Strong infrastructure gives Homestead growth springboard
Written by Laura Stace on January 8, 2014
Homestead’s real estate market is poised for growth due to existing infrastructure and a lack of land for single-family development in Miami-Dade County, industry experts report.
“There’s an abundance of high-quality infrastructure that came after [Homestead emerged] and has filled in over the last decade just to the north… Once these projects are built out, Homestead’s existing infrastructure will benefit,” said Peter Mekras, senior vice president of Continental Real Estate Companies.
Major developments along the east side of the Florida Turnpike in Homestead were brought forth just before the real estate market crashed and had become stagnant, he said.
“Following the crash, there were a few developments that continued in Homestead, but new markets were born just 100 blocks further to the north,” he said.
“Those new housing markets are robust today with new housing starts and favorable sales velocity.”
What will transpire, Mr. Mekras said, is that all existing infrastructure in place in Homestead south of 312th Street will soon become very valuable.
“It’s going to allow the homebuilders to deliver product on land and infrastructure that already exists. They are going to be able to mobilize product very quickly,” he said.
About 20 years ago, Homestead was almost entirely comprised of agriculture businesses as well as military, Mr. Mekras said.
As land pricing accelerated and the southern parts of Kendall filled in, east Homestead became a key corridor for growth and a large number of homes were delivered, Mr. Mekras explained.
The growth of residential allowed for a greater population to exist and retail to follow, he said.
Today, Mr. Mekras said, Homestead is primarily comprised of residential and neighborhood retail with little office space. He described the area as a place where people can find high-quality residential options and have easy access to major employment centers to the north and to the south (the Florida Keys).
Mr. Mekras said today the Dadeland market has become an urban center and new high-intensity residential projects are coming to the submarket.
He said several new multifamily projects will be developed in the Dadeland market with well over 1,000 rental apartments delivered in the submarket targeting young professionals and families.
Last year, Miami Today reported Dadeland Mall completed a 102,000-square-foot expansion taking the mall to a total of 1.4 million square feet. The mall is at 7535 N Kendall Drive.
Meanwhile, Elliot Shainberg, senior director of Franklin Street Real Estate Services, said there are a lot more retail spaces along US 1 and Krome Avenue because of the number of additional residents in Homestead.
Mr. Shainberg said there is more retail in the area now than a couple of years ago.
He explained that most of the multifamily communities with 100 apartments or more are affordable housing units.
Mr. Shainberg said he is noticing an increase in occupancy of these properties due to demand. However, he said, occupancy rates remain weaker than some of Miami’s major urban areas.
Rents in Homestead, Mr. Shainberg said, are substantially lower for the same type and size of unit in areas in Miami.
He said people are willing to commute to their jobs closer to the heart of Miami-Dade County if it means saving money on their rent. Also, he added, a lot of the apartments were built in the 1990s, which means renters are getting a unit that is relatively newer than those in other parts of the county.
Mr. Shainberg said comparing Homestead to dense areas of Miami including Brickell Avenue, Miami Beach and Coral Gables, Homestead has plenty of land. However, he said, relative to what it used to be like in Homestead, not a lot of land remains.
Mr. Shainberg said Homestead’s investors remain predominantly national and are in for the long haul.