Welcome back to a new week! We’re going to continue our Market Stat Monday series in Downtown Miami’s Centro building. This building made a splash when it was announced because it was the first new tower in the neighborhood to be constructed without parking. It is located in the Central Business District at 151 SE 1st Street, very close to MDC and Bayside Park, so the area is quite walkable.
Another interesting quality of Centro is that all 352 units are loft-style. They’re not duplex loft style (two story layouts), but they are New York style lofts in that there are no walls between the living areas and the bedrooms. This can be a positive or a drawback, depending upon your style of living. It is urban, chic and cool, but the lack of privacy could make things difficult for people living in a roommate situation.
Since there is really nothing different about the penthouses at Centro other than the fact that they’re on the highest floor, I am going to factor them into the statistics search today. Furnished units are factored out. Also, since I’m in the mood for good news, I’m going to look first at the rental market.
Centro Rentals
Because of it’s proximity to MDC and the price, this building was really hot for a few months on the rental market. People could move into a brand-new condo for as low as $1,450/month! Those days have come and gone because there’s just not that much inventory right now. There is only one 1 bedroom layout available to rent as of today, and it is $1,920/month.
Overall, there are 10 active unfurnished listings on the market today. As I said above, the one bedroom is listed for $1,920/month with a partial bay view from the 36th floor. Two bedrooms are listed between $2,000-$2,650/month depending upon the view and size. Most all units in Centro have a city view, a few have a partial bay view.
This has been a very active year for Centro. It opened last summer, in 2017 we have seen 88 total unfurnished rentals. The prices ranged from $1,450/month up to $2,800/month and averaged $2.56 per square foot of living space.
The units that found tenants were marketed for an average of 66 days and accepted 96% of their asking price. Something else that sticks out to me in this report is that the lowest-priced rental stayed on the market for just 3 days. There was also a unit that closed for almost 10% above asking price! This demonstrates something that we tell our clients every day. There is a lot of competition for units that are at the entry point of the market (least expensive in the neighborhood). The rentals happen quickly and for very close to asking price, so if you love an apartment then it is best to make a move for it.
With just 10 units currently available and 88 rented so far this year, that works out to less than 1 month of available inventory! Amazing!
Centro Sales
Now it’s time to swallow our bitter pill. There are currently 55 people trying to sell their apartments in Centro, and 2017 has brought a paltry 5 closed sales. That gives us 66 months’ of inventory. Oof.
The active listings are asking $489/square foot on average, and those who did find buyers sold for $479/square foot, accepting 94% of their asking price. The building is one of the few in the area that is Fannie Mae approved, making financing easier, so what’s the problem?
It appears there are just WAY less buyers in the marketplace. Now more than ever, it is imperative that sellers who sincerely want to sell choose an agent that has access to buyers and a way to make the listing shine in a pack of similarly-priced and similarly-finished apartments. You need an agent who will make sure the property is available to be shown when the buyers request, meets them there to roll out the red carpet and give a tour of the building, answering their objections on the spot and increasing the likelihood that your apartment is the one they choose. I apologize for the lecture, but listing agents need to work harder than ever to make closings happen these days. Here’s a look at the scary stats.
I was amazed to see that even with Fannie Mae approval, there were so few transactions in the building. Only one sold at full-ask, and that seller threw in seller financing to make the deal work. They garnered $540/square foot, the highest price for a resale in the building ever.
To be clear, I’m not dogging Centro. It is very well positioned in the market, offering the lifestyle and finishes that residents of the Central Business District want. Hopefully the demand will pick up and these sale listings will start moving again. Until then, just keep them filled with tenants!
Tips For Foreign Investors Seeking EB-5 Visas & Paramount Miami Worldcenter Update
EB-5 can be a great opportunity for foreign investors who seek American citizenship to be able to do so, but the investment visa is not without risks. It is very important to choose the right project to invest in, so that the investor does not lose their investment without securing the visa. As a rule, the investment money must be considered an at-risk investment, but savvy investors can review their potential projects and choose the one most likely to end in the visa PLUS the return of their funds.
What Are Some Tips To Ensure Success?
When reviewing EB-5 opportunities, it is important to choose a project that actually creates a minimum of 10 full time jobs per visa issued. Good intentions are great, but the project has to actually happen in order for the visas to be issued. Because of this, it is important to invest with an experienced developer who is well-funded and already under construction.
