Monthly Archives: November 2006

Miami Intent on Reasserting its FTAA Secretariat Bid

County hopes to woo IDB conference

South Florida Business Journal – November 24, 2006

International trade advocates hope to host the 2008 Inter-American Development Bank conference in Miami-Dade County.

Leaders at the Jay Malina International Trade Consortium have asked the county commission to support the bid proposal. The IDB ­ a regional development bank that provides lending and technical support for economic and social projects in Latin America and the Caribbean ­ meets in a different country every year.

The United States has been selected as host country for 2008. The IDB conference was last held in the United States in 2000 in New Orleans. More than 6,000 visitors are expected for the 2008 event.

Cost of the conference is estimated from $10 million to $15 million and most of the funding is expected from the private sector. The county, along with Miami and Miami Beach, would be asked to provide police and transportation.

Texas cities Atlanta, Houston and Dallas are also tossing their hats into the ring.

All three have been angling to steal Miami¹s title as “Gateway to the Americas,” especially Atlanta and Houston, which submitted bids for the future headquarters of the Free Trade Area of the Americas (FTAA). Deliberations to create the trade bloc across the Western Hemisphere have deteriorated since the last major gathering of trade ministers. That meeting was Miami in 2003.

Source: http://phoenix.bizjournals.com/southflorida/stories/2006/11/20/daily41.html

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What’s Goin’ On

By Helen Hill

Leonardo Hidalgo’s painted car featured at the Hallucination exhibition co-hosted by ArTech and Jade Ocean

Mission: Real Estate

With Russians now figuring as an important target market for South Florida real estate, it was tempting to head this paragraph “the Russians are coming.” But Groundwork avoided the cliché and instead confirms that a delegation of Russians did indeed come to Miami recently in the form of 28 members of the Moscow-based Russian Guild of Realtors (RGR). The trade mission group headed south post-NARdi Gras — the National Association of Realtors Annual Conference and Expo — in New Orleans to see what the Miami area has to offer their clients. Welcomed by Teresa King Kinney, CEO Realtor Association of Greater Miami and the Beaches, Inc. (RAMB), the Russians were introduced to local real estate professionals and were able to establish new contacts and generate referrals. Their program included RAMB’s Miami River Real Estate Boat Tour, showing off the more than 30 residential and commercial new developments going up on or close to the river; seminars on investment opportunities in South Florida, and receptions and tours. Michael and Gil Dezer of Dezer Development and Elena Baronoff of Exclusively Baronoff Realty showed off the Miami lifestyle at a cocktail party they hosted at the Trump Towers sales center at 158th & Collins Avenue and at a private dinner in Trump Grande Ocean Resort & Residences’ penthouse sales center at 181st Street and Collins Avenue.

Marketing, Miami-style

Marketing condos in South Florida means offering more than mere shelter. Lately the focus has been on tempting sophisticated buyers with the promise of an inimitable lifestyle that’s glitzy, artful and healthy as well.

“Pearls of Wisdom & Jewels of Health” was the theme when jewelry queen Judith Ripka, a frequent Canyon Ranch guest and future resident of Canyon Ranch LivingMiami Beach, celebrated the nearly completed luxe development at 6901 Collins Ave. Ripka showed off gemstones and colored diamonds in limited edition pieces from her holiday collection, including “mouthwatering” ambrosia bracelets and truffle necklaces. Showing off bling works best on the fit and fashionable, according to Canyon Ranch exercise physiologist Dr. Michael J. Hewitt, who gave guests valuable advice.

“Diamond” encrusted cocktails! Sounds a perfect way to capture the upscale jewelry vibe for guests at the recent “Infinite Indulgences” event. Infinity II Lofts at Brickell hosted the evening with Chopard’s Bal Harbour boutique, at the Infinity II sales center at 1300 S. Miami Ave. Guests sampled the drink du jour and feasted their eyes on models draped in Chopard’s latest jewels.

Sales center as avant-garde art gallery! Is this the new direction for condo marketing in this art-conscious town? Even the cookies, frosted with the ArTech logo and rendering of the building, were part of the scene at Fortune International’s recent celebration for two of its new developments, Jade Ocean in Sunny Isles Beach and ArTech in Aventura, a joint venture with Shefaor Development, The cookies were small fry in comparison to Ecuadorian painter Leonardo Hidalgo’s Hallucination exhibit, a frenzy of ten massive paintings on display around the Jade Ocean’s $5 million sales center at 17121 Collins Ave. Other examples of the artist’s provocative work showed up in unexpected places — a boldly decorated mannequin in the model bathroom, a psychedelically painted car at the entrance and colorful Hidalgo-designed shirts on the servers’ backs. Edgardo Defortuna, president of Fortune International; Ana Cristina Defortuna, VP of sales; and Claudio Stivelman, co-principal of Shefaor Development, were all presented with Hidalgo-adorned hard hats.

