Almost nothing in Miami goes according to schedule. That is why I was pleasantly surprised to learn that myBrickell topped-off earlier this month. Far before the first shovel even broke ground, Related Group projected that top-off would occur in February 2013. Letters were mailed to contract holders last week on February 1st to announce the good news. Closings had been projected to start in September of this year. I guess we will see if Related Group is able to meet that deadline as well.
For those unfamiliar with the development, myBrickell is a 28-story, pre-construction condo development in Brickell with 192 total units. It has been sold out for quite some time.
Case Study: Determining the Value-added for Having High Ceilings
A high ceiling is a feature which is typically associated with a penthouse. It can be difficult in these situations, however, to ascertain the value that is attributed solely to having higher ceilings. This is because a penthouse typically also has other value-added features such as one or more of the following:
an upgraded master bathroom
an upgraded kitchen
the best view in the building
an unusually large floor plan in relation to other floor plans in the building
additional parking spaces
Most importantly, a penthouse is rare and therefore commands a higher premium than the rest of the floor plans in the building that are in greater supply.
What if, however, we could hold all else constant in order to better determine the added value that is associated with having high ceilings? In this regard, Icon Brickell presents itself as an interesting case study. The penthouses at Icon Brickell do NOT have higher ceilings than the rest of the units. However, certain floors do have higher ceilings. In Tower 1 of Icon Brickell, floors 14, 15, 22, 28 and 41 have 16-foot ceilings. In Tower 2, floors 14, 15, 22 and 41 have 16-foot ceilings. The rest of the floors, including the penthouse levels, have 9-foot ceilings. As a result, it is very possible, and highly likely, that a unit located on the 41st floor will sell at a premium to a comparable unit that is located on the 42nd floor. Furthermore, the situation also presents the possibility that a unit located on the 41st floor will sell at a higher price per square foot than one located on the penthouse level.
Due to the lack of resales, there is no evidence to validate my assumption but I think we can all agree that a high ceiling is a feature that should indeed command a premium. Of course, there are going to be those who would argue that they would never pay a premium for having higher ceilings due to the higher energy costs that would be associated but, then again, those are the type of people who likely wouldn’t pay a premium for just about anything. I’m not here to provide everyone with an all-knowing answer as to what that premium should be. The answer will be provided to us by way of our free market economy. However, it makes for an interesting story to follow.
Which would you rather have, a penthouse located on the 57th floor with a 9-foot ceiling or a unit located on the 41st floor with a 16-foot ceiling?
Marina Blue Market Update – 2011 to Present
Below is a market update that I emailed to Marina Blue condo owners late last week. While not everyone reading this will have an interest in Marina Blue, I think a similar upswing in prices and lack of inventory as described below holds true for most major condo developments throughout Greater Downtown Miami.
If you haven’t heard, the real estate market in Miami is once again heating up and prices for condos at Marina Blue are following suit. Demand is high and inventory is low, paving the way for a strong 2013. Just how strong you might ask? I decided to crunch some numbers to help answer that question.
The left-hand side of the chart below graphically illustrates various statistics regarding asking prices in 2011 (blue), 2012 (red) and 2013 (green). There haven’t been any closed sales thus far this year so the right-hand side of the chart illustrates only sales that took place in 2011 (blue) and 2012 (red). It should be noted, however, that currently there are 4 pending sales at Marina Blue.
In 2011, there were a total of 33 closed transactions which sold at an average price of $324,806, or $299 per square foot. In 2012, the number of closed sales increased 73% to 57 and sold at an average price of $378,495, or $329 per square foot. Due to outlying sales that skew the averages, the median sales price can sometimes provide a better sense for the overall market but that is not the case with this data set. The average and median figures for each year are relatively in line with each other. The average sales price increased 16.5% from 2011 to 2012 while the average price per square foot increased only 10%. This indicates that a greater percentage of larger units sold in 2012 than in 2011.
That brings us to the present day. As of January 14, 2013, there were 29 condos available for sale at Marina Blue. These units ranged in price from $355,000 to $2.8M. The average list price is skewed dramatically, however, due to one listing that is way off base. In this case, the median list price of $515,000 provides better insight into the overall market than the average list price of $698,793.
