Brickell Is The Best Neighborhood To Be In During a Hurricane. Here’s why. (UPDATED)
It’s been a long time, my friends. The last notable storm that hit South Florida was back in 2005, when Brickell was simply a banking center that emptied out at 6pm. Today, as we all sit in anticipation of Hurricane Matthew’s path, something occurred to me. I sure am glad that I live in Brickell. As far as safety and discomfort from a storm is concerned, I feel that Brickellians (or Brickellites) sure have it easy relative to other areas of South Florida.
We don’t have to worry about storm shutters.
Most of the residential buildings in the Brickell area were constructed with hurricane impact glass, so we don’t have to worry about the hassle of putting up our shutters. Sure, we have to clean off our balconies, but we dodge the issue of who is responsible for installing the shutters and sitting in the dark, should we decide to weather the storm at home.
Our cars are stowed away safely in the garage.
Since the parking garages in Brickell are typically in the pedestal of the building, our cars are safely parked in their spots. There is no need to worry about them blowing away or a tree falling on top of them. Also, because they are typically 2-12 floors above ground, your risk of losing your car to flood is relatively low.
We have 3 Publix locations.
Ok, so one of the locations is on the west end of West Brickell, but practically anywhere you live in the neighborhood, there is a Publix that is close enough to scurry into between swells in case you forgot something or need more beer and wine.
If you’re afraid to run to Publix, you could order from any of the countless delivery services. Sure, they may stop delivering during the storm itself, but service will be restored quickly and we can be back to our convenient living.
We will be first on the list when it comes to having power restored.
Speaking of getting back to convenient living, Brickell is one of the most populous neighborhoods in America. According to the Downtown Development Authority’s recent demographics report, there are an estimated 35,000 people living in our little neighborhood that is just over 1 square mile. We are also one of the biggest banking hubs in the nation. Because of this, the FPL regards Brickell as an important neighborhood to keep running. We are the first to receive power restoration after the hospitals. Other neighborhoods that are on the ‘high priority’ list are South Beach along Collins and Downtown Miami.
Several of our favorite go-to restaurants and bars will remain open.
Our friend and contact over at Swire, Jami Reyes, reminded me yesterday that Perricone’s is always open during storms. I also saw that The New Times has a handy list of eateries and bars that we can rely on in case we didn’t properly prepare. Here are the Brickell locations:
– Batch Gastropub: Batch is on SW 12th Street, just under the Hampton Inn. They have a full bar and amazing food (even though I still wish they would bring back their roasted peppers. Looking at you, Kevin). They also make their own Fireball, so there’s that.
– Blackbird Ordinary: This is on SW 1st Street just north of Mary Brickell Village. They have some pretty amazing craft cocktails and Jenga.
– Coyo Taco: Our local Coyo Taco is under Axis on SW 1st Street. I don’t think I really need to say more. It’s not Taco Tuesday, but it’s always time for Coyo Taco.
– PM Fish and Steakhouse: In case you’re feeling sophisticated, you can go to PM Steakhouse on 15th and South Miami Avenue for a fine cut of beef or a lobster tail.
– Perricone’s: This is a Brickell staple since forever. Perricone’s is on 10th Street, just north of Mary Brickell Village. Typically viewed as a romantic date spot and also a solid choice for a business lunch, they also have a generator and roll it out for storm days.
– Sushi Maki: They have recently moved from their original location and are now in the old Rosinella spot at 11th and South Miami Avenue.
– Tino’s: Next to Sushi Maki is Tino’s, the newest pizza location in Brickell and one of my favorites. Their pizza is top-notch. The service is really friendly and they have a really romantic secluded patio in case you visit between swells.
Does this mean that I’m skipping the preparation? No. I ordered enough LaCroix and flat water to get my family through the next few days and will pass by the store for beer and wine after work. I am thankful though that I’m not hustling with storm shutters.
If Flipping Preconstruction Condos For Profit Doesn’t Work, What Does?
Lucas acknowledged it back in November with his blog post about the success of IconBay. This week, both CurbedMiami and The New Times have concurred after a formal study proved that flipping preconstruction condos for a profit is a bad idea. The only person who makes money is the developer. But if that’s true, then why are preconstruction investments so popular in Miami?
