the past 2 months. It probably actually has 100 or more closed units by now since there can be a 2-3 week delay in the time that a condo closes and the time that the deed is recorded. It’s still too early to judge the other three condo developments in this group. The next update should shed a little more light. I did have a chance to tour Axis today for the first time. I’ll try to share some pictures with everyone towards the end of the week. By the way, I wasn’t able to find Met 1 which is why it wasn’t included in this update.
Disclaimer: The above closing rate information was derived from public County records. There can be a 2-3 week delay from the time that a closing occurs and the time that the closing is recorded.
Miami Green Spaces
Living within close proximity to a public green space is usually a pretty important factor, especially for dog owners, when considering places to live in a large metropolitan area. Miami is no different, which is why I’ve decided to discuss various public green spaces within walking distance to many of Miami’s new condo buildings. This post will probably be more informative to nonlocals but it actually still amazes me how many people living in Miami haven’t heard of nice parks such as Margaret Pace Park.
- Margaret Pace Park – Of the public green spaces mentioned in this post, Margaret Pace is my favorite. It is located in the Edgewater Miami within walking distance to Quantum on the Bay, 1800 Club, Cite on the Bay and the future Paramount Bay. Margaret Pace Park offers a number of activities such as tennis, volleyball, basketball and soccer. It’s typical to see volleyball and basketball games continue well until the sun goes down. You’ll also see runners dashing around the parameter of the park and dog owners playing with their pets and mingling with other dog owners. Those with small children will also appreciate the children’s park at Margaret Pace park.
- Museum Park (formerly Bicentennial Park) – This public green space was recently renamed Museum Park. It will be a collaborative effort by the Miami Museum of Science and the Miami Art Museum. Museum Park is located just south of the I-395 expressway and just north of the American Airlines Arena. It is walking distance to Ten Museum Park, 900 Biscayne Bay, Marina Blue and the future Marquis in the Downtown Miami neighborhood of Park West. Currently, this is probably the most underutilized public green space by locals throughout Miami. You’ll occasionally see soccer games taking place, as you do in the picture above, but that’s about it. Museum Park is home to a variety of music events, with the largest being Ultra Music Festival held in March. It’ll be nice to see the transformation of Museum Park within the next 1-2 years.
- Bayfront Park – This public green space has a children’s park, an amphitheater (not seen in the picture above) and a helium balloon ride, called Miami SkyLift, that unfortunately hasn’t taken off in quite a while. Bayfront Park is also home to the Flying Trapeze School and offers yoga classes three times per week. Bayfront Park is located in Downtown Miami just south of Bayfront Marketplace and just north of the Intercontinental Hotel. It is walking distance to condominium buildings such as 50 Biscayne, the Loft Downtown, Loft 2, One Miami, Met 1 and the future Everglades on the Bay (now known as Vizcayne).
There are a variety of other public green spaces throughout Miami not mentioned in this post. However, these are the ones located near many of the new condo buildings in Miami. Unfortunately, there currently aren’t any public green spaces in Brickell.
New Miami Condos – Closing Rates for May 2008
It’s been almost 2 months since my last post regarding the closing rates of various Miami condo developments. That post was published on April 4, 2008. Referring back to that post and comparing it to the figures in the graph below, you may quickly realize that I must have made a mistake last month when pulling the data for Loft Downtown 2. I’m not sure how that happened. I double and tripled checked the figures this month, however, for all of the condo developments.
Below you will find the date that each condo development began closings:
Even with the overstatement of closed units corrected, Loft Downtown 2 still has the best closing rate of any condo development located in Miami included in this post, and the second best overall. Loft Downtown 2 isn’t as close to hitting the 100 percent mark as I had previously thought, but it’s doing comparatively quite well. The overall closing rate at 50 Biscayne increased slightly over 6 points while the rest, in the group above, increased 2.52 points or less, since the last update.
As over half of this group approaches the one year mark since their closings began, a few interesting questions come to mind. What is happening to the defaulted condos? Are developer’s leasing them and holding until the market gets better or are they hoping for onesy and twosy buyers to come along to slowly deplete their inventory? Are any of these developers feeling the pain yet? I’ve heard that at least one of these condo developers has been for a few months. If that’s true, then when, if ever, are we going to see some bulk sales?
I’m sure glad he’s proving me wrong. Those were my first thoughts when looking at the chart above. My second thoughts are that Apogee South Beach has continued to make great strides in closing its condos. Apogee has improved almost 15 points since my last update. Quantum on the Bay and 1800 Club, the only other two condo developments in the group above the 50 percent mark, each continued to show nice progress as well.
Below you will find the date that each condo development began closings:
Marina Blue is off to a very good start. Pretty impressive from a condo development that started closings so late in the game. Asia is doing relatively well given that it had its first closing less than two months ago. However, Asia has only 123 total units. I’m expecting that we’ll some good progress in Asia’s closing rate next month. I guess we’ll have to wait for the next update, however, to find out.
Disclaimer: The above closing rate information was derived from public County records. There can be a 2-3 week delay from the time that a closing occurs and the time that the closing is recorded.
New Miami Condos – Closing Rates for April 2008
It has been a while since my last post regarding the closing rate of various Miami condo developments. The last update was provided on February 20, 2008. As with the February post, the first graph below reveals the closing rate of those Miami condo developments that began closings prior to November 1, 2007. The condo developments are ordered, from left to right, according to when closings began.
Below you will find the date that each condo development began closings:
I’m quite impressed with the closing rate of Loft 2. Their closing rate has improved roughly 13.5 percentage points since the last update and is within 6 percentage points of reaching the 100 percent mark. Great job!
The rest of the condo developments in this group have not changed much since the February update. The closing rate of 50 Biscayne has improved about 6 percent while the closing rate of Onyx on the Bay has improved a little more than 4 percent. The rest of the condo developments have improved 1.5 percent or less. You may notice that the closing rate of Star Lofts on the Bay has actually gone down since the February update. Well, obviously, two closings weren’t rescinded. I discovered two deeds that were re-recorded. I hadn’t caught these in the February post. No additional units have closed at Star Lofts on the Bay since November 8, 2007.
The following graph shows the closing rate of various condo developments in Miami that began closings after November 1, 2007.
Below you will find the date that each condo development began closings:
For the most part, a lot has changed with this group since the February closing rate update. Of this group of condo developments, I must say that Apogee South Beach has done a remarkable job! Apogee was the second to last condo development in this group to begin closings, yet it has far surpassed the success of the others. The high closing rate of condos at Apogee proves once again that the ultra-luxury condo market in Miami Beach is still doing quite well.
The 1800 Club has pushed well through the 50 percent mark and has improved roughly 16 points. Quantum on the Bay is hovering right at 50 percent which is good considering that they received the TCO on the second tower around the beginning of March. I can definitely see it hitting the 75 percent mark within the next two months. I also want to note that Plaza on Brickell and 1060 Brickell are both comprised of two towers. I’ve heard that closings for condos in the 851 tower of Plaza on Brickell recently began. The condo units in the 851 tower represent 60 percent of the overall development. I also know a few people who have contracts on condos in the 901 tower who are still waiting to receive a closing date. I’m not sure if only one or both of the towers at 1060 Brickell have begun closings yet.
Next month, I plan to include Marina Blue, Wind and Midtown 4, which each began closings recently.
Disclaimer: The above closing rate information was derived from public County records. There can be a 2-3 week delay from the time that a closing occurs and the time that the closing is recorded.