The chart below follows the same format as the chart above but breaks everything down on a price per square foot basis.
When comparing current availability with closed sales in 2012, it should be immediately clear that current asking prices are very high relative to where condos have sold in 2012. The median sales price per square foot in 2012 was $326 while the median asking price per square foot is currently $452. That is a huge gap but presents a big opportunity for someone who is looking to sell fairly quickly at an above average market price. To be clear, I feel that the average unit will now get $370-$380 per square foot. That is a very healthy premium when comparing it to the median sales price per square foot in 2012. Obviously, units on high floors with above average build-outs should fetch even more.
As inventory dwindles, I have noticed that more and more condo owners throughout Miami are starting to raise their asking prices. For example, of the 62 units currently available for sale at 900 Biscayne Bay, 13 of the owners have decided to increase their offering price since initially hitting the market. At Ten Museum Park, 6 of the available 22 units are now offered at a higher price than was available just months ago. A similar trend can be seen at plenty of other major condo developments throughout Miami as well. Sellers are taking advantage of the low inventory and are adjusting their offering prices accordingly.
Brickell Condo Market Expected to Remain Strong Throughout 2013 and 2014
As of late, little has been said about the fact that myBrickell and 1100 Millecento are completely out of inventory. With the exception of two very large penthouses, the same goes for BrickellHouse. Take a moment to digest that piece of news. Of the 948 combined units that these three developments represent, only two remain available. That speaks volumes about the strength of this real estate market in Miami. 192 units at myBrickell are scheduled for delivery towards the end of this year and the balance of condos from the two other developments are not expected until the end of 2014. In the meantime, demand remains high so existing condo inventory should continue to dwindle. There isn’t much help on the way in near term either. We know that there will be a residential aspect to the highly anticipated Brickell Citicentre, which is currently under construction, but no sales information has been released as of yet. Regardless, completion of those condominiums would not be expected until 2015 at the earliest. We also know that Related Group recently purchased the Infinity II site located at 1300 S Miami Avenue. It is highly likely that sales for condominiums in that project will be announced sometime during the first half of this year. The site is approved for a 65-story tower with 556 total units so don’t expect those units to be delivered any earlier than mid-2015 unless the project is massively scaled back. Lastly, there has also been mention of Panorama Tower and Villa Magna but both projects will be rather massive so inventory in either wouldn’t be expected until late-2015. In summary, I think it is relatively safe to say that, barring any global economic meltdown, prices for condominiums in Brickell should enjoy a steady rise throughout 2013 and 2014 given the lack of inventory that will exist over the course of that time period.
By the way, the two remaining penthouses at BrickellHouse are priced at $2,396,000 for 3,500 interior square feet and $5,200,000 for 7,500 interior square feet. No matter how you slice it, sub-$700 per square foot for a penthouse in a building of this caliber is an amazing deal.
One Thousand Museum’s Likely Impact on the Neighborhood
Last month, it was announced that world-renowned architect Zaha Hadid has been appointed to design a luxury skyscraper in a neighborhood of Downtown Miami know as Park West. The residential high-rise, known as One Thousand Museum, will be developed by Gregg Covin, the developer behind Ten Museum Park, and Louis Birdman. The planned project will be erected in what is the current location of a BP gas station which neighbors Ten Museum Park at the intersection of Biscayne Boulevard and Northeast 10 Street. Sales information is expected to be released during the first half of 2013.
There always seems to be a sense of excitement surrounding the announcement of a new development in Miami and the news of 1000 Biscayne Tower was no different. Not everyone, however, shares the same sentiment. Residents in the immediate area are not always thrilled about the inevitable noise, traffic congestion and their views potentially becoming obstructed due to the new construction. Taken yesterday evening, the picture above shows not only the site of the BP gas station but also its neighboring condo developments – 900 Biscayne Bay to the south and Ten Museum Park to the north. Due to their proximity, it should be clearly discernible that views in each high-rise from units closest to 1000 Biscayne Tower will be significantly affected. To be exact, there are three lines in each development which will have their views hindered: the 08, 10 and 12 lines at 900 Biscayne Bay and the 01, 07 and 08 lines at Ten Museum Park. The following site plans illustrate where these lines reside on each building.