Buzz

Art Basel Miami Beach arrives next week, bringing with it thousands of upscale visitors — and real estate marketing gets into high gear at the prospect of a wealth of potential home buyers in town. Some notable developer and condo-happy events include:

Internationally acclaimed, and often elusive, designer Philippe Starck makes a rare South Florida appearance at the Related Group’s booth at the official Art Basel Miami Beach in the Miami Beach Convention Center. The booth will showcase the Related Group’s projects, including Icon Brickell in downtown Miami inspired by the London-based design firm, YOO by Philippe Starck. (Starck was also the inspiration behind Icon Brickell’s sister project Icon South Beach, which opened during the 2003 Art Basel Miami Beach.) This year Basel fairgoers can view Starck’s signature whimsy in his design concept for Icon Brickell, including a spectacular entrance flanked by monoliths modeled after the Moai Statues of Easter Island. Also in typical Starck fashion are the larger than life fireplace and chess set in an outdoor living room, and an enormous chandelier suspended over a plunge pool in Icon Brickell’s 28,000-square-foot spa. Starck is scheduled to appear at the TRG booth for a meet and greet from 4:00 to 6:00 p.m. on Wednesday, Dec. 6.

Designer Todd Oldham will be hosting a Dec. 9 party at the Fairfax on 18th Street and Collins Avenue featuring an installation, Drunken Letters to Stray Balloons, by New York-based artist Daniel Joseph. The installation, sponsored by The Fairfax and the Wolfsonian-Florida International University, encompassing personal ephemera, paintings, drawing, sculpture and video, considers social rituals of celebration and partying as presented through the artist’s personal history. The event will also show off Oldham’s innovative designs for The Fairfax’s luxury boutique and proposed fractional ownership resort, his newest project on South Beach.

Mondrian South Beach, the first ownership offering from tony Morgans Hotel Group, will officially launch its sales center at West Avenue on Thursday, Dec. 7, marked by a preview event envisioned by the property’s designer, internationally acclaimed Marcel Wanders. Newly formed Corcoran Sunshine Marketing Group, a combination of New York real estate heavy hitters, is planning to reach some of the “connoisseurs of style from around the globe” who are in town for Art Basel. Prices for the condo and condo-hotel residences range from $400,000 for bayfront studios to $4 million each for four private penthouses.

Commercial real estate networking event

Next week’s RealShare SOUTH FLORIDA conference will be the first for South Florida. Organizers Real Estate Media, publishers of Real Estate Forum and GlobeSt.com, present some 24 such events annually around the country. According to Richard Kelley, director of RealShare Conference Series, they were attracted by South Florida’s dynamic real estate market with its depth of talent and interesting stories.

The half-day program covers the state of the market, office and multifamily/condo sectors, investment sales activity, and the debt and equity capital markets. High-level executives representing owners, developers and lenders as well as investors and brokers are expected to attend. The event takes place Wednesday, Dec. 6, from 7:30 a.m. to 11:45 a.m. at Hard Rock Hotel & Casino, 1 Seminole Way, Hollywood, Fla. Info and registration: Colleen McShane, 212- 255-3620 or cmcshane@remedianetwork.com.

Also Coming Up

Sunday, Dec. 3, 2 p.m. “Continuity of Change in Shanghai” — Speaker: Xing Tonghe, chief architect of Shanghai Xian Dai, one of the largest architectural firms in the world and the firm responsible for more than 70 percent of new development in Shanghai. Presented with the Miami Design Preservation League, Greater Miami Convention and Visitors Bureau and the Urban Arts Committee of Miami Beach. Lincoln Theatre, 555 Lincoln Road, Miami Beach. $10 for members and students; $20 all others.

Tuesday, Dec. 5, 6:30 p.m. – 8:30 p.m. Free Workshop on Condo Insurance.

Presented by the City of Miami Beach Neighborhood Services Department and Ad-Hoc Condo Reform Task Force Insurance Requirements for Condominiums. Guest speakers: William Raphan, Condo Ombudsman’s Office, state of Florida and Alina Torres, Department of Financial Services, state of Florida, will answer questions from the public. Miami Beach City Hall Commission Chambers, third floor, 1700 Convention Center Drive. Info: Miami Beach Answer Center, 305-604-2489 (CITY), ext. 2489.

Helen Hill is a freelance writer specializing in real estate and lifestyle topics.