If a developer is not experienced, the project is unlikely to come to fruition, leaving the EB-5 funds at risk. In this case, the investor may or may not be able to recover their $500,000 in investment money, but the $50,000 in administration fees are nonrefundable.
If the project comes to fruition but does not create the required amount of jobs per hopeful EB-5 investor, then a portion of the investors will receive their visas, but those who signed on later in the project would lose their administration fee and may or may not be able to recover their $500,000 investment. Investing in condos is safer in this instance, since investors are more likely to recover their money through the condo sales. Recovery of the funds is more tricky for parking garage or infrastructure projects.
Don’t be greedy. It is extremely rare to find an EB-5 investment program that will provide the investor with the visa AND a healthy financial return. Many times, investors receive a small return and the visa. This brings me to Paramount Miami Worldcenter, which has an interesting offering that is one of the best I’ve seen.
How Does The Paramount Miami Worldcenter EB5 Opportunity Work?
The developer of Paramount Miami Worldcenter is offering a limited number of EB5 investment opportunities to buyers of condos in the project, which is currently under construction in Downtown Miami. There are around 35 opportunities remaining of the original 150. The opportunities are funding just 14% of the capital required for the project, which has already secured its $285 million senior loan and is 60% sold with 50% deposits due prior to closing.
With 150 available investor visas, 1,500 jobs are required to be created. The project is estimated to create over 5,000 total jobs, so investors should have no problem securing their visa upon completion.
At the time of closing, EB5 Investors are offered two options:
1 – They can close on their condo separate of the investment and move in immediately.
2 – For the investors who prefer to roll their investment funds into their condo purchase, they have the option to delay closing by three years on a leaseback program with the developer. The developer will offer the apartments for lease and split the income from that rental with the investor. After the three year term, the investor can close with the use of their investment funds.
The remaining residences start at $626,000 for a 1 bedroom plus den with 1,095 interior square feet up to $1.8 million for a 3 bedroom plus den with a southeast view and 2,376 interior square feet. Overall, prices average $675/square foot and penthouses are available upon request.
If you or someone you know is interested in more information on the EB5 program, please contact our office for a full presentation.
Zaha Hadid’s One Thousand Museum Featured In Upcoming Documentary “Impossible Builds”
A documentary is in the works for PBS and Discovery called “Impossible Builds,” and Zaha Hadid’s One Thousand Museum is being featured, according to an announcement from the developer. There will be only five projects in the world to be featured with the recurring theme of delving into the making of complex structures throughout the world.
One of the most unique features of the 62 story condominium tower is the 5,000 piece exoskeleton that is sourced from glass fiber reinforced concrete. The exoskeleton arrives in shipments from Dubai and installed onsite.
“It is an honor for the project to be spotlighted in this important documentary film,” said Louis Birdman, one of the co-developers for One Thousand Museum by Zaha Hadid Architects. “We could not think of a better way to immortalize the forward-thinking project to a global audience across continents through this important documentary.”
Other projects to be featured will include the thinnest skyscraper in New York City and a resort villa in Dubai. The documentary is set for completion in 2018 and will be broadcast to approximately two billion viewers worldwide, according to the production company.
The tower is currently just past the halfway point of vertical construction. When completed, it will reach 709 feet and is the only residential skyscraper in the Western Hemisphere that was designed by Zaha Hadid. Here are some of the latest construction photos.
VIDEO: Paramount Miami Worldcenter Construction Update
Paramount Miami Worldcenter from the north side construction entrance April 25, 2017.
Phase one vertical construction is now underway at Paramount Miami Worldcenter, according to the developer. The seven story pedestal has reached its final height at a rate of about one floor per week, now they begin construction on the tower portion of the project. When completed, the residential tower will bring 522 residences to Downtown Miami in a glistening 60 story tower atop a 27 acre high street retail promenade. The tower boasts the most amenities of any residential tower in the world.
The residential condos are currently 62% sold at an average of $650/square foot. Some of the available purchase opportunities that remain are:
a 1,095 square foot 1 bedroom with a den at $626,000 is the least expensive apartment currently available. Considering the typical 1 bedroom in the area is 700-800 square feet, this would probably be considered a 2 bedroom in many competing developments.
Two bedrooms start at $1,287,000 for a 44th floor apartment with 2 bedrooms, 3 baths and a den over 1,753 square feet.
Three bedrooms start at $1,581,300. There is one available on the southwest corner that is 2,230 square feet and has 3 bedrooms, 4 baths and a den.
