Mast Capital has acquired a Miami property near the Shops at Merrick Park from AT&T Florida for $10.9 million and plans to develop a residential tower.
Camilo Miguel Jr., CEO of Mast Capital, said the 1.02-acre site at 3811 Shipping Ave. is zoned for up to 20 stories and 153 residential units. He plans to build within the current zoning and include 15,000 square feet of retail. The property currently has a small telecommunications office and a parking lot for AT&T’s vehicles.
Miguel said he is buying the site because it’s near the Shops at Merrick Park in Coral Gables, which includes a dine-in movie theater and many restaurants, and a block away from the Douglas Road Metrorail Station. The transit system connects with downtown Miami, the University of Miami and Miami International Airport, among other locations. Another group of developers has leased the Douglas Station site from the county for a major mixed-use project.
“In a few minutes, you can be in any other major commercial corridor,” Miguel said.
Miguel said he hopes to break ground in about a year, once the sale is completed. Mast Capital, which plans to relocate its office from Miami Beach to a larger space in Miami’s Coconut Grove, has a handful of projects in the works. In Miami Beach, the company expects to complete 12-unit Louver House condominium in mid-June, Miguel said. It also owns apartment buildings in Key West and a restaurant building on Brickell Avenue.
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Miami’s rental apartment market is about to get smaller — literally.
Micro-units — compact, affordable apartments aimed at young, single professionals who want to live in popular neighborhoods without paying exorbitant rents — are sprouting up in Wynwood, downtown Miami and other desirable areas where prices make it impossible for younger people to buy.
Wynwood 25 rendering
Groundbreaking is scheduled to begin in July on Wynwood 25, a $100 million mixed-use project by Miami’s Related Group and the New York-based East End Capital. The 400,000-square-foot development will occupy 2.3 acres and include 289 rental apartments, ranging in size from 400 to 1,200 square feet.
By comparison, the average two-car garage is 480 to 625 square feet.
More than 80 percent of the apartments at Wynwood 25 will be studios and one-bedrooms, starting at $1,400 per month. A limited number of three-bedroom units will go for $3,200 per month.
“Our approach to the building is to think about the type of person who would be drawn to Wynwood and want to live there,” said Jonathon Yormak, founder and managing principal of East End Capital. “This is not the same as Brickell or Miami Beach.”
Yormak said he hopes the micro-sized apartments will attract what he calls “the creative class — not just millennials but simply people who have a creative mindset and appreciate the arts, the entertainment and the grittiness that is cool about Wynwood.”
Apartment Boom In Wynwood
Wynwood 25 is one of three major residential projects Related Group is developing in the neighborhood. Another rental apartment building, Wynwood 26, is a joint venture with Block Capital Group that will feature 176 micro-units. Groundbreaking is scheduled for later this year.
Related’s third tower, Wynwood 29, a partnership with developer Tony Cho will offer micro-condos ranging in size from 416 to 900 square feet and priced from $200,000 to $500,000.
“If you go to Wynwood, the streets are always full, day or night,” said Jon Paul Perez, vice president of Related Group. “We think the first developer that gets to the residential market there will be the most successful.”
Wynwood 25 will be the first residential building to break ground under the regulations established by the Neighborhood Revitalization District plan (NRD), a joint effort hatched in 2015 between the city of Miami’s Planning and Zoning Department and Wynwood’s Business Improvement District (BID). The plan aims to help guide Wynwood’s transition from an industrial district to a standalone, self-sustaining neighborhood..
“The NRD is driven to shape Wynwood into a mixed-use, vibrant neighborhood with places to work and live, in addition to the existing businesses and restaurants,” said Steven J. Wernick, an attorney at Akerman LLP., who serves as land-use counsel for East End and assisted in the joint venture with Related. “Over time, we’ll see a diverse group of people moving into Wynwood — people who want to be close to places of work, arts and culture and restaurants. This building is an economic catalyst for more development in the heart of Wynwood, and it adds a significant amount of units to the neighborhood’s housing stock.”