Below is my assessment on how the view of each of these lines will be affected:
08 line – Earlier this morning, I showed an 08 line at 900 Biscayne Bay and made sure to make a mental note of what the view looked like from the living room. In this floor plan, the master bedroom is to the left of the living room and the second bedroom is to the right, with all three rooms facing in the same direction. Of the three lines at 900 Biscayne Bay that will be affected by the erection of 1100 Biscayne Tower, the 08 line will be affected the least. Notice the setback that Ten Museum Park has from the sidewalk. 1000 Biscayne Tower will have a similar setback and, therefore, the water view from the 08 line will, for the most part, not be obstructed. Having a massive building directly in your line of view is definitely less than optimal but at least these residents won’t have their water view compromised.
12 line – At first glance, it might appear that the 12 line will have their views most adversely affected due to it being the furthest line away from the street but that’s not the case. There’s no doubt that its water view will be most compromised of the three lines but one must remember that this uniquely situated floor plan also has views to the south and west. The west view at night is stunning and the development of 1000 Biscayne Tower will in no way take anything away from that. These residents will still be able to enjoy a view of the sunset from within their unit and should still be able to enjoy a view of the sunrise from their balcony.
10 line – In my opinion, residents who live in a 10 line at 900 Biscayne Bay have the most to lose in regards to their view being obstructed if a high-rise is indeed constructed on the current site of the BP gas station. The 10 line is boxed in on either side by the 08 and 12 lines and will look directly into the southern end of 1000 Biscayne Tower. Their water view will likely go from unimpressive to highly obstructed in a jiffy. Any semblance of a view that might remain will be further compromised by the almost certain development of the Miami Herald site in the future.
The impact such a development will have on the views of the units located on the southern end of Ten Museum Park is much easier to assess. The footprint of the building is perfectly symmetrical and, therefore, the units located on the northern end which look into Marquis Residences serve as a perfect example for what views will look like from the 01, 07 and 08 lines in the future if a development is constructed at the site in question.
01 line – This line offers a direct water view and the water view will in no way be affected by the development of 1000 Biscayne Tower. Privacy from the living room might be a concern but it’s nothing that solar shades or long curtains can’t fix. Besides, privacy at this end of the building hasn’t been expected since 900 Biscayne Bay began closings in 2008. Take a tour of an 04 line to get a sense for what it will feel like to have a building so close.
07 line – Like the 12 line at 900 Biscayne Bay, this line offers a view to the south and west. Its southern view will be compromised but its view to the west will be unaffected. Your view of the water will be slight at best. Take a tour of an 06 line to see what I mean.
08 line – The view from the 08 line will be obstructed the most by the development of 1000 Biscayne Tower. Residents will look right smack into the northern end of the planned high-rise. The 05 line will give you an uncanny feel for what life will be like having a view of the side of a building.
Within the past five years, Park West, the neighborhood name given to the area immediately west of the upcoming Museum Park, has undergone a transformation that has been nothing short of amazing. One could argue that the addition of 1000 Biscayne Tower, as well as the oft-mentioned 700 Biscayne Bay which will be located just south of Marina Blue, is just another step in the progression of Downtown Miami. Such additions should no doubt strengthen Park West’s positioning as one of Miami’s most luxurious neighborhoods. I wrote about this inevitable progression in a blog post back in July 2007. In it, I referred to the neighborhood’s development as Miami’s equivalent to Manhattan’s Park Avenue. There’s no question that Park West has not yet arrived at its potential but there is little doubt that it is well on its way. While short term demand for condos in the lines mentioned above will likely wane due to having to deal with construction noise outside your window as well as the loss of views and privacy, it is difficult to jump ship from a neighborhood that is heading in the right direction with lots of upside potential. Across the street, the $220M Miami Art Museum at Museum Park is scheduled to open later this year with the Miami Science Museum following about a year later. Additionally, there has been a lot of talk as of late regarding Miami Worldcenter indicating that the mega-development may not be a pipe dream after all. If Miami Worldcenter is formerly announced and becomes an actuality then, mark my words, Park West will become the most highly sought after neighborhood in Miami. You can take that to the bank!
