Soft Market Leads Miami Developer To Convert 47 Million Rental Project Back To Condo
Written by Susan Stabley on January 2, 2003
By Susan Stabley
A Miami developer who switched his Brickell View mixed-use project from condominium to rental is returning it to condo.
"We’re now a 180-degree (turn) back where we started," said Willy Bermello of BAP Development, a subsidiary of architectural firm Bermello Ajamil and Partners, designer of the partially built structure.
Mr. Bermello said an "economic response to the market" is prompting the double turnaround for the 37-story, $47 million tower at 1200 Coral Way and South Miami Avenue west of Brickell.
"With interest rates as low as they are, there is a flood of new homeowners that have entered the market." Mr. Bermello said.
Within 30 days, the 323 units – from one to three bedrooms – should be selling as condos, he said. Brickell View’s foundation was poured in April.
"We’re selling at a price point well under the waterfront-type condos," he said, "from $275 to $300 a square foot."
Construction has reached the 15th floor and Mr. Bermello said Monday crews are about 16 months from completion. The project includes 18,000 square feet of retail with possible tenants being a restaurant and a CVS pharmacy.
Mr. Bermello said the tower’s name would probably be changed from "Brickell View."
"We’ll leave that to the experts," he said.
BAP development is able to watch Miami’s residential market firsthand through its own Summit Brickell – another mixed-use project offering rental apartments. Summit is in the same neighborhood on South Miami Avenue between 10th and 11th streets.
"The rental market is still soft," Mr. Bermello said. "That’s part of reason why we’re going into condo conversion on Brickell View."
With part of Summit Brickell completed in August and residents moving in since September, more than half of its 405 units are rented.
Still, BAP’s decision to return Brickell View to condo follows a noticeable trend in Miami-Dade County as hundreds of rental units are being converted, including Manhattan Towers, a Miami Beach apartment building that will be reborn as AquaSol.
Grec Conversions, with partner Agustin Herran of the Sedano’s Supermarket family, are also about to sell out a 396-unit conversion project in Hialeah called The Los SueÒos. The group finished or is in the process of converting three other apartment complexes in Bay Harbor Islands, Miami Lakes and North Miami totaling 630 units.
And one of the largest conversions recently completed in Miami-Dade was The Waverly at South Beach, a 36-story, 399-unit luxury waterfront apartment tower.
Because of a drastic hike in insurance premiums and other expenses, it’s hard to make a profit from rental apartment buildings, said MaryJane Stone, a consultant at Integra Realty Resources AREEA/South Florida, a real estate valuation and consulting firm. Unable to raise rents enough to cover their operating costs, many property owners are selling, she said, and developers and investors seem willing to buy.