Hyde Midtown Prepares To Open Its Doors
We’re going to take a short break from our Art Basel Trophy Property series today to share some very exciting news. Don’t worry, we’ll still bring a trophy property as well, but this is too exciting to not share. Hyde Midtown is preparing to open this month!
According to a Facebook post by Carlos Rosso, Related Group’s President of the Condo Division, the new development is slated to open in just four weeks. This would keep them right on track with the estimated opening date of Winter 2017/2018. He shared these photo previews of the lobby area, and mentioned to us privately that the hotel portion should be ready to start taking reservations in about 60 days.
The Midtown Miami project is currently 90% sold with prices starting in the low-mid $400,000’s.
The Ultimate Market Stat Monday: Downtown Development Authority’s Mid-Year Report
Despite the fact that many media outlets and whispers in the marketplace would leave you to believe that the cards are stacked against us in the Miami condo market, things really aren’t so bad according to the Downtown Development Authority (DDA) Mid-Year 2017 Report. As they state in the report, “2017 has not been the best of times, but it hasn’t been the worst of times either.”
I have included the full 28 page report below, but also a synopsis…
RENTALS
The report separates the rental market into two sub-categories. Conventional rentals are the rental-only buildings that are all managed by one company. 2017 has brought 969 new rental units to the market, leaving just under 3,600 under construction. The condo rentals are considered shadow inventory since there is no way to tell whether a unit would be a rental, resale, or final sale until after delivery.
Amazingly, despite increased inventory, rental prices have increased slightly in conventional rental communities. I had previously been skeptical about the rental community market with so much inventory going up, but our neighborhood is very attractive and people are flocking in.
The segments of the rental market showing the biggest price gains are 1 bedrooms and 3 bedrooms, showing 3.4% and 3.6% growth since last year respectively. Studios are showing a slight decrease in price, but I suspect that this is due to the fact that tenants who would typically take a studio are now taking one bedrooms. Three bedrooms are less plentiful in the neighborhood, so are almost always a good investment opportunity.
PRE-CONSTRUCTION
The market in new developments is also hanging on. The researchers report that 2016 and 2017 YTD have garnered about 50% of the sales experienced in 2015, which experienced 25%-50% less than 2014. It’s undeniable that things have changed, but we will survive and the projects will be sold.
While the market has slowed markedly, projects that are currently under construction and 55%-60% sold do not seem to be in distress, according to the researchers.
One submarket that could flourish in the upcoming 18 months is the smaller-scale boutique project market. According to the report and our experience, these developments tend to capitalize on infill lots between the larger developments and do very well when the larger buildings slow down.
RESALES
Our resales are facing a tremendous amount of inventory with a 6% decline in overall pricing since last year. From July 2016 to June 2017 there were an average of 99 resales sold. That rate needs to be raised by an additional 500-700 listings sold per month to reach pricing equilibrium.
The conclusion of the report is that because so many new construction projects continue to be delivered and fewer projects are announced, we could see some stability in 2018 if nothing crazy happens.
Miami Downtown Development Authority 2017 Mid-Year Report by Sarah Elles Boggs on Scribd
The Hyde Logo Has Been Installed At Hyde Midtown
Related Group and Dezer Development are putting the finishing touches on Hyde Midtown, which is slated to open its doors by the end of the year. The project will bring 410 condo residences and 60 designer suites, which are managed by SBE Hotels, to the live-work-play neighborhood.
Because the development is nearly 90% sold, the developers have lowered the deposit requirement to just 30% for remaining inventory. They are also offering additional incentives with hopes of opening yet another fully sold building by the end of the year. The incentives include a leaseback program that guarantees a lease rate of $3 per square foot for one or two years after closing (depending upon the unit), or buyers could choose a fully finished and furnished apartment, or HOA credits. They also have special in-house financing options.
Prices start in the low $400’s. You can preview the views and finishes here, from our hard hat tour back in March.
Hyde Midtown Adds MORE Incentives, Opens In 4 Months
It seems that Related Group is very interested in opening another building in sold-out status. In May, they introduced a two-year leaseback program that guarantees income to rental investors at Hyde Midtown, and now they have stacked on more incentives. Not only are they offering the apartments finished, they are also offering furnished options. Buyers can also opt for credits that pre-pay their HOA and take advantage of seller financing.
Since the project is just 4 months from completion, the deposit structure has also been relaxed. Buyers can purchase with a 30% deposit rather than the previously required 50% deposit. Prices of 1 bedroom apartments, which include the leaseback program start at $405,900. The 2 bedroom apartments that include finishings and furnishings start at $597,900 and penthouses with 20 foot ceilings start at $754,900.
