Developer Blowout at The Plaza on Brickell
June 5, 2010 by Lucas Lechuga
In this video segment, we discuss the developer blowout sale at The Plaza on Brickell that was announced Thursday afternoon. I received word just 24 hours later that 16 units had already been placed under contract. This is now the best deal in Brickell but availability won't last long. Later in the video, we also discuss the uptick in luxury condo sales in 2010. We end the show with a picture slideshow of Penthouse A at Apogee South Beach which came onto the market last month with an asking price of $16M.
I have an acquaintance who does research on the housing market in South Florida with Oppenheimer. He feels there will be a new spurt of pressured sales and walkaways from luxury properties by recent high end Europeans buyers, as the Euro has lost 40 percent of it’s value in a very short period of time causing a cash crunch for these buyers, effectively paying 40 percent more in taxes, monthly maintanance, and purchase price. He also states that many Europeans were able to get loans from banks with improper documentation. He cites Canadians (as one example) who are receiving large loans, with unsubstantiated earnings on loans to purchase in South Florida. The carry over from poor lending practices as of June 2010, 5 percent down on precontruction on new condos in Canada, are the same fools loaning on Florida condos.
Does it mean that we can get loans from Canadian banks?
Lucas,
re: Plaza at Brickell prices reduced –
It’s about time. I dealt with them before I bought my place at Infiinty, but they would not reduce their prices enough for it to buy there.
Also, they wanted me to buy the condo for more (like 10K -15K) then the purchase price and they would give me the money back at closing. I guess they wanted to keep up the apprisals or something for the building.
It was just too strange with a strange charges on the HUD statement. I did not want to buy a place like that. But that was 6 months ago, maybe things are less strange their now.
Question: You said that they are selling a 1 bed for 165K, please tell me what floor is that unit is on, and what is its sf and want does it view? Thanks
Lucas,
are you able to anwswer my question?
Question: You said that they (Plaza) are selling a 1 bed for 165K, please tell me what floor is that unit is on, and what is its sf and want does it view? Thanks
owneratinfinity,
That unit is located on the 3rd floor and has 739 square feet. As of this morning, only 7 units were still available.
iphoneapi While the Euro slide is significant it is nowhere near 40% versus the USD. The number is under but close to 20% looking at 09′ highs/closes. Also many of the European investors are receiving rental income in USD ,so , to a degree, a currency hedge against the lower Euro. Not everybody sublets but this exchange ratio may make that attractive to Europeans going forward who find dollar denominated HOA/taxes too burdensome. I also wonder how high a % of the luxury market the European’s represent in Greater Miami. Guessing its single digit.
Seanjohn – You are correct that the European that bought when the Euro was strong against the US $ and now either sells or rents in US $ will be better off then the pure US $ losers. But then again, I have always said that the currency exchange issue is separate from the purchase decision (you can always just play directly in the currency market without the falling price real estate risk). However, for someone who had already purchased (sunk cost) perhaps they can make it less worse now… Regardless, enthusiasm for real estate is not high…the summer months will certainly clear up any confusion…
If anyone is interested in the naked bike ride event, please read on. Here is nudity with a purpose.
Alex (MUL) has invited you to the event ‘Miami World Naked Bike Ride’ on MIAMIurbanlife.com!
Show your support! NUDITY is optional! lol
Time: June 12, 2010 from 4:30pm to 7:30pm
Location: Starts at Freedom Tower in Downtown
Organized By: Miss Susy & Miriam Cruz
Event Description:
This is Miami’s first…. World Naked Bike Ride. It is the labor of love of a few hardcore individuals who believe that Now is the time to stand up for the environment and the health of our planet by promoting independence from oil and car culture. All over the globe, from Auckland to London, from Montreal to Buenos Aires, from New York to Los Angeles; Cyclist will take to the streets in “Bare as you Dare” fashion to oppose the reckless reliance on petroleum products.
This ride is unique for us here in Miami because of our proximity and connection to the gulf oil spill via the gulf stream. It has been disheartening and saddening, to put it mildly, to see the devastation, and suffering due to possible incompetence in part of unregulated oil companies and the governments deficient regulatory institutions. Add to it the concern we feel over the use of dispersants that are not sufficiently understood, studied or tested and the effect that might have on marine life, the acquifer and food chain.. It easy to feel overwhelmed, confused and upset.
Miami World Naked Bike Ride provides a platform for the members of this community to channel all this in a genius, positive, creative, ridiculous and slightly subversive way, ala Henry Thoreau. There is value to exercising our right to peaceful protest. At the very least it will inspire others to do the same, at its very best it will draw us together as a community, show us that we have heart, and help create the bonds that will help heal us a little . Who knows we may have a chance to place our message out there via media letting government and big industry know that the people have a say and a voice. There is power in numbers and I certainly hope you join us and ride on that day. Lets have fun, be truthful and make a memory and a story worth telling.