The entire project is expected to be finished in 2019. Here is a video that Bryan Glazer put together that shows the scope of the project and offers a preview of how much the neighborhood will change with its addition. Last year, the developer also released a movie preview that highlights the projects amenities in dramatic form. I am very excited to see this one start to take shape!
Video overview of Paramount Miami Worldcenter by Bryan Glazer
New Miami Condo Buildings With Tennis Courts
This time of year brings one of our favorite events to Miami. The Miami Open runs from March 19-April 1 this year, and to commemorate it, let’s have a look at our favorite buildings in the greater downtown area that have tennis courts!
If living in a brand-new condo is important to you, there are several in the pipeline. Key International’s 1010 Brickell is slated to open within a few weeks. They have an indoor tennis court and 3 remaining presales starting at $950,000. All are 3 bedroom layouts. There is one resale unit on the market so far. SLS Lux is also on track for completion this fall/winter. They have only four penthouses remaining that have recently been repriced.
In Downtown, Paramount Miami Worldcenter is going to bring every amenity imaginable to their mega-project. They are about 60% sold and have residences priced at an average of $750/square foot. Because of their strong sales figures, they were recently able to secure the second largest construction loan in this build cycle. They are currently in vertical construction and should deliver keys at the end of 2018.
If you’re looking for something sooner, you could head up to Edgewater and check out Biscayne Beach. They have 2 tennis courts over their parking deck and a bayfront beach club. They have 5 remaining presale opportunities, and we will be listing an amazing high floor 3 bedroom on the southeast corner.
For people who are looking for an integrated community, I would suggest the waterfront Paraiso complex. There are five residential sections to the complex, totaling 1400 units. Paraiso Bayviews is the most affordable section, with remaining inventory starting at $470k (as of today). They just passed the 42nd floor of construction and should be ready by the end of this year. Paraiso Bay was the first of the towers to open sales. They are currently all sold out and on track to open this summer. GranParaiso is the most luxurious of the towers. It will be finished in Spring of 2018 and has 2 bedroom residences starting at $1 million. One Paraiso is the sister building to Paraiso Bay. They have 3 remaining penthouses, starting at $1.9 million. Aside from the towers, there is also a small enclave of bayfront beach homes. There are only 8 in total and 1 remains at $2 million.
Hyde Midtown is going to be the first project in Midtown to offer a tennis court for residents. They recently topped off at 80% sold. Their prices start in the mid $400,000’s and the rooftop penthouses start at just $735,000! The penthouses have rooftop terraces as well.
Come back tomorrow and we can take a look at the existing buildings who also offer tennis courts!
One Miami Is The Next Building To Get A New Pool
Tis the season for pool repair! One Miami has followed suit with IconBrickell, Infinity at Brickell, Villa Regina and EPIC Residences and has announced a pool makeover (Infinity’s renovation is already complete). Luckily, the One Miami repair will not take as long as the IconBrickell renovation. The work started this Monday, March 20, and is slated to last three months, opening just in time for Summer, according to a notice from the condominium association.
During the construction, all three pools will be closed and work will go on from 9am-4:30pm. Residences will still have access to the viewing deck as well and the association also made a walkway in between the One Miami East Tower and One Miami West Tower to make for easy access to the InterContinental elevator. The work is in conjunction with the face lift that One Miami began late last year. It is not immediately known whether additional upgrades will be made to the gym or other common areas.
Despite being 12 years old (older than many of the alternative choices), One Miami has fared very well in recent months. There are currently 53 available units, 4 units are in contract and waiting to close, and 2017 has brought 5 closings with an average sale price of $370/square foot.
Aston Martin Residences – Available Floor Plans & Prices
We were excited earlier this week to receive a full presentation of Aston Martin Residences, the new super-luxury development in Downtown Miami. Earlier, we posted the new renderings along with new details about the amenities and finishes that were shared with us during that presentation.
I always say that the best time to buy is in the very beginning or the very end of a project’s sales cycle. In the beginning, the details are less concrete and many times the sales center and brochures are not yet completed. At the end, the developer is eager to move on to their next project. Either way, these are the times to get the best pricing.
In our previous post, we mentioned that 25 of the available 391 residences have already been sold. The developer is now selling their second release, here is our favorite option from each line. Please remember that this is the availability and price as of today. If you are interested in one of the options, just reach out and we can quickly send you an update.