Vice rendering
Micro-units are spreading to other neighborhoods, too. Scheduled for completion in fall 2018 is Vice, a 464-unit apartment rental tower at 230 NE Fourth St., in downtown Miami. The building is part of a nationwide rollout by developer Property Markets Group of a 5,000-unit pipeline of apartments, dubbed PMGx, pitched at millennials and young professionals in cities such as Miami, Denver and Chicago. (A Fort Lauderdale tower is planned for 2020.)
Vice, a 464-apartment rental tower at 230 NE Fourth St., is part of a national rollout of micro-units by developer PMG. Construction is scheduled to be completed by fall 2018.
Apartments at the Vice tower will start at 450 square-foot studios for $1,600 per month to three-bedroom, 1,400 square-foot units for $4,200. The building will offer common-space amenities, a jumbo-sized gym and high-tech features such as smart locks and thermostats. Flat-screen TVs and bookcases will be incorporated into some of the units, so tenants just need to bring a sofa, bed and dining table.
“Typically, as you progress through life and grow professionally you can afford better places to live,” said Ryan Shear, a principal at PMG’s Miami branch. “The building is targeted toward the younger demographic, because that’s the price point we’re trying to hit. But the term ‘micro-unit’ is often abused. 520 square feet in New York is not considered micro, but it is in Miami. We just see them as smaller apartments
Micro-units have already popped up around Miami as part of larger residential projects. The Flats Luxury Apartments in CityPlace Doral, for example, include a 518-square-foot studio for $1,645.
Tight Rental Market
Despite all the new construction in South Florida, demand continues to outpace supply in the apartment rental market. A 2017 first quarter study by Cushman & Wakefield claims 30,093 new apartment units were built in the past five years, while the region’s population ballooned by 333,000 — just one unit for every 11 new residents.
Although smaller apartments cost less to build, that doesn’t always translate to lower square-footage pricing. The costs of the most expensive rooms in any apartment — the bathroom and kitchen, which require plumbing, tile, cabinetry and electrical — remain the same, no matter the overall size of the unit.
According to Trulia, the median rental price for one-bedroom apartments in Miami in May was $1,500 — roughly the same price of the new micro-units. But the trend toward smaller apartment living is spreading. Tom C. Murphy, co-president of Coastal Construction Group of South Florida, says the average size of units in multifamily residential projects (i.e. apartment buildings) has gone down about 10 percent over the last five years, from 950 square feet to 900 square feet.
“We’re also seeing a trend in design for units to go even smaller,” Murphy said. “Developers now want to get two bedrooms into a 600- or 800-square-foot space. This is happening all over the country.”
What’s unique about Wynwood 25 is that the building is spearheading an attempt to bring full-time residents to the neighborhood.
“By Miami standards, these spaces are smaller than what you might find in suburban areas, which are geared toward multi-bedroom, large family products,” said Albert Garcia, vice chairman of Wynwood BID and managing principal for Wynwood Ventures. “These are designed for young adults who see Wynwood as the amenity for living in this area. Their living room space might be smaller, but they are steps away from cafés, galleries, retail, entertainment venues and museums.”
According to a study by the Harvard Joint Center for Housing Studies, 61.6 percent of renters in the Miami-Fort Lauderdale-West Palm Beach metro area were cost burdened (spending 30 percent of their income on housing), and 35.2 percent of renters were severely cost burdened (spending more than half their income on housing). South Florida ranked seventh out of 381 U.S. markets in the study.
Neighborhood As Amenity
The micro-unit trend started in large metropolitan areas such as New York and San Francisco four years ago, when a shortage of affordable housing led developers to try building smaller, more reasonably priced rentals.
Real estate analyst Jonathan Miller says the micro-unit concept hasn’t taken hold in New York City, because the rents aren’t that much cheaper on a square-foot basis than existing older buildings. But in a neighborhood like Wynwood, where residential is still a new form of construction and the target is a younger audience, the idea could sell.
“It’s very promising in terms of offering more affordability to an upstart market,” Miller said. “The premise is that in urban markets with a lot of restaurants and services, you don’t spend as much time at home, so smaller living spaces can be optimal. It will remain to be seen whether Wynwood will embrace this, but conceptually it makes a lot of sense.”