HGTV’s 2012 Urban Oasis at Paramount Bay Hits the Market for $1.25M
This past October, HGTV awarded James Walley, a lucky viewer from Texas, a posh, two-bedroom condo at the prestigious Paramount Bay. Not even two months later, that very unit has hit the market with an asking price of $1.25M. This should come as to no surprise as the winner, come April, will owe a pretty hefty tax bill to the government. The fully furnished and impeccably decorated 2 bedroom/2.5 bath condo is being sold turn-key. The unit has 1,751 interior square feet, a private elevator and resides on the southeast corner of the building offering spectacular views of Biscayne Bay, the Atlantic Ocean and the Miami Beach skyline.
For a full rundown on what this stunning condo has to offer, watch the 90-second guided tour below provided by interior designer Brian Patrick Flynn.
Miami Condo Prices Up 16th Consecutive Month
Miami condo prices continue to improve. The median sales price for condos throughout Miami-Dade County has increased for 16 consecutive months, according to a market report released last week by the Miami Association of Realtors. In October, the median sales price of condominiums in Miami-Dade County rose 24.2 percent to $146,000 compared to a year earlier. Inventory of overall residential listings continues to shrink as well. There are currently 4.2 months worth of supply throughout the county. Over the past year, inventory has gone down 22.2 percent from 15,127 to 11,769 listings.
IconBay to Include Garage-top Tennis Courts and Watersports Marina
Rooftop tennis courts? Why didn’t anyone say anything? I’m not an avid tennis player but I wouldn’t mind partaking in a few games of tennis if they were to be held on a rooftop offering a majestic water view. Heck, I’m not even a tennis player period but I might just volunteer to be the line judge. Where do I sign up? One of IconBay’s latest renderings reveals two tennis courts atop its parking garage. It appears, however, that only one of the two courts will offer an unobstructed view of Biscayne Bay. I wonder what the wait time for that court will be. The tennis courts at IconBay will be located on the 7th floor and offer ball and towel service, filtered water stations and access to his-and-hers locker rooms. The courts will even be lighted to allow for nighttime play.
It seems that recreational activities and encouraging its residents to live a healthy lifestyle will be a central theme for Icon Bay. Icon Bay’s latest marketing piece states that it will include a watersports marina for windsurfing, paddleboarding, sailing, jet skiing and other motorized and non-motorized aquatic activities. How awesome is that?
The waterfront sculpture park will also be a distinguishing feature for Icon Bay. Featured artists will include: José Bedia Valdes, Carolina Sardi, Edouard Duval Carrié , Gary Nader and Daniel Maman. In the rendering above, notice the dog park, sculpture garden, exercise stations, play fountain and interactive sculpture along with the winding walkways and baywalk. Sounds like it will be one helluva park!
The Infinity-edge pool at Icon Bay will be accented by a snack and cocktail bar and private cabanas. Towel service will also be offered.
The fitness center and spa at IconBay will include top-of-the-line cardio and weight training equipment, sauna and steam rooms, personal trainers, yoga and Pilates classes and more.
Notice the triangular-shaped balconies on the backside of the building in the above rendering of IconBay. You also get a good shot of the two tennis courts. I must say that these latest renderings have me excited about the prospects for IconBay. It will definitely be a game-changer for the neighborhood. Hopefully the watersports marina will be open to non-residents as well.
I updated our Icon Bay building profile page to include all of the latest information that has been released including amenities and residence features.
900 Biscayne Bay’s Attention to Detail
There are several reasons for why 900 Biscayne Bay gets a 9.5 out of 10 quality score on our Condo Rankings page. The building management’s attention to detail is definitely one of them. In the photo above, take note of the pattern across the back of the sofa. Each morning, the cleaning person vacuums this pattern into the back and sides of each of the sofas that reside in the club room at 900 Biscayne Bay. Attention to small details like these that don’t go unnoticed by the most discriminating of buyers.