Which Miami Condo Developments Are On Highest Ground?
The threat that climate change presents to Miami is as hot of a topic as it is a polarizing one. With increasingly frequent flooding due to storms and the moon/tide cycles, many of the locals have grown familiar with the low-lying hazards in the neighborhood. A summer storm wouldn’t be complete without the dramatic shot of a newscaster standing outside the Publix in Mary Brickell Village with water up to their knees, gawking at drivers who splash by, many of whom end up with water damage to their pricey rides. The intersection of Brickell and 13th Street is another spot that overflows quickly.
After the storm we went through last week that flooded the underground parking garages at Brickell City Centre plus all of Mary Brickell Village, forcing shops to close for a day and a half, I started to wonder which buildings in the area are on higher ground? Some may be surprised to learn that the Downtown area is not flat. There are small, but valuable hills that make certain buildings more secure from the floodwaters. I did a little bit of research and found this very interesting topographical map that is fully interactive and mapped the buildings in our area. The vast majority of the buildings sit between 0-3 feet above sea level, but here are the ones on higher ground…
Simpson Park Area
On the south end of the Brickell Financial District but on the north side of South Brickell is Simpson Park. It is situated on a small hill that crests at the intersection of SW 1st Avenue and I95 at 30 feet above sea level. Le Parc at Brickell is the highest condo development in our service area at 20 feet above sea level. Nearby, Infinity at Brickell also takes advantage of this hill at 10 feet above sea level, but it drops off quickly. SLS Brickell measured 3 feet above sea level.
Because of the contour of the elevation, Vue at Brickell and Axis at Brickell were all showing up as 7 feet above sea level, leaving Millecento and the rest of the surrounding buildings at 3 feet.
North Brickell
All of the other buildings in Brickell are between 0-3 feet except for one small incline at 5th Street that puts 500 Brickell’s East Tower on slightly higher ground (7 feet).
Downtown Miami
The wall of towering skyscrapers along Biscayne Boulevard in Downtown has been affectionately dubbed the “Biscayne Wall” in real estate and architecture groups for some time now, but there could be another reason for it. There is a small increase in altitude along Biscayne Boulevard, leaving Bayfront Park at 3 feet above sea level and all of the condo developments from 50 Biscayne to Marquis Residences at 7 feet above sea level. This includes Vizayne North and South, MarinaBlue, 900 Biscayne Bay, One Thousand Museum, and Ten Museum Park.
Just a bit farther inland, Centro, The Loft Downtown, The Loft 2 Downtown, and Paramount Miami Worldcenter are all also 7 feet above sea level.
Edgewater / Arts & Entertainment District / Midtown
As can likely be expected, none of the buildings in Edgewater are higher than 3 feet above sea level… but the grade increases relatively quickly as you go farther west (by Miami standards anyway). The Arts & Entertainment District’s new project, Canvas, is 7 feet above sea level, and industrial loft or live/work space fans will be pleased to hear that Parc Lofts and Filling Station Lofts are both built 10 feet above sea level.
Midtown fans will also be pleased to know that the entire neighborhood, including Midtown 2, Midtown 4, Midblock and the new Hyde at Midtown are all 10 feet above sea level.
Final Thoughts
If you would like to play with the interactive map on your own, you can do so here. Do the findings make you feel better or worse about our situation?
Midtown 5 Announces 4,000sf of Wellness Space In Ground-Level Retail
Tenants of the newly-completed Midtown 5 will soon be able to refresh their look without leaving the building. Magellan Development Group has announced that they have signed retail lease agreements with “The Biostation” and “Omni Nails and Lash Lounge.”
The Biostation is a medspa that specializes in preventative medicine and counteracting the signs of aging to help replenish vitality, health and youth, according to their press release. Offering a highly- personalized, scientific approach to total wellness, the medspa features a wide-ranging menu of treatments administered by one of several doctors or registered nurses. The 2,716-square-foot space will serve as the biostation’s second South Florida location.
Omni Nails and Lash Lounge will outfit 1,415 square feet with all the necessities needed for relaxing pedicure and manicure services, as well as facials, eyelash extensions, permanent make-up and waxing. This all-encompassing salon will have expert beauticians on hand to customize the variety of treatments offered to meet clients’ needs.
Midtown Five offers studios, one, two and three bedroom residences ranging from 540 square feet to 1,500 square feet.