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Miami is a “city of the future” that needs to challenge “cities of the day” like New York and Boston to reach a new level, said developer Don Peebles, founder, chairman and CEO of the Peebles Corp.
Already a culturally developed, international tourist destination, Miami can achieve this by attracting new companies, allowing more construction and developing affordable housing for its workforce, Peebles told attendees at a Bisnow conference on transit oriented development Thursday at the Miami InterContinental.
“The region must get people out of their cars, improve mass transit and allow for denser development,” Peebles said. A strong draw for corporate investors is Florida’s low taxes who divides his time between homes in New York and Coral Gables. Why not go after the highly-taxed financial services industry in New York City, for example and bring them to this low-tax center?”
But there are impediments: traffic congestion and excessive complications for new vertical development and density. Miami employees typically spend as much as three hours a day going to and from work, which deals a major loss to productivity, he said. Miami’s workforce for the most part can’t afford to live where they work and lack access to the public transportation system.
The county has a rail system but it is not broadly developed. To access public transportation here today, people need to use cars. One answer is transit oriented development, which allows people to stay close to employment centers.
“People will need to access every part of their lives without getting into a car,” said Peebles, whose company is working on a variety of projects in Miami and the Northeast.
A major roadblock to developing new projects in the Miami area is a lack of unified zoning oversight, which limits density and structural height. Miami and Miami Beach are made up of many municipalities that each has its own city hall, police force and regulations for real estate.
“I never had to hire a lobbyist until I came here,” Peebles said. “Politicians here tend to reach out to small groups of people regarding real estate permitting. They can get elected with 4,000 votes. In New York City, the mayor has 10 million people, so what if 10,000 people get annoyed with him? In New York, people can express their views, but zoning is decided by people who are qualified. A central issue impeding development is there is no comprehensive oversight for real estate permitting, zoning, density and structural height. Miami has to realize that it is an urban center, and allow more supply.”
Peebles was one of several panelists that included Miami-Dade transport officials, real estate developers and attorneys. Others included Meg Daly, founder and president of Friends of the Underline (a park, path and trail built under the Metrorail), who said that bicyclists and pedestrians using the Underline have so far helped remove about 5 percent of cars from US-1 while attracting new customers to businesses along the route.
“Among other projects, Miami-Dade County is concentrating efforts to make first- and last-mile connections for all its rapid transit corridors,” said Aileen Bouclé, executive director of the Miami-Dade Transportation Planning Organization. “Uber and Lyft are helping, but they both are operating at a loss.”
“Meanwhile, as infill increases in the downtown area, the bare bones Metrorail stations should incorporate amenities, and new stations should be added between existing ones,” said Humberto Alonso, vice president of Atkins North America.
https://ven-americanre.com/wp-content/uploads/2017/05/One-River-Point_3-1.jpg6001600ADMINhttps://ven-americanre.com/wp-content/uploads/2023/06/Ven-American-Logo-blue-trans.pngADMIN2017-05-15 16:09:462021-03-26 11:04:24“There Are Great Opportunities For Miami, But Traffic And Zoning Issues Must Be Resolved,” Says Developer Peebles
Despite the condo market slowdown, developer Shahab Karmely is confident his project and the Miami River are poised for big growth.
Click photo to view video of Shahab Karmely discussing the Miami River and One River Point at the TRD Broward Showcase and Forum panel by TRD’s Alistair Gardiner
In a post-panel interview, Karmely and The Real Deal South Florida’s Managing Editor Ina Cordle discussed One River Point and the river at TRD‘s Third Annual Broward Real Estate Showcase & Forum in April.
Presales at One River Point are about to pass the 18 percent to 20 percent mark. Buyers there are mostly from South America, but also from Georgia, New York and Canada.
“We have headwinds – not us, just everybody else,” Karmely said. “On the other hand, we are financially very secure. We have no financing.”
The Real Deal previously reported that Karmely’s silent partner is Daniel Loeb, the billionaire investor who runs one of the most prominent activist hedge funds, Third Point LLC. Karmely’s KAR Properties has spent more than $112 million on acquisitions along the River, in Wynwood and in Hallandale Beach since 2013, and more on pre-develoment costs.
