Investor Confidence Increases in Miami Real Estate

In recent weeks there have been two high profile transactions in the Miami real estate community. In my opinion, these two sales represent both a positive psychological shift as well as boost of investor confidence in the Miami real estate market.

The Sonesta Beach Hotel on Key Biscayne, which was the first major resort hotel to be constructed on Miami’s prestigious Key Biscayne community in 1969, was sold to Argentine investors. According to local sources, Consultatio S.A., a publicly traded company based in Buenos Aires, Argentina, purchased one of the largest remaining develop-able oceanfront sites on Key Biscayne, which consists of the 40-year Sonesta hotel and 10 acres of land, for $78 million.

The Argentine developer was attracted by the opportunity to redevelop the site located at 350 Ocean Drive. In 2005, a local group including Edgardo Defortuna, purchased the Sonesta Key Biscayne property and then closed it down a year later. A couple of years later they secured the necessary approval from the city to build a 165 unit condominium as well as the permit to demolish the hotel. Unfortunately, due to the major cooling off in the housing market the project never got off the ground.

In 2008, the Key Biscayne market experienced several sales of luxury oceanfront condominiums as high as $1,500 per square foot in the Ritz Carlton, Grand Bay or Ocean Tower projects. Clearly, Consultatio S.A. was quick to recognize the opportunity to redevelop this site over the next few years and take advantage of the price of oceanfront real estate that this prestigious island off of downtown Miami commands.

In other news this week, the historic 105-room Raleigh Hotel in South Beach traded to local hotel investment company Brilla Group and AJ Capital Partners, for approximately $30 million. The all cash deal closed this week and has yet to be recorded in the Miami Dade County records.

The seller of the Raleigh Hotel, Andre Balazs and his investment group, acquired the art deco masterpiece designed by Murray Dixon, for $25.2 million in 2002. With occupancy rates and the average daily room rates suffering in the area, the fact that this property traded at $285,000 per room is a huge boost of confidence in the Miami hotel and Miami Beach market. According to local sources, the original asking price of the hotel was $40 million and it had been on the market for over a year.

Are you looking for a Miami or Miami Beach property at a deep discount? Are you looking for a discounted short sale or bank owned property? Ross Milroy of Miami Angel Properties, LLC may be reached at 305-673-5300 or info@miamiangelproperties.com.

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The Miami Lifestyle

This weekend I spent several hours biking on Collins Avenue and A1A with a few of my local cyclist friends. While we are dealing with major oversupply in the real estate market and continued news of major layoffs, we are truly blessed to live in this diverse and beautiful city. Let’s face it, for many living in Miami is a ”lifestyle” choice. While the rest of the country is enduring freezing temperatures or major snow storms, here we are living it up on the beach and swimming in the warm clear azure waters of the Atlantic Ocean.

Miami is growing up. Our downtown area may appear to be a concrete jungle, but if you look closely, it has the makings of one of the most striking urban centers in the world. When is the last time you looked at downtown from across the Biscayne Bay at night? This past weekend the annual Miami Marathon kicked off from the American Airlines Arena. The 26.2 mile race covers one of the most unique courses of all major marathons. In the early morning hours runners pass through and experience the Port of Miami, South Beach, Ocean Drive, Miami Beach Golf Club, the Venetian Isles, Brickell Avenue, Coconut Grove and Key Biscayne. We are constantly spoiled and exposed to major cultural, art, drama and professional sporting events in our city, lest not we forget our incredible architecture, organic farmers markets and a constant flow of international visitors.

This city never ceases to surprise me. Browsing  through the December edition of Ocean Drive Magazine, I read about several new culinary superstars and recent restaurant openings. In the new Fontainebleau Miami Beach, we have Gotham Steak, Scarpetta, Hakkasan and La Cote. In the new W Hotel Miami Beach, which is scheduled to open this Spring, Mr. Chow and Serafina will make their debut. In Miami Beach, we continue to welcome new restaurants such as Gaia Ristorante on Ocean Drive, the famous Parisian restaurant Au Pied De Cochon,  Sean Brasel’s Meat Market on Lincoln Road, Red Steakhouse, Fogo de Chao, and Philippe Chow’s “Philippe” in the Gansevoort South.

We may not have a large employer base, Silicon Valley, nor the most reliable workforce, but we do have something that keeps people wanting to move and live here. It’s a love hate thing. I am confident, however, that for most of us it is a lot more love than hate. This is a special city and we are fortunate to enjoy it in all of her glory.