Super Bowl Sunday afternoon, I decided to walk around Brickell, Downtown Miami and Park West to provide those who reside outside of Miami a construction update for various condo developments. Below, you’ll find various pictures that I took during my walk:
500 Brickelllooks to be about 2-3 months away from being finished.
Icon Brickellappears to have topped off one of its towers and close to topping off the other two.
Met 2 will be comprised of two towers. One will be a 47-story high-rise comprised of Class A office space. The second will be a 42-story signature hotel called Marquis, a JW Marriott Collection Hotel.
Asia is located in Brickell Key. Probably another 2-3 months until this luxury high-rise is ready to begin closings.
Met 1 is the white tower located in the center with the Wachovia building hovering directly behind it. Met 1 is complete but I’ve yet to hear for when the first closing is scheduled. Has anyone heard anything?
Marina Blue, 900 Biscayne Bay, Ten Museum Park and Marquis. Marina Blue is just about done and should begin closings very soon. Gotta love the architecture and glass on Marina Blue! 900 Biscayne Bay will probably begin closings sometime within the next 2-3 months. Although closings at Ten Museum Park began in the Summer of 2007, the amenities and spa are far from being 100 percent complete. Hopefully by July we can file it away as being completely finished. Marquis still has quite a ways to go before being topped off.
New Miami Condos – Closings Rates for January 2008
The chart below will show you the percentage of total units that each development has closed since closings began. Click on the following links to view the updates in November and December:
Before anybody says it, I realize that One Bal Harbour is not a “Miami Condo”. I didn’t want to change the title of the post just to reflect the fact that One Bal Harbour is located in Bal Harbour. I also didn’t want to exclude it from the list because there is much interest in One Bal Harbour, and besides, One Bal Harbour owners would criticize me for not providing an update when the closing rate has jumped since the last update.
The closing rate at One Bal Harbour has hit the 70 percent mark. This is a significant increase since last month’s update. The stock price of WCI surged about 15 percent in the regular session on Wall Street and another 19 percent in after-hours trading on Wednesday after it reported that it has successfully been able to amend its credit and loan agreements. The news story was not publicly disclosed until after the bell. There are currently 55 condo units that have not closed, according to public records. The news reveals that WCI now has a considerable amount of time to sell these last remaining condos.
Ten Museum Park has had about a 7 percent increase in its closing rate while 50 Biscayne has had about an 18 percent increase, since the December update. With the exception of One Bal Harbour, Ten Museum Park and 50 Biscayne, none of the other developments have had an increase of over 5 percent. The two new entries to this month’s update are Loft Downtown 2 and Quantum on the Bay. Loft Downtown 2 should have been included in the November update since closings began in September but it simply slipped my mind. Sporting a 74 percent closing rate, however, makes Loft Downtown 2 appear quite successful in comparison to the other Miami condos. The Grand Opening Party for Loft Downtown 2 is scheduled for Thursday evening.
Closings at Quantum on the Bay began earlier this month and as I’ve stated many times before, closings can take up to 2-3 weeks before they are recorded with the county (however, I have heard that as of January 1, 2008, this is no longer the case. A reliable source told me that a step that sometimes delays the process is no longer required. Closings should now be recorded within 1-2 days after the condo has closed. Can a title agent elaborate on this for me?). Don’t take too much away from the low closing rate at Quantum on the Bay. I mainly included it to act as a stepping stone for next month’s update and let everyone know that it is now on my radar.
Update: New Condo Construction Closing Rates
The chart above will show you the percentage of total units that each development has closed since closings began.
One Bal Harbour is the newest edition to this monthly update. Closings began November 16, 2007. The percentage of closings may seem very low but keep in mind that it can take up to three weeks for closings to be recorded. However, it normally takes about five days for closings to be recorded. I know for a fact that several extensions have been granted at One Bal Harbour. I have a client who is planning to close on his unit this upcoming week. He will then sell it for a sizable loss to a replacement buyer who contacted me a few weeks ago in a simultaneous closing. I can tell you that WCI has delivered a fantastic product. An investment group that I met with today told me, after seeing a large variety of condo developments throughout South Florida, that One Bal Harbour was by far their favorite. I viewed a $5.7M condo there this past week that was simply amazing!
If you compare last month’s graph to this month’s you will see that there hasn’t been much of a change. Latitude on the River went up about 2%, Star Lofts on the Bay has remained unchanged (they’re in trouble), Onyx on the Bay has gone up about 3.5%, Ten Museum Park has gone up 7.5%, 2 Midtown has gone up about 4.5% and 50 Biscayne has gone up about 6.5%.
