Momentum in South Florida Markets Driving Top-Dollar Apartment Sales

Miami apartment communities are fetching top dollar as the South Florida multifamily markets remain attractive from both a fundamentals and performance standpoint.

One example is the sale of 275 FontaineParc, a 133-unit property developed and owned by Marlon Gomez of Gomez Development Group and Emir Dereli of the Dereli Family Office, which traded for $50 million, or $379,939 per door, a record for the area according to sellers. 

Harbor Group International was the buyer for this mid-rise complex in western Miami Dade on Fontainebleau Boulevard. The property was completed in early 2020.

Expect to see such deals drive transaction volumes for years, JLL Capital Markets’ executive managing director Matthew Lawton tells GlobeSt.com.

“The in migration, job growth and corporate relocations into South Florida will continue to fuel rent growth and need for additional housing,” Lawton said. “Institutional and private capital recognize all the demand drivers in South Florida which will drive outsized returns compared to elsewhere across the country.”

Neil Schimmel, CEO, Investors Management Group, tells GlobeSt.com that‘South Florida is a dynamic story to investors and to an upwardly mobile tenant demographic. “Over the last 10 years, each of our South Florida assets has outperformed original projections. Population and job growth fundamentals aren’t showing any signs of a slow-down, which speaks to why assets are still trading for a premium.”

Sale Indicates Continued ‘Flight to Quality’

Eli Randel, chief strategy officer at CREXi, said that capital, in a flight to quality and safety, continues to compete aggressively for multifamily in the southeast given growing demographics, safe and value-additive yield, and shelters from inflation. 

“While on the surface the price may appear frothy, the glut of capital competing for finite opportunities is preserving value and constrained and growing markets like south Florida are likely to continue to see value appreciation, Randel said.

Gomez Development Group indicated in a release that the significant cap rate compression trending to sub 3% that has occurred over the past year “made sense that this was the right time to successfully exit this investment.”

Holland Knight with Westwood Realty Associates and FM Capital facilitated the deal for the seller.