Nudity is OPTIONAL, costumes and body painting is encouraged, laughter is welcome, lets put a smile on the faces of all those people lucky enough to encounter this curious flotilla of protesters.
See more details and RSVP on MIAMIurbanlife.com:
http://www.miamiurbanlife.com/events/event/show?id=1256554%3AEvent%3A679097&xgi=4ocOI3QP5ilCT4&xg_source=msg_invite_event
Renter Tom- Agree, currency trade is a seperate issue although I do feel that there is a flight to safety currency factor among some South American buyers in South Florida even during the frothy days of 04/05′. Re your comments for the whole market, my thoughts are that the R.E. market is plodding along, stuff is clearing, dips will be the norm, a return to steady annual value appreciations? Not a chance. However is there a slow uneven absorbtion of supply? Yes. Credit is still a problem. Most buyers are cash still but that also bodes well on the flip side for the security of the market in the future in Miami & will make the market less captive to the huge swings we have seen ina more leveraged enviorment. This pace may not be the ideal still for many underwater sellers but folks still want to be here just less for investor driven reasons, the summer is always a slower period , I still think that 2010 may be as close to a recovery as this market deserves or can achieve.
According to Condo Vultures:
“Miami Beach Property Values Tumble 12% In 2009
Property values for existing real estate product located in the barrier island city of Miami Beach tumbled nearly 12 percent, or $2.9 billion, on a year-over-year basis in 2009, according to a new report from CondoVultures.com.
Existing real estate product in the city of Miami Beach is now assessed at $21.9 billion, down from $24.8 billion in 2008, according to the report based on the latest projected values from the Miami-Dade County Property Appraiser.
The proposed values – which still need to be finalized and do not include new real estate product under construction – are used to assess property taxes that must be paid by April 2011. ”
– Miami Beach should have held up better than anything else really, so this is just indicative of what is going on in the market… Not an investors paradise for sure!
I read an article today that BP oil spill will reach Miami beaches in 20 days. A lot depends on the winds written in the story. This situation worries me a lot. If in fact it happens I think it will have devastating consequesces to Maimi economy and real estate values. Your opinions?
RT If you look at that % drop for MB , 2008 versus 2009 I think that IS an example of MB holding up better than anywhere else in related markets. Also, for the most part, current sales are driven by values tumbling over the last two years. The definition of what makes an investor paradise isn’t making 07 buyers positive on their mortgages. I also think South Beach has seen upticks in values & closings on the troubled West Ave corridor in 2010 over 2009.
Renter Tom,
What on earth does the assessed property value have to do with anything. The ACTUAL value of property was dropping faster than the assessed value which is why so many people were complaing. The assessed value is just now trying to catch up to all those losses.
From the very same article you posted:
“It is important to remember that these estimates are backward looking and do not necessarily reflect today’s real market values.”
“- Miami Beach should have held up better than anything else really, so this is just indicative of what is going on in the market… Not an investors paradise for sure!”
Median prices in Miami Beach have held steady. I don’t investors sit around and complain that prices are steady just because the assesed value of their property goes down. If anything this simply makes it a better investment because there are now less taxes to pay.
Lara Agree The slick is a potentially dangerous issue for MB. In general, to overseas buyers to whom Florida is Florida the fallout from the spill just on the Gulf Coast is enough to temper some buyers enthusiasm for starters. Overall this could be very bad for Miami & the whole state even if oil doesn’t hit the beach. Hoping I’m wrong but this is bad.
gixxer, agree the numbers are not current since they refer to assessed values. they just confirm significant decrease has occurred over the past couple of years. but our state and local governments are now facing severe budget shortfalls do to the lossees of this revenue stream-does not bode well for the future of many communities with respect to government services.
lara and seanjohn, i have posted the same question. if oil begins to wash onto our shorelines this year-and if this carries on intermittenly over several years, how will it affect oceanfront property values? the entire oceanfront state of florida wants to know this answer. and could it affect nonoceanfront property in brickell and downtown (my guess is it actually may help demand there)? remember people do enjoy the polluted waterfronts of NYC.
Gixxer 1000 said: “If anything this simply makes it a better investment because there are now less taxes to pay.”
— Um, really? Most So. Fla. municipalities that have cut assessed value are simply jacking up the tax rate to make up for the difference. People wouldn’t be so angry about property taxes if their tax bills were going DOWN. You seem to be good at crunching numbers, but a little deficient when it comes to making common-sense analysis thereof.
the euro is headed to 1-1 with the dollar so unless they pay cash, they could have some issues
the oil will be churning around florida for 5 years >>>
if the loop current takes to the east coast …. ???
euro went down and some buyers had issues ??/
when the dollar loses half its value in a few years how will that it effect
m b real estate market ??