I’m actually quite shocked that more closing haven’t occurred since last month’s numbers were released. I realize that the market is slow but I would have thought that 1 or 2 other condo developments would have hit the 70% mark. I especially thought that 50 Biscayne would have had an increase of at least 10%. These figures, when compared to last month’s, are quite an eye opener.
New Condo Construction Closing Rates
The chart above will show you the percentage of total units that each development has closed since closings began. They are in no particular order.
Below, you will find the date that the first closing in each development occurred:
Star Lofts on the Bay and Onyx on the Bay haven’t had any new closings in quite some time. I think they are pretty much done. Midtown 2 has maybe one or two new closings every couple of weeks. Might as well put a fork in them as well.
Latitude on the River has done comparatively well but it seems as if closings have plateaued. I think it will be difficult for them to reach the 80 percent mark within the next couple of months unless a bulk buyer steps in to buy the defaulted condos.
Ten Museum Park has been struggling but I know that an individual has stepped in to buy over ten units there within the past couple of weeks and is still looking to buy more. Only about half of these closings have been recorded. Rumor has it that a separate bulk buyer has a strong interest in buying the remaining units that come back to the developer of Ten Museum Park after all closings have been completed. I think by January we’ll see the percentage of closings at Ten Museum Park top 90 percent.
50 Biscayne began closings on October 1, 2007 and is doing quite well. Most closings get recorded within the first week but there can be a two to three week delay so some condos that have closed within the past two weeks may not be reflected in the numbers above. It will be interesting to see how high the percentage of closings at 50 Biscayne rises by the end of the year.
Latest Prices at Ten Museum Park
Below you will find the latest prices for units at Ten Museum Park. These are defaulted units that were taken back by the developer. They have been discounted 15 percent off of their original prices set in January of 2004. Contact me if you’re interested in viewing any of these units.
1 Bedroom/1.5 Bath – 858 interior SF/143 exterior SF
1608 – $335,000
3008 – $350,000
1905 – $325,000
2 Bedrooms/2.5 Baths – 1,239 interior SF/192 exterior SF
4106 – $450,000
2 Bedrooms/2.5 Baths – 1,906-1,949 interior SF/192 exterior SF
1602 – $799,000
2504 – $825,000
3 Bedrooms + den/5 Baths -4,005 interior SF/533 exterior SF
Sunday Afternoon Bicycle Ride Through Brickell and Downtown Miami
Last week, I purchased a new road bike. My hope was to not only get a good cardio workout while cycling but also to get some great pictures of Miami and South Beach condos while doing so. My goal today was to get some shots of the condo developments in Brickell and Downtown that were either recently completed or will be completed within the next year. Unfortunately, it was a very cloudy day as you will see below.
Closings at Plaza on Brickell will likely begin in January. This development will add 1,000 new units to the Brickell condo market.
Closings at 1060 Brickell should occur around the same time. 1060 Brickell will add 582 condo units.
Closings at Axis will likely begin around the middle of 2008. Axis will add 718 units.
Closings for 500 Brickell are scheduled for the beginning of 2008. This development will add 633 units.
Infinity at Brickell will likely be completed towards the middle of 2008. Infinity will bring 459 condo units to the market.
I forgot to get a shot of Brickell on the River South. That development will add 322 units. I also didn’t get one today for Latitude on the River but I’ve displayed pictures of that building in the past. Closings at Latitude started about two months ago. It has 455 condo units.
Asia is located on Brickell Key. It is the only development under construction there. It will add 123 condo units when it is completed in the first half of 2008.
Closings at 50 Biscayne began about a week and a half ago. I walked in the lobby last week and it is gorgeous. I didn’t have my camcorder with me at the time, however. I will try to get a video and picture tour of the building within the next week. 50 Biscayne has 529 condo units.
Closings at Loft Downtown 2 are scheduled to begin this month. In fact, they may have already begun. It will add 496 units.
Everglades on the Bay (now known as Vizcayne) likely won’t be completed until the end of 2008 or beginning of 2009. It will add 866 condo units to the Miami real estate market.
I’ve been told that closings at Marina Blue are scheduled to begin November 1, 2007. I don’t see that happening so soon but maybe I’m wrong. My guess would be sometime in December or January. Marina Blue will add 516 units.