Hyde Midtown Offers Leaseback Program On Remaining Inventory
Image by Carlos Rosso
Hyde Midtown is on the home stretch toward opening day and making moves to ensure they achieve sold-out status prior to then. To set themselves aside from the competing buildings, Related Group is now offering a leaseback program to investors on select units. This guarantees the investor a 2 year lease at $3/square foot, starting from the day of closing.
The program appears to be working. Between the last quarter of 2016 and the first quarter of 2017, the project moved from 78% sold to 80%. As of today, 85% of the units have sold. To be fair, the increase in sales is not only due to the added incentive. The last quarter of 2016 was uncharacteristically slow. It all started with Hurricane Matthew distracting people from buying condos. As soon as Matthew passed, the storm that was the election delayed a rebound… then the holidays. Thankfully 2017 has brought increased traffic and the leaseback program is something that investors appreciate, as evidenced by the 20+ sales that have gone down in the last 2 months.
For buyers who are not investors, they also have programs that offer flexible deposit structures and a credit at closing for the first two years of HOA payments.
The project is co-developed by Related Group and Dezer Development and is set to open in October. It will bring 410 apartments, Hyde music lounge & piano bar, cuisine by SBE’s world renowned restaurant group, and a luxury spa and fitness center, among other amenities. We were able to go for a photo tour on the day they topped off. Have a look at the finishes here.
The units at Hyde Midtown are competitively priced as well. The remaining units include:
- Two story penthouse units with sunset views from $754,900.
- One and two bedroom units with sunset views from $459,900.
- Three bedroom corner units starting at $859,900.
Do you think they will ultimately sell out before opening day?
Hyde Midtown Is 80% Sold And Has Topped Off
The Related Group, Dezer Development and Moss Construction celebrated their topping off of Hyde Midtown Suites and Residences with a string of parties and construction tours. We were lucky enough to be invited to preview the views and finishes of the project, which is now 80% sold.
The remaining inventory is all in the residences section, the 60 suites have already sold, as did the hotel. The prices start at $435,000 for a 779 square foot 1 bedroom with 1.5 baths and a view of Wynwood. A 1 bedroom with a den is $460,000 and 2 bedrooms start at $540,000. There are four remaining penthouses ranging from $735,000 up to $2,035,000.
During the tour, the hotel, lobby and amenity deck are all very much still construction sites. Some of the apartments and suites already had the kitchens installed, so we were able to preview those. They’re coming out very nice!
When finished, the amenities will include a tennis court, putting green, flow-through infinity edge pool, dog park. The Related Group’s President of the Condo Division, Carlos Rosso, said that the plans for a children’s playground were removed and jokingly announced that they had added a modeling agency. There are already several modeling agencies in Midtown, so I wouldn’t be surprised if that ended up coming true, even if he was joking with the announcement.
They also had celebrations for the 400+ construction workers who contributed to the building and will be having another event for the agents who have sold there. Carlos Rosso said, “This milestone gets us one step closer to delivering the Hyde lifestyle to Midtown Miami. The property offers everything that today’s buyers are looking for. Its unrivaled list of amenities, chic design by David Rockwell and enviable central location all add to what makes this development stand out from the rest.”
Here is a preview of what we saw. The building is on schedule to open in October of this year.
Kitchen Finishes
East View
Northeast View
Southeast View
South View
Amenity Deck
The rooftop palm tree, celebrating a successful top-off
Thank you, Carlos for the tour!
Midtown 2 Loft Sells For $260/square foot – The Lowest Price Per Foot Since 2013
After 11 months and 3 weeks on the market and an almost 20% discount, a buyer has found a bargain in this enormous loft unit at Midtown 2. The buyer was able to snap up the property for a record amount of $1,425,000, which works out to $260/square foot. It had also been available as a rental for $9,500/month.
The last time an apartment at Midtown 2 sold for such a low price per square foot was way back in 2013. That sale was also a loft unit, albeit smaller. It was Unit L61, a 1,410 square foot loft that sold for $212/foot. According to our Midtown 2 Sales Stats page, the average sales price per square foot has held pretty steadily around $420-$425/square over the last 2 years.
Despite the low sales price, the seller still did quite well in the transaction. They had purchased the unit back in 2012 as a part of a bulk sale for $800,000. The property is a beautifully redesigned 4 bedroom with 3.5 baths, 30 foot ceilings and over 5,400 square feet of living area! Full disclosure, you can see in the MLS photos that the construction of Hyde Midtown is partially obstructing the view, but this is part of city life.
With the new wave of inventory coming up over the next year, how much more do you think prices will be affected in Midtown?
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.
