DEAL ALERT: Developers Offering Attractive Close-Out Pricing on Existing Condos

While the market is buzzing with attractive pre construction investment deals not many people think to inquire about the buildings that are existing and still have a bit of inventory For some investors these existing buildings can bring a better investment than the speculative development deals that others are flocking to The close out phase of an existing building is actually one of my favorite times to sell in a project for a few reasons

1. Mitigated Risk
   The investor can see the actual building and apartment they are buying so much of the risk of the design and construction phase has gone by Since the apartment exists already the buyer knows exactly what they will receive not a photo of a building that they hope comes to fruition the way it is shown in the rendering
2. Faster Return
   If you buy existing inventory for purposes of a rental investment you can lease the property immediately You will be able to see your money work for you straight away while other investors wait to see how their investments will perform after the building is completed
3. Financing
   Mortgages become far easier after half of the apartments in a development have closed Since the lender can also see the building they know what their risk is and are more willing to lend money with lower down payments This is true for both local and international investors
4. Flexibility
   Developers are investors too and when they are in the close out phase they are almost finished with their project I dont care how many people say that there is no emotion in business that is wrong There is something emotional about being close to the finish line and that makes developers more eager to sell those last apartments to get to their goal Many times we see developers offering HOA credits discounted prices and special leaseback programs to entice buyers into helping them reach their goal If buyers can reach their goals by helping developer reach their goals isnt that a perfect scenario I think so

With these points in mind I have a prime example of a building that is currently in this situation

City24 is a boutique luxury building in Edgewater with 119 apartments It was originally built in 2008 and has all of the amenities and finishes that residents of the neighborhood have come to expect There is a 24 hour doorman gym pool jacuzzi secured garage parking the apartments have stainless appliances and quartz countertops with tile or wood floors washerdryers in the apartment pretty views easy accessibility to restaurants and fun events the things we look for in the Downtown Miami area

Out of the 119 original apartments the developer needs to sell only 6 more in order to be finished We have toured the remaining 6 and have not seen a reason that these specific apartments remain unsold The developer is offering the full inventory for $25M which works out to roughly $385square foot Naturally if one investor were to purchase all 6 apartments a lower price or additional perks would be considered

At the offered price the remaining apartments would equate to a pre tax return of 5 when rented for full market value The typical investment apartment in the area today brings a 3 return so the buying investor would start off with an advantage on this package Additional parking spaces HOA credits or price negotiations would help the both the buyer and the seller while making good use of the property

If you would like more information on specific apartment numbers sizes prices or packages dont hesitate to reach out We can work together to present a package that meets your investment goals on this or similar projects