Here is where you can find the sales brochure and fact sheet that we received when the project originally launched. Now, without further adieu, The Residences:
River Residence 401 – $3,181,900 ($954/square foot)
River Residence 502 – $1,470,900 ($997/square foot)
River Residence 703 – $1,763,900 ($969/square foot)
River Residence 1105 – $531,900 ($762/square foot)
River Residence 1006 – $681,900 ($799/square foot)
Miami’s Rental Market Is In Decline, About To Be Flooded. What Does This Mean For You?
The rental market in the Downtown Miami area is in for a jolt, according to an inventory report from the Downtown Development Authority. Many people expected that rental prices would begin to decline in 2017 as the new luxury condo buildings begin to open. As of the third quarter of 2016, the prices were already beginning to decline after buildings such as The Bond at Brickell and SLS Brickell began to open, flooding the market with new options for prospective tenants.
What many people did not see was the influx of new rental buildings that are going to start being delivered in 2017. A few have already come to market, but 2017 promises a whole new array of choices for tenants. Landlords are fervently trying to keep their tenants if leases are coming up for renewal, but many of the options are too good to pass up. In 2016, we saw 3,748 new condo units come to the market and 1,038 additional units in rental-only buildings. 2017 will flip that number, with 2,774 new condo options and 3,575 new units in rental-only buildings.
What to do if you are a tenant?
Don’t be greedy. While the market is in decline, the condos for rent in Miami are not going to rent for fire-sale prices. Yes, you may have more leeway in negotiation than once before with condo units, rental-only buildings typically do not negotiate their prices. Rather, they are pre-set at the beginning of each day based upon an algorithm in their computer software.
A quick move-in is worth a lot. If you can offer to move-in as quickly as possible, you will have more negotiation power than if you are shopping several months in advance. I always say that the sweet spot between the contract date and the move-in date is 3 weeks. That gives everyone enough time to get their paperwork together and applications completed. Building applications commonly take 2 full weeks in condo developments. Rental-only developments are commonly quicker, so are a good option if you get in a pinch and need to move even more quickly.
Have ONE agent to represent you. Make sure that person is someone who is well-informed about the market and what is available. That will prevent you from drowning yourself in options and becoming frustrated. Be open with your agent about what features you like and what features you are disinterested in. Let your agent take you to rental developments as well. Many times, we know ahead of time what the availability and rough price ranges are at the rental developments.
What to do if you are a landlord?
If you currently have a good tenant, entice them to stay and treat them well.
Don’t panic, but understand the monetary value of each month of vacancy. Price your available rental on the market as quickly as possible and with a firm that will give you the most exposure.
When reviewing offers, consider reductions based upon the risk of a full month of vacancy rather than holding onto the idea that your condo will earn as much this year as it did in years past. It won’t. If you have a unit that was previously earning $3,000/month and you receive a quick-move in offer for $2,750/month, it would be a good business decision to accept. Otherwise, you could be stuck accepting far less in contract value on top of the $3,000 expense of having the unit vacant for a month.
Negotiate with people who lowball. Run your numbers and decide what is the lowest price you can accept based upon available options for the tenant and the amount of vacancy that you are already into. Not that you will always have to accept that lowest price, but you know how much room you really have for negotiation.
Remember that just like market storms that we have weathered in the past, this one will blow over. The condos will still be beautiful and in-demand afterward. If you need to sell, then sell. Otherwise just be patient until the inventory is absorbed.
Congress Unanimously Agrees To Make FHA Financing Easier For Condo Buyers
In a rare moment of solidarity, Congress unanimously agreed to pass the proposed changes to the FHA approval guidelines for condo purchases, opening the way for middle-income buyers to participate in the condo market once more.
Over recent years, the FHA has imposed nearly impossible guidelines for condo purchases that have left a large segment of buyers out of the market, particularly first time homebuyers. The problem has been that in order to secure an FHA loan for a property, the buyers must qualify (relatively easy), AND the building must qualify (almost impossible). The approval process was expensive and the costs were not refunded in the event that the project was rejected. The approvals had to be renewed every couple of years as well. Most condo associations opted to forego the application and just not have FHA as an option for purchasers in the building. With the new guidelines, the projects no longer need to go through the approval process. Buyers can now apply for a spot-approval on individual units and the owner-occupant vs investor ratios have been lowered. Bravo!
This is going to be a big help for actual residents of the Downtown Miami area who are ready to buy a condo, but maybe don’t have the 20%-35% down payment that is currently required to buy a property. You can read more about the new guidelines here.
