Over a year after we first reported the pool closure at IconBrickell, they have finally given the dates for the work to begin. In a letter to residents this week, the condo association has announced that starting December 5, the pool will be inaccessible for approximately 12 months. Surprisingly, the condo association did not make arrangements for an alternative pool for the residents.
Anticipation of the repair and special assessment have sent sale and rental prices in a tailspin. Sales prices in the last 90 days are averaging $426/square foot. Just a year ago, apartments in the project were closing at $584/square foot.
Rental prices have also been in free-fall. Unit 4103 in Tower 2 rented in 2015 for $5,300. This year, it rented for $3,800 after 5 months on the market. In Tower 1, unit 4104 rented this month for $2,000, down from the $2,600 that the landlord received last year. It doesn’t help matters that there are currently 180 available rentals on the market. Since 24 apartments rented in the last 30 days, it will take over 7 months to absorb all of this inventory.
On the bright side, this is a fantastic opportunity for investors who are looking for a long-term hold or for those who are looking for a great price on a vacation home. While the values are depressed now, I fully expect them to rebound when the amenity deck reopens. There are still plenty of sellers who need to move on from the properties for personal reasons, or investors who are not able to wait out the storm. How much lower do you anticipate the prices will fall? We are happy to help if this situation is an opportunity for your investment goals.
Tenant Sues Condo Association For Price Gouging On Application Fees
Quantum on the Bay
A tenant at Quantum on the Bay in the Omni district finally did something about the high application fees that are being charged to prospective tenants, according to the Miami Herald. He is suing them because their application fees are in excess of the $100 cap that the Florida statute issues.
This has been an ongoing problem for tenants in many of the Downtown area buildings for several years. Some condo associations use these elevated fees in order to avoid having to make a special assessment on the unit owners for repairs or upgrades. The association at Quantum once had a $400 application fee, but it was later reduced to $150 after so many potential tenants complained. In order to continue bringing the income that they once received from the application fees, they split it into the application fee plus the administrative fees. Some other buildings have ‘impact fees’ of $500, but Quantum is one of the highest priced buildings in the area for a tenant to apply for.
Even though it is not lawful for a building to charge these exorbitant fees to tenants, many still do. The tenants really have no choice but to accept the fees. Protesting only causes delay and added expenses. If they miss their move-in date, they would need to stay at a hotel until the issue is resolved and there is still no guarantee that it would be resolved in their favor without a lawsuit. The Government Affairs department of our Miami Association of Realtors has been lobbying in Tallahassee for some time already, trying to convince them to enforce the laws.
Now, most buildings also charge a security deposit for the common areas and for pets, but that is different. Security deposits are returned. We typically see a security deposit that is held through the duration of the lease in order to guarantee there will not be damage to the common areas, a smaller security deposit for the actual move to guarantee that the elevators and hallways are not damaged by the movers and/or a pet deposit to the building.
You can read more about the Florida Condominium Act here, so that you know your rights. While it seems that Quantum is being singled out, this is a large problem throughout the marketplace and something that we are striving to change. On a day to day basis, the best we can do is see that our clients get settled as peacefully and efficiently as possible. On a larger scale, we are very much a part of the efforts from the Miami Association of Realtors to bring change to this practice.
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.
Terra’s David Martin Debuts his New Real Estate Column in Forbes
David Martin
A warrior and a poet? Meh. Maybe not, but David Martin, head of Terra Group and developer of Grove at Grand Bay, Park Grove, and GLASS, is now a developer and an author. He’s writing a twice-monthly column over at Forbes on ‘real estate development, design, and sustainability,’ beginning with a discussion on why more buyers in South Florida are end users these days as opposed to speculators. To summarize his point in just a few words: Miami’s a bit more grown up, and that makes a big difference.
Centro Moves Closings & Gets Fannie Mae; Check Out Our Drone-Cam!
Centro. Photo by Lucas Lechuga.
Just like everything from Miami’s biggest construction projects to your Memorial Day flight, closings at Centro have been slightly delayed. A month ago we heard word that the project was wrapping up construction and aiming to acquire their TCO by the end of May/beginning of June, allowing residents to close on their units and move-on-in. Now, according to representatives of the project, they’re talking more like the end of June. Okay, so not a big shocker. Stuff happens. Centro, in the heart of Downtown Miami, is still rapidly progressing toward completion.