Well for one, developers and their salespeople are incredibly savvy. They sell a dream. No investor should go into that transaction unrepresented by a trusted buyers’ rep. The representatives in the sales offices of the buildings represent the project, not the buyer. They may be supportive and have great ideas, but the sales center representatives exist and are paid to fill that building up. Always, and I mean always, have a buyers’ representative.
Aside from the savvy sales strategy, foreign investors are many times able to take advantage of our exchange rate, making their purchases less expensive than a dollar to dollar transaction. This is great, as long as everything goes according to plan over the next 2-3 years that the project is under construction. But what happens if something goes down in their country (or in the US), making the exchange rate not so attractive? (Looking at you, Brazil). These investors are now finding that their money has been parked in Miami without earning a return for the last 3 years and to add insult to injury, they are not able to resell their investments for a profit even if the exchange rate had remained favorable.
For those who like to watch currency conversion rates, we have a special treat coming up for you in the next week or so. Stay tuned, but for now let’s stay on topic…
What should the preconstruction investors do?
I am not trashing preconstruction condo sales in general, just preconstruction condo sales for short-term investment. New projects are a great idea for people looking to buy a new home, vacation home, or a long-term rental investment.
In my opinion, investors who have already purchased a condo from a developer should hold them until the inventory has absorbed. The rental values will fall over the upcoming years because the market is flooded, but the condos are still beautiful and we will bounce back.
People still want to live in Miami. The condos are beautiful, people love to be the first resident in a building, and we can chug along with the rentals until the oversupply is absorbed and prices will increase.
What about current investors who are eager to make a profit short-term?
One option to make a relatively quick profit in the Miami condo market is to buy in a building that has upside potential. This would be a building that is in the process of solving litigation, is nearly finished reselling a batch of distress sales, or has some other reparable defect. The defect would drive the sales price down, then resell after the issue has been resolved. I have had investors experience success in this strategy at the Vue at Brickell, Neo Vertika, and Latitude on the River in Brickell and Blue Condo in Edgewater.
One investor purchased an apartment through a foreclosure sale at Vue at Brickell in 2010 for $159,000 (true story). He leased the apartment for a couple of years and then resold it for $375,000 after the distress sales were all absorbed. He made a small return on the rental and then cashed out. Some of the buildings that I think are good opportunities now for this strategy are BrickellHouse, IconBrickell, and 500 Brickell.
We all know about BrickellHouse’s trouble, but once their parking situation is fixed, the sales prices will rebound. Since the rental prices haven’t been affected relative to the sales prices, it would be a good investment option. The same holds true for IconBrickell, although I anticipate their rental prices will be affected more than BrickellHouse since the pool area of Icon is one of the big draws for tenants there. 500 Brickell is still working through the litigation surrounding the Chinese drywall that was discovered three years ago, making mortgages near impossible and driving the sales prices down. Since the actual apartments have long since been repaired, it is a popular building for tenants.
Another strategy would be to buy an apartment in a building that has a unique quality that is attractive to tenants. Some of my favorites for this strategy are Jade Residences at Brickell, Infinity at Brickell, Blue Condo in Edgewater and MarinaBlue in Park West.
The views, layouts and quality of Jade are unsurpassed, making it a popular choice for buyers and tenants alike. It is one of the few buildings in Brickell that will always retain its view because it is direct waterfront.
The layouts of Infinity are unique, there are not many buildings that primarily offer duplex lofts in the neighborhood. The sales prices have been pushed down due to the fact that the SLS Brickell construction has blocked many of the east-facing views, but the building remains a popular choice for tenants because it is one of the only options for people who have large pets.
MarinaBlue and Blue Condo are sister buildings. They both have really great floor plans for roommates or families and tremendous views that are protected. Pets are welcome for tenants and they are in great condition despite being around 10 years old.
These are the buildings that I prefer to pitch to investors who are new to the Miami market. Preconstruction opportunities have their place, but in my opinion are better for vacation homes or primary residences than investors. Let me know which buildings are some of your favorites and why. I’m always open to hear other suggestions.
