MIAMI—There are plenty of new multifamily projects coming online in Miami. So what stage are we in and what are some of the common characteristics of the new multifamily complexes coming to market?
We caught up with Robert Given, who leads CBRE's South Florida Multi-Housing Group, to get answers to these and other questions in part one of this exclusive interview. Given's group completed over 43 sale transactions totaling in excess of $1.2 billion—that's over 10,000 units—in volume in 2013. Significant achievements of 2013 include the closing of The Resort at Pembroke Pines for $225 million and Doral West Apartments, a 388-unit garden style community, for $93,500,000.
GlobeSt.com: How is the multifamily market faring in South Florida?
Given: The fundamentals are very strong across all three counties in South Florida. Tourism remains at record levels, we're starting to see job creation again, and the region is experiencing significant organic population growth.
That, combined with pent-up demand for product—there were essentially no new deliveries between 2005 and 2011—creating a very strong market. We're seeing 7% to 8% rent growth year over year on higher quality assets. Essentially, we are a market seeking equilibrium, and it's not in sight yet.
GlobeSt.com: What stage of the development cycle are we currently in?
Given: Development is in full throttle right now, and we anticipate around 6,000 to 7,000 new units delivered each year over the next two to three years. We track 21 submarkets in South Florida, and of those, there are probably three or four submarkets that are going to experience heavy concentrations of deliveries in 2015 which could result in short-term concessions. But, we have not peaked yet and we may not peak for several years.
GlobeSt.com: What are some common characteristics of the new product coming to market in this cycle?
Given: We're seeing a lot more mid-rise, higher-density properties being delivered this cycle in burgeoning “suburban-urban” centers like Downtown Doral, Pembroke Gardens, and Downtown Dadeland. The quality of the finishes are much higher than during the previous cycle and include things like solid surface floor coverings, granite or quartz countertops and kitchen islands.
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