If you’re the kind of bloke who likes his condos finished before he buys one, Centro does have some units left, with 645-foot one bedrooms starting at $303K, up to 1131 square foot 2 bedroom/bath units topping out at $578,900. Finally, if you’re the kind of bloke who needs financing and you really want to live at Centro, well you’re in luck too. Centro was granted conditional approval from Fannie Mae (warning: PDF) at the end of last month, lasting through January of next year.
And if you’re wondering the type of views that Centro will offer, look no further. Check out the cool drone video below which showcases the building and fabulous views that it offers.
Almost Sold Out, Two Park Grove Begins Concrete Pour at 2 AM Tonight
The tower in the middle is Two Park Grove.
Up late and in the mood for a show? The foundation pour for Two Park Grove, starchitect Rem Koolhaas/OMA‘s first residential tower in the United States, is beginning at 2 AM tonight and will continue until 4 PM tomorrow. The first of the three Park Grove towers to begin construction (so… Rem Koolhaas’ first, second, and third residential towers in the U.S.) Two Park Grove is being co-developed by the Related Group and Terra Group, and is about 97% sold out (with pricing starting at $2 million). According to the press release 2,600 cubic yards of concrete will “lay the foundation for an elevated 3-foot deep concrete slab at its core that will support the faceted tower columns…This pour requires four pumps and the labor of over 100 people placing up to 400cy/hour.”
On the River the Old Epic Sales Center is Being Demolished, While Met Square Construction Continues
Former Epic Sales Center. Photo by Lucas Lechuga.
An Argentine developer and grocery store mogul has finally begun demolition of the former Epic sales center at 300 Biscayne Boulevard Way, on the Miami River. The Next Miami has some closer photos of the demolition. The over-the-top 2.5 story structure has stood there far beyond its planned lifespan, more recently acting informally as sort of a yacht club for the superyachts tied along its river dock. (we don’t know how much of the interior was utilized for this secondary purpose, but the parking below the elevated structure was) Epic developer Ugo Colombo sold the 1.25 acre wedge of land for a whopping $125 million to German and Gloria Coto, whose family is best known in Argentina for their supermarket chain. The Cotos are planning an 817 foot ‘lighthouse’ condominium tower on the site.
Meanwhile, across the street construction continues at Met Square, the last element of the Metropolitan Miami megaproject which has been years in coming.
Met Square construction. Photo by Lucas Lechuga.
Closings at Centro Begin Last Week of May/First Week of June
Centro is done. Well technically, it’s almost done. According to representatives from the sales office, the Newgard Development Group’slatest condo tower Centro, at the corner of SE 1st Street and 2nd Avenue, is expecting to begin closings the last week of May/first week of June. Presumably that will be when the project receives its Temporary Certificate of Occupancy as well. At the moment construction fencing and scaffolding are still up, but the construction cranes have been removed.
Centro was one of the earliest to herald the resurgence of Downtown Miami in this real estate cycle (after the apocalypse of 2008 that is) and was even a little controversial in the beginning because it was built without a garage. And you know how Miamians love their cars. Then during site excavation, some nincompoops saw the unearthed foundations of a hotel formerly on the site and thought they had found Roman ruins. Hopefully the project, will be as entertaining when it’s done as it was watching it get built. We’re looking forward to seeing those Yves Behar-designed interiors too.
Sales Launch for Auberge Residences’ First Tower
Auberge Residences viewed from the Arsht Center
After lots and lots of planning, the Related Group is having the grand opening of the new Auberge Residences Miami sales center in typical Miami style with a launch party this week. The developer appears to have adjusted to softening market conditions by erasing the planned second and third towers from renderings and putting them off while they focus on the first. However, by the look of everything else related to the project, this is still very much Miami, where decadence and financial profligacy still reign.
The 60-story tower will have 290 units (far fewer, of course than in the three-tower configuration), 90 suites managed by Auberge Resorts, lots of art, outdoor pools on the 12th floor and 60th floor, and a spa with what in a rendering appears to be an indoor pool. The 12th floor will have other amenities galore, including a wine room, cigar lounge, club room, media room, restaurant, etc. Downstairs, restaurants and retail will activate the street. The structure is being designed by Arquitectonica, with exterior spaces by landscape architect Enzo Enea. Piero Lissoni is doing the interiors.
Prices are in the $500,000s for one bedrooms with dens, under $1 million for 2 bedrooms, and in the low $1 millions for three bedrooms. Penthouses, some of which are duplexes, range from $1.7 to $4.1 million.