900 Biscayne Bay will likely be completed in the first half of 2008. It will add 516 units as well.
Closings for units at Ten Museum Park began about three months ago. Closings are still underway. It has 200 units. Marquis probably won’t be completed until the end of 2008 to beginning of 2009. It will bring 306 units to the Miami condo market.
In conclusion, there might be a tiny bit of an inventory problem in Miami (that was me being sarcastic). I also didn’t include Icon Brickell and Epic Miami which will be completed in 2009. Icon Brickell will add 1,816 units while Epic will add 966 units. The condo developments in the Arts District will also add a little over 2,000 new units to the market within the next six months.
Trouble Ahead for Ten Museum Park?
Those of you who have closely followed my blog know that I’m a big advocate of Ten Museum Park, for reasons that I have cited in the past. I’ve predicted that, of the condo developments that are scheduled to close within the next six months, Ten Museum Park would have the least amount of problems.
After reviewing the number of closings, as of late, at Ten Museum Park, I pray that my prediction pans out to be highly inaccurate. If, however, my prediction does prove to be true, then the Miami condo market is in for a world of pain. As I said, I pray that my prediction proves to be wrong.
Closings for units at Ten Museum Park began towards the middle of June 2007. As of last week, a total of 76 closings have been recorded since the middle of June. There are 200 total units at Ten Museum Park. Those 76 units represent 38 percent of the overall building. What has happened to the other 62 percent? A total of 6 closings occurred in the previous 4 weeks prior to last week. Closings are grinding to a halt.
Closings for units on the upper 15 floors only began within the past 3 weeks, so perhaps a significant percentage of units on those upper floors will ultimately close. That’s best-case scenario.
I know for a fact that many contract holders at Ten Museum Park have been dragging their feet to reach the closing table by asking for extension after extension. When push comes to shove, what percentage of the remaining units will close and what percentage will default? At this point, the bank must be calling the developer three times a day.
Let’s be optimistic for a minute and say that 30 percent of the contract holders at Ten Museum Park ultimately default. What does that mean for the rest of the Miami condo market? If a highly regarded development such as Ten Museum Park can have default rates that reach 30 percent, then what lies in store for the remaining developments that are scheduled to be completed within the next 6-12 months?
I expected high default rates to occur at Ten Museum Park in their 05 line, because of the lack of views, but a high amount of defaults have spread to the 05, 06 and 07 and 08 lines as well. After personally touring these floor plans, however, they all seemed to be smaller than the square footage that was represented at contract time, so I shouldn’t be surprised. Only the 01, 02, 03 and 04 lines seemed to deliver an interior space that was promised.
I’ve also predicted, in the past, that of the condo developments scheduled to close within the next 24 months, Opera Tower would have the most problems. Originally, closings at Opera Tower were scheduled for August. Then, they were pushed back to September. I don’t foresee closings to begin at Opera Tower until early November. I won’t be surprised if closings don’t begin until the beginning of next year. From what I’ve heard, the amenity deck at Opera Tower is at least one month away from being completed. I’ve spoken with several contract holders at Opera Tower who have no intention of closing on their contracts.
If the best-case scenario for Ten Museum Park is to have a 30 percent default rate, then what will that mean for developments such as Opera Tower? 50 percent defaults? 60 percent defaults? Opera Tower has 635 total units. That’s a bitch-ass high number of condos that will remain unsold at Opera Tower if those estimates prove to be true.
Let’s pretend to be ultra-conservative in our estimated default rates. Let’s say that the condo developments that are scheduled to close within the next 24 months have an average default rate of 10 percent. I’ve previously cited that 16,070 new condo units would be delivered within the next 19 months. Using our ultra-conservative default estimate of 10 percent, this would mean that 1,607 units will not close. How long will it take to fill this void? Your guess is as good as mine.
Miami is a market that will once again see double-digit growth within the next 10 years. How long will it be until we reach that point? The land that I walk on each day is paradise. There’s no doubt about that. Even Tony Montana said it himself, “This is paradise,” and we all know that all he has in this world are his word and his balls, and he don’t break them for nobody. But Miami was overbuilt. Right now Miami is in an adjustment period. Once the inventory in the condo market is absorbed then paradise lost will once again be regained. But how long will that take?
I’d love to see your comments. How long will it take to fill this large supply of Miami condos?
