Drake Puts Two Condos at Marquis Under Contract
September 26, 2010 by Lucas Lechuga
Inside sources recently revealed to me that 23-year old hip-hop/rap artist Drake has placed two side-by-side condos at Marquis under contract. My guess is that he will combine the two units to create a mega-condo. Marquis is a luxury condo building located at 1100 Biscayne Boulevard in Downtown Miami. Ever since prices were slashed this past summer, sales have picked considerably at Marquis. Prices start at $263 per square foot. A few months ago, an 8,042 square foot penthouse at Marquis sold for $4.2M.
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Sounds like Drake needs better investment advice.
“Sounds like Drake needs better investment advice.” JOE!!!
Actually, Drake’s condominium purchase at the Marquis seems like a great investment decision. Seeing Drake’s income is above 50 percent of the population his recent purchase is most likely an investment property which has unlimited incentives as far rental income not that he needs it, tax write offs, income loss for tax purposes etc… and besides, its better to spend then to owe money the government at the end of the fiscal year. Take it from me, i own a few income properties myself.
First, I doubt that a multimillionaire rapper’s main goal in buying a Miami condo is as an investment vehicle. As much as he comes here his hotel bills are probably close to what his mortgage will be. But regardless if he can afford to keep it for a while (which is probable) Marquis is in a great position to be a good investment. You’ve got City Square coming to the north to make the PAC even better. To the east you’ll have two brand new museums at museum park. This also means that Marquis will always have unobstructed views. And to the west you’ll have Miami World Center.
Welcome Neighbor! Lots of action here lately and looks like by year end aprox 100 units will have closed….seeing actual work done in the park is the best news from the perspective of this Marquis resident…Time will tell in terms of “investment” as anyone buying now is at least getting a substantial discount from peak pricing and DC seems hell bent on killing the USD (check gold at $1300 which is having a HUGE effect on our industry)……Also pretty sure Drake will enjoy his Februarys here in tropical Miami rather than chilly Toronto!
Gixxer 1000 — You might want to check into the historical financial performance of the average rapper’s portfolio before you suggest spending millions on a so-called “mega-condo” is a good idea absent investment considerations.
Second, the resale value on such “mega-condos” is generally poor. If Drake is so rich that money is no object and he decided a condo was a better investment than a single-family mansion (dubious), he’d be buying one of the many penthouse units still available. Instead, he’s buying two regular units at bottom prices and then combining them. Assuming he does a full tear-out, he’ll need another r.e. boom before he can even think about breaking even on the millions he’ll have “invested.”
As for Miami World Center … HA HA HA HA HA HA!! You really knock me out sometimes, Gixxer 1000.
Joe, he paid around $323 per square foot for a 2 story 3800 square foot pad…….probably at or below true construction cost…..Penthouse would be somewhere around $500-600 psf and smaller in size so he actually is making a more conservative purchase……..Perhaps there is a little more downside psf (250-275)? But really don’t envision seeing $100 psf in this building and it is not easy to exactly time tops or bottoms in markets….during the boom prices hit $800 psf he’s in at $323 so by definition he’s buying closer to the bottom than the top….
SwissLuxury.com — Who said anything about $100/sf? I sure didn’t.
Drake might have paid $323/sf, but assuming he does a full tear-out to combine the units — otherwise, why buy two? — he’ll easily be back at the $500/sf price range of a penthouse. Paying penthouse prices on a non-penthouse floor is dumb in a bull market, let alone the current r.e. quagmire.
It is mind boggling to hear that people are telling about the “Old Economy” these days! TRUE CONSTRUCTION COST? What is that? A Oxymoron? Are we still buying a $1000 cel phone? (For those who care to remember…….)
This is AMERICA! You buy 5 cent worth of cereal for $2.50. You buy a song for 99 cents. What is the cost of song? What is a cost of Picasso? IT IS WHAT IT IS WORTH – What people are willing to pay. (without Obama’s help).
I can show you many sales which do not show in any reported because they were realistically low. North Bay village 360 condo sold for $209,000 – 1701 sq ft. in april 2010. This is real and reported on Miamidade.gov. But for some reason it is not included in any comparisons.
Go figure! Get real people! if the market hits the bottom – it will start rising. But how long do you think this cheerleading is going to last? Till pregnancy?
Who said Drake was doing a total tear out??? One unit is for him and the other for his Entourage.Those Canadians are Smarter than you think!!!!
Paul,
That’s Joe just trying to add $175 psf to the $323 psf price that swissluxury quoted to make it seem overpriced. Why on earth would anyone do a FULL TEAR OUT of these units. Especially if it is the units that swissluxury is describing. Regardless of which even if you did it would be nowhere near this price.