Friends of the Underline Host UnderLounge Event in Brickell
The Underline, Miami’s new 10 mile linear park that will be installed underneath the Metrorail tracks from Brickell to Dadeland South, is inviting everyone to a free festival at underneath the Brickell Station. The event is called The Underlounge and will take place Saturday, October 15 from noon-6pm.
There will be activities for all ages including face painting, the world’s longest mini-golf hole, interactive chalk art madala, pop-up dog park & pet costume contest, caricature artist, balloon animals, kids play, fitness classes, yoga, and of course – a DJ. I already have my dog’s camel costume ready to go.
The Underline is being designed by James Corner Field Operations, the same designer of the popular High Line in New York City. The $120 million project will be funded by donations from developers (including Swire’s $600,000 contribution), impact fees from developments built within 1,000 feet of the metrorail, private donations and was recently approved as an EB-5 project.
Construction is set to begin next fall on the Brickell segment. Initial funding for this segment was the first to be received and we are very much looking forward to utilizing this space!
The Bond On Brickell Resales and Rentals Hit the Market
Two months after receiving their TCO, the first resale listings and rental listings at The Bond On Brickell are available on the MLS. The listings include a handful of remaining inventory from the developer, some being sold finished and some decorator ready.
When we toured the building in August, we got a chance to check out some of the views and layouts. They seemed very much what I expected from a Rilea building. There weren’t any crazy attention-grabbing features like the crazy/creepy/cool LED displays at SLS Brickell, just very tasteful design with extremely high quality finishes. I was impressed with the suede and leather walls, the elegant simplicity of the common areas and the themed playroom. Being a new mom myself without a playroom in my building, I paid special attention to that part.
Prices of the apartments start at $319,000 for a studio, $469,900 for a one bedroom, $685,000 for a two bedroom, $1,200,000 for a three bedroom and $2,593,000 for the four bedroom plans. There are 19 available with 8 listings being resales and 11 are the last of the developer inventory.
For the rental options, there are 11 one bedroom plans available as of today. They range in price between $2,500-$3,300, depending upon whether the apartment has a den and view of the bay.
IconBrickell Condo Association Releases Scope and Dates of Pool Renovation
The condo association at IconBrickell sent out a newsletter today to all of the residents, detailing the scope and dates of the pool renovation that nobody is looking forward to. Apparently, the defects were discovered almost 5 years ago and they have been working all this time to find an efficient way to make the repairs.
According to the 2 page newsletter, the spa and fitness center will remain open but they confirmed the pool will remain closed until the fall of 2017. Surprisingly, the newsletter did not make mention of the special assessment that was was passed in June or a lawsuit for the defects. They did introduce the construction team and give a preview of the tiles that were chosen for the new pool. Why anyone would build a pool and not use non-slip tiles is beyond me, but here we are.
While all of the whispers have been circling about the massive repair, values in the building have already started to be affected. Rental prices are down about 10%. The problem is that the iconic pool is a big reason people choose to live at IconBrickell. People don’t really like living in a construction site, so the apartments there aren’t able to command the premium they once did.
Take as an example our listing of apartment 4104 in Tower 1. It has the double-height ceilings that people ask for in the building and a great view. Last year, we rented it for $2,600 and this year it has been sitting on the market since July… even with a reduction in price to $2,300.
In Tower 2, we have another rental listing, Unit 4103. It is the big 2 bed plus den plan that is one of the most popular in the building. The furnishings are gorgeous, and it also has the double height ceilings? It is also priced lower than the lease value of last year, but is sitting lonely since June.
Hopefully, the construction team that took almost 5 years to put together will work fast and do things the right way this time. Nobody is looking forward to the next year at IconBrickell except investors looking for a deal.
Aurora in Sunny Isles Offers Private Jet Service With Condo Purchase
In the race to offer the most over-the-top amenities and perks, the developers of Aurora in Sunny Isles have upped the ante by including a 1 year membership to JetSmarter with each condo purchase.
JetSmarter is a new service that offers seats in the empty leg of a chartered flight through a smartphone app and website. The level of service and amenities offered are the same as though the members chartered the flight themselves, thus users are flying private for a fraction of the cost. Flights are offered for free to members, with additional seats available for purchase at a discounted rate in case you may want to bring your friends. Membership dues are $10,000/year with a $5,000 initiation fee.