Karmely was part of a panel discussion on the economics of new development amid a new administration and continuing global market fluctuation.
https://ven-americanre.com/wp-content/uploads/2017/05/One-River-Point_3-2.jpg6001600ADMINhttps://ven-americanre.com/wp-content/uploads/2023/06/Ven-American-Logo-blue-trans.pngADMIN2017-05-08 20:31:202021-03-26 11:05:19A Developer Talks Miami River, Market Challenges, And His Project, One River Point
Every month, the Miami Association of Realtors announces the top 10 foreign countries that use its website to search for Miami real estate.
As you might expect, this list typically features the “usual suspects” month after month, such as Colombia, Canada, Brazil, Venezuela, Argentina and France. However, the most recently published report (from January 2017) included an unfamiliar newcomer: Turkey, ranked at No. 7.
Miami has always attracted foreign buyers, and we are very used to seeing strong interest from Latin America and Europe. But this marked the first time that a Middle Eastern country was included among that report’s top 10.
While time and circumstances could make this inclusion an outlier, it is also a fairly good demonstration of Miami’s rising profile among wealthy and sophisticated real-estate buyers from that part of the world.
Last September, CBRE Capital Markets reported that commercial investment in Miami from the Middle East totaled $517 million between January and June 2016 alone, making it the 10th most popular global market for Middle Eastern investment during this time period, and the fifth most popular in the U.S.
Why Miami?
A number of factors have coincided to propel this dramatic increase in demand for Miami real estate from the region. First, turmoil and unstable governments throughout the Middle East have pushed wealthy families to seek more and varied residency options, beyond the usual “comfort zones” of London and New York.
Second, Miami is considered a relatively new city, with many recently-constructed buildings and houses that offer state-of-the-art amenities, which appeal to prosperous Arabs.
Third, with the recent addition of world-renowned luxury hotels, restaurants, architecture, retail and cultural offerings (Four Seasons, Zuma, Zaha Hadid, Art Basel, etc.), Miami now enjoys a higher level of sophistication than in years past.
And finally, more direct flights from Dubai, Doha and Istanbul have literally put Miami within reach for more Middle Eastern buyers.
Put all these elements together, and Miami is now viewed as a secure, modern, upmarket, accessible and (important for Middle Easterners!) warm American city, with reasonably-priced real estate and amenities curated for high net-worth individuals.
(Recent buyers from Turkey present specific and compelling evidence of this observation. A few years ago, there was a big spike in their attention to projects like the Four Seasons in Surfside and the Capri in South Beach — just around the time that Erdoğan was elected president and began seriously consolidating power in that country.)
Three Broad Categories
Miami’s Middle Eastern buyers fall into three broad categories:
Wealthy individuals seeking pied-à-terres, to enjoy a few months of leisure
Investors looking to purchase at big projects like the W Downtown and the St. Regis Bal Harbour
Students attending college, usually at the University of Miami. Our country attracts many foreign students, and let’s face it — what 20 year-old wouldn’t love to spend four years here?
The really interesting phenomenon is that many of these Middle Eastern college students become the “gateway” for other family members, encouraging mom, dad, grandma and others to join them in Miami. Family is extremely important to Middle Eastern buyers, and real-estate professionals should be prepared to find housing for them that is suitable for and capable of expansion, or has more available units nearby.
No Trump Concerns
While President Donald Trump’s Middle Eastern travel/emigration policy (or “Muslim Ban,” as it has been described) draws international headlines and lots of cable news chatter, you might be surprised to know that clients from that region pay it little attention.
Prosperous Middle Eastern individuals do not feel unfairly “targeted” in any respect and feel no need to protest or complain. Their concerns are about finding safe, secure and reliable investments should they need to flee their home countries due to political, religious or military turmoil. This would be the case regardless of who occupies the White House.
While the region continues to be very unstable and capable of dramatic change, a mass influx of Middle Eastern buyers is not expected to Miami in the near or distant future. However, the trend of more wealthy individuals choosing Miami over major U.S. cities like New York or Los Angeles is here to stay, and Turkey and other Arab countries may become regulars on that list of online real-estate Web searchers.