If you wanted to combine these units you would either simply take out the wall between the two kitchen/living spaces to make one large space or simply put a door between the two units and turn one kitchen/living room into a “family room”. You’re talking about combining a 4 bedroom unit with a 1 bedroom unit. There is absolutely no reason to mess with any of the bedroom spaces. The larger 4 bedroom unit has only 1 living space so the other unit would simply work as an additional living space and an additional bedroom. When he wants to move all he has to do is replace the wall or removed the door.
The penthouse that sold in June went for about $525 psf. This was a very savvy move to get a similar space at a value of $323 psf. Given swissluxury’s numbers he will still be under $1.8m even after combining the units for much less than the penthouse that sold 3 months ago for $4.2m. Luckily Drake is not using Joe for his investment advice.
Joe,
I know people working on the Miami World Center project. The land has was purchased and there is a special district written into the new Miami 21 zoning code specifically for this site. This project will happen. The downturn and decrease in availability of financing has obviously changed the timeline of the project. But these 9 blocks have been assembled and will be redeveloped. It may not be exactly what has been portrayed and may change over time as most large scale developments do but it will be redeveloped. And give what is there now pretty much whatever they put there will be a plus for Marquis.
Gixxer 1000 — My God, is there no limit to your Miami r.e. shilling?
What would be the point of buying a 4-bedroom and a 1-bedroom and then simply adding a door between them? Doesn’t that seem like a lot of effort simply to add one bedroom? The 4-bedroom was too small but a 5-bedroom is perfect? Really?
When people buy adjoining condos like this, they generally tear out a substantial part of one or both units to create, as Lucas said above, a “mega-condo,” with a massive open living room, a home theater, a rec room, etc., etc. I know your little “Drake will only install a door” scenario suits your purposes from a cost/investment standpoint, but I’ll be shocked if that’s what this guy has in mind. *Shocked.*
Joe,
Look at the two units and you’ll see. The 4 bedroom only has 1 living space which is the kitchen/living room. So you are either in a bedroom or you are in this one living space.
The point isn’t to add a bedroom its to add a separate living space. The 4 bedroom unit already has a massive open space. So you put a doorway between the units and the second living room becomes a family room where you put a pool table, game room and most likely a stripper pole with this buyer.
If you want a home theater room you simply take the large bedroom on the main floor of the 4 bedroom unit along with space from the gallery and concert it. And you still have an extra den in the 1 bedroom unit.
So now you have a 4 bedroom unit with a massive two story open living space with views of the ocean, a second massive two story open living space with views of the ocean to use as a recreation room, a large theater room, and even a another den to do something else with. And all of this can easily be done within the current footprint of the two units.
I’d maybe also open up the wall between the den in the one unit and get rid of the laundry space in the 4 bedroom unit because you don’t need two laundry spaces to create another larger space and create a better flow through the two units.
There is absolutely zero reason to tear everything out. You are reading to much into the word “mega-condo” and simply hearing what you want to hear.
I have to have some sort of benefit to be a shill. Is there no end to your doom and gloom predictions??? You have no idea what Drake is going to do but yet your already claiming its a bad investment.
Poor and Unemployed,
Construction cost are based off of things like the price of steel, copper and labor. All of which have already be decreased slightly because of the reduction in demand and can’t go much lower. Most constructions companies doing work today are only getting 3% – 5% profit if that at all. At my last company we took on some projects at about 2% just to keep people working. If we make any mistake we would have easily lost money.
Gixxer,
I think the developers of Miami World Center are loosing some of the properties to the bank. Shame because it was a great project
Gixxer 1000
I do not know if you have seen earlier downturns in the industry. What is the price in percentage – of land, labor and PROFITS in relation to cost of steel and cement used. If I were a construction worker, I would love to get $40 /hr for hauling dirt. Hey, pretty faces got $50,000 /yr to sit at reception of dot com companies prior to 2001. Not to mention the first class flights and luxury hotels with the founders to meet the VCs.
It is a ECON 101. Supply and Demand. Their shape remains same. Real estate is a traditional high leveraged cyclical business. Longer term returns cannot exceed more than 0.5% – 0.75% over the inflation. Given the default on mortgages, investors would ideally need 10 – 15% interest to buy MBS. That is the reason government is making hugh purchases at high prices. There are no buyers for these securities except the government, who is printing the money.
Cyclical markets are subject to manipulations and that is what took place and is continuing. People were given advance to spend on future price of the homes because the private investors did not care to give deadbeats more credit cards. Most have forgotten that the bankruptcy laws were changed earlier this decade. Was that a coincident? Why there is no bail out for 401K of people retiring? How are they suppose to live for next 20 years with half of their life savings evaporated because of ……………??
Poor and Unemployed — You’re exactly right. The current mentality is to bail out deadbeats while not only ignoring but *punishing* producers and savers. It’s really breathtaking when you step back and take a wide-view look of where America stands right now.
Rapper Trina recently moved into a Penthouse at Marquis.