In the app, you can search by date, destination or aircraft type. Flights are offered around the world and custom charters are available. Aurora is a boutique community of 61 residences in Sunny Isles. Prices range between $900,000-$1,600,000. It is scheduled to begin construction by the end of the year and open in late 2018.
Check Out the LED Displays in the Motorcourt of SLS Brickell
When we went on our hard hat tour of SLS Brickell last month, our contact from the hotel mentioned an artistic LED display was going to be installed on the ceiling of the motorcourt. It seemed intriguing enough at the time, but I was anxious to go inside the building and didn’t pay much mind to the concept. Yesterday I noticed that the display is now live and it stopped me in my tracks!
On the ceiling there are circular LED displays scattered throughout and they each run a loop of a different scene. Sometimes the scenes are orchestrated together, sometimes they are completely different and sometimes they are all the same. I’m not sure whether this is a test run or if it will always vary, but the entire display is certainly attention-grabbing.
Some of the scenes are pretty and calming, some are inspirational and thought-provoking and some are downright creepy. How very Phillipe Starck. Here is a sample of one of the scenes. It features dancers dressed up like white goats and spelling out different phrases with their bodies. I found these costumes really creepy, but it still held my attention. What do you think?
A video posted by Miami Condo Investments (@miamicondoinvestments) on
Brightline’s First Locomotive Completes Track Testing
The First Brightline Locomotive from GoBrightline.com
The first of the Brightline locomotives has completed its track testing in Sacramento, according to an update on their website. It is an important milestone, running the diesel engine for the first time along with a host of other checks.
They tested the air braking system, software for all systems, the doors, fire detection system, audible warning devices, communication systems, interior and exterior lighting and the weight verifications. The entire test took three weeks to complete.
The trains will have ergonomic cab designs for the engineers as well as an integrated trainset system that will improve ride quality and make for a far quieter ride than a traditional train. Commuting between Miami and West Palm Beach is expected to take only one hour and complimentary wifi is available for the ride.
The locomotive is expected to be delivered to Florida later this year, with rail service commencing in the summer of 2017. The station in Downtown Miami is currently under construction and will include 200,000 square feet of retail, 290,000 square feet of office space, 800 residential apartments and a 95-story high rise.
The Brightline Locomotive Cab from GoBrightline.com
While everyone else in Miami is busy talking about the market slowdown, Ugo Colombo is busy selling condos. We were invited into their sales center this week for a lunch and pulse check of the project, now that they are under construction.
We last checked in with the project back in May, when they were around 50% sold. Today, they are 52% sold. That may not seem like an enormous gain, but let’s also remember how many condos they have to sell. According to my math, that’s around 11 condos so far this summer. Not bad! (And anyone who says anything negative about an 11 condo summer needs to back their challenge up with some really impressive sales figures. Thank you.)
Here’s the thing. The market is really difficult right now for projects that have no unique selling proposition. This isn’t the case for Brickell Flatiron. Ugo Colombo is one of the best developers in Miami. If you need proof, take a look at our skyline. The buildings he built in the 1990’s still look newer than the buildings that competing developers built within the last 5 years. Have you heard any bad press about a construction defect in an Ugo Colombo building? No. He builds luxurious buildings and he does it well. We expect Flatiron to age just as gracefully as her sister buildings, Bristol Tower, Santa Maria, and the Epic Hotel & Residences. This wasn’t part of the sales presentation, just my professional opinion after working in the neighborhood for the last 8 years.
Since the groundbreaking in March, the construction crew has been hard at it with the site work and foundation form set. The pilings are all being set now and we expect to see a foundation pour in January of 2017. Sales are still happening with 1 bedrooms starting in the $400’s. For the smallest 1 bedroom, that works out to roughly $550/sf… an amazing price for Brickell in mid-late 2016! It is also the same price we would expect from the 2008-built Icon Brickell, who is getting ready to have a year without a pool… so there you go. I wouldn’t be surprised if we see a price increase soon, but whatever. It’s still worth it.