My Prediction for Ten Museum Park
I’m going to go out on a limb and say that the east-facing units at Ten Museum Park will be selling 10-15 percent above where they are now by year’s end. I know, I know…the Miami condo market is in a rut. But that’s just my point. The east-facing units at Ten Museum Park are not condo units. They are lofts with 20-foot ceilings. Of all the high-rise developments in Miami, both existing and under construction, only Ten Museum Park can rightfully call themselves an ultra-luxury loft building.
Of the 200 units at Ten Museum Park, 73 of them have 20-foot ceilings with floor-to-ceiling windows. You will see that in future months there will be a premium paid for these units versus other units, not only in this building, but other buildings throughout Miami as well. I’ve already seen a lot of demand for these units in the past two months as some have been discounted due to original buyers not wanting to close. I think by the end of October the discounted units at Ten Museum Park will be nonexistent. The discounted loft units will be long gone by the end of September.
The amount of demand for units at Ten Museum Park has surprised even me, a big advocate of the development. The loft units at Ten Museum Park are truly something unique for Miami. They offer loft living combined with true luxury and gorgeous unobstructed water views, all residing in a neighborhood that, in my opinion, will be the best in Miami within the next five years.
Parc Lofts is a loft building in its truest form, but it is an industrial loft with minimal water views from higher floors, and offers no luxury. I’m a huge fan of that development as well though because it offers something very unique to the Miami market. Star Lofts, which will begin closings shortly, offers lots of luxury but resides in a neighborhood that does not even come close to the neighborhood of Park West. The prices are much higher as well. I think we’ll see a large percentage of defaulted units there. Infinity at Brickell isn’t quite as luxurious, nor does it have the unobstructed water views that the east-facing lofts at Ten Museum Park can offer, but it is probably the closest loft development to Ten Museum Park that offers the kwan: views, luxury, neighborhood and best investment dollars too.
Much of the luxury at Ten Museum Park lies in what it has to offer above other Miami developments. Primarily, it has the Clinique La Prairie spa which is based in Switzerland. By many, it is considered the best spa in the entire world. People from all over the world have been flying to Switzerland to enjoy the lavish spa treatments for which Clinique La Prairie is well known. Some of those treatments promise to slow down the aging process. The Clinique La Prairie spa at Ten Museum Park will be the first U.S. spa with their name associated.
Secondly, Michael Capponi’s name is associated with Ten Museum Park. For those not local to Miami, the Michael Capponi name is synonymous with the abbreviation V.I.P. He can get you into any party, any restaurant and any event that is well attended. Residents at Ten Museum Park will be able to count on Michael Capponi to get them V.I.P. accommodations to any social gathering that is worth attending.
I think those two aspects alone rise Ten Museum Park to the forefront of all other Miami developments. However, Ten Museum Park is also a boutique building with only 200 total units. Most other developments in Miami have well over 400 total units. There are only 6 units per floor at Ten Museum Park. The east-facing units share one bank with two elevators with one another. The units residing on the west side of the building share a bank with two elevators which accommodates four units. This is another good reason to be on the east side of the building.
Marquis – The Fourth Luxury High-Rise Building in Miami’s Park West Neighborhood
I’ve been getting a lot of interest in Ten Museum Park from both local and out-of-state buyers. Most of them inquire about the developments in the immediate vicinity to Ten Museum Park, such as 900 Biscayne Bay and Marina Blue to the south, and Marquis to the north. One can get a good idea of how beautiful 900 Biscayne Bay and Marina Blue will be when completed by looking at the current progress in development. Marquis, however, probably won’t be finished until the middle of next year and, as can be seen in the picture above, much is left to one’s imagination. (The picture was taken July 7, 2007).
I wanted to share some photos that I took of the Marquis sales center back in 2005 to show people what the building is supposed to look like once it is completed. Marquis is an ultra-luxury building and, if I remember correctly, prices ranged from $700,000 to $15M. It will have 306 ultra-luxury residences on floors 15-67 as well as a 10,000 square foot spa/fitness center and boutique hotel aspect to it with 56 hotel rooms on floors 3-14. The architect behind Marquis Residences is world-renowned Arquitectonica, which also did Marina Blue and a myriad number of luxury condo buildings throughout Miami.
There is definitely a big price difference in units located on the north side of Ten Museum Park versus those residing on the south side. Most of this is due to the close proximity that Marquis lies to Ten Museum Park. I think the spread in prices will narrow once Marquis is completed and buyers see that having a building that will be one of Miami’s most luxurious addresses isn’t such a bad thing.