Source: http://www.miamisunpost.com/groundwork.htm

 

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Stadium Plans will Propel Development

Stadium would boost real estate market, business leaders say

By Dan Dolan
Building a $420 million stadium for the Florida Marlins in downtown Miami might be the cure for the area’s softening real estate market, business leaders said this week.
And the good news for downtown business interests, Miami-Dade County leaders say, is that a proposal to put a stadium on 9 acres of government-owned land just north of the county administration building has the inside track with baseball executives and many elected officials.
“This would do wonders for property values in the downtown area,” said John Blazejack, president of Blazejack & Company, a Miami real estate consulting firm. “But any plan has to work to the public’s benefit, too.”
A plan unveiled last week by County Manager George Burgess calls for taxpayers to contribute the site — which real estate experts estimate is worth $17.6 million — and float loans to pay for construction. Mr. Burgess said loans would be paid off through a combination of tourist taxes, a special state tax subsidy, revenues generated by other redevelopment and $162 million in rent from the Marlins.
“The county would own the stadium and the land,” Mr. Burgess said. “But we’re still working on the details of the entire project.”
Commissioner Jose “Pepe” Diaz said there is a long way to go before a stadium becomes reality. While he prefers a proposed site in his home district of Hialeah, he said, a downtown venue may make it easier to close a projected $120 million gap in the cost of construction and revenues to pay for a stadium.
“There may be more tax money available to pay for a stadium downtown,” Mr. Diaz said. “I know Major League Baseball is determined to have the stadium downtown.”
That’s music to Miami real estate leader Edie Laquer’s ears. “A downtown stadium would be one of the best things that could happen to us,” she said.

Source: http://www.miamitodaynews.com/news/061130/story1.shtml

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The Sarnoff Factor

Development
For activist, election victory just a skirmish in density fight

November 29, 2006 By: Oscar Pedro Musibay

he election of activist and attorney Marc Sarnoff to the Miami City Commission is likely to cause trouble for the high-density development that made Mayor Manny Diaz a national celebrity.

Observers say the newly elected commissioner will be a vigorous advocate for smaller projects in low-density, low-rise residential neighborhoods throughout the city. Most agree the Diaz lobby still holds a majority vote on the commission, which means Sarnoff will experience a tough time changing the city’s direction on development.

But Sarnoff did win by capitalizing on his opposition to a Home Depot in Coconut Grove, drawing on growing discontent with fast-paced development and its effect on the quality of life.

Residents of the Grove and the Brickell Avenue corridor turned out for the Nov. 21 runoff in higher numbers than voters in other parts of the district, helping Sarnoff beat out appointed Commissioner Linda Haskins — whom Diaz strongly backed — by a nearly 2-1 margin.

Support in the Grove and other vocal opposition by some neighborhood associations to high-rise projects in neighborhoods like The Roads and Morningside are broadcasting a negative message about the mayor’s and commission’s infill development policies.

That could spell trouble for Related Group’s Mercy Hospital redevelopment, which has triggered some neighborhood opposition, when Sarnoff votes for the first time Dec. 14.

He insists he’s not anti-development, saying “development is good” as long as there is concurrent planning for roads, water, schools and other infrastructure.

Sarnoff has said high rises should not be allowed north of 36th Street because Metrorail and other municipal resources aren’t there. He also said buildings of five stories and up should not be allowed next to single-family homes.

“Look at Coral Way. Right behind Coral Way are [single-family] neighborhoods, and yet there are 36-story buildings being built on Coral Way,” Sarnoff said. “That person that lives two, three, four houses away, and even 10, 15, 20 houses away, no longer has sunshine. I think that’s wrong.”

He said approval of the 15-story Kubik condo project on Biscayne Boulevard between Northeast 55th and 58th street was a “horrible mistake.”

The proposal sparked a lawsuit by residents trying to stop construction of the project in a neighborhood of single-family homes and low-rise commercial. The city responded by passing a height limit in the area.

“I’m pro-smart development,” Sarnoff said. “I think we should continue to develop Miami, and we should do it in a smart way. We need to keep the high rises away from the residential areas and not put pressure upon those residential areas. We need to make sure that we create and occupy green space and we don’t seem to be doing that. High-rise development belongs downtown.”

Patricia Baloyra, head of Broad and Cassel’s real estate practice, said she doesn’t see Sarnoff’s victory scaring off developers and investors.

“I don’t think he was running on a platform of ‘no growth,’ so I don’t think that his victory will dampen interest from investors and developers — for now,” she said.

Sarnoff supports the city’s proposed zoning-in-progress legislation, which would act as a de facto building moratorium during development of Miami 21, a citywide zoning reassessment, according to Baloyra and other real estate attorneys. His support could cause investors to be more cautious.

“Any building moratorium is bound to cause investors and developers to be more circumspect, at least in the short term,” she said. “There is also a scarcity of affordable and work force housing, and a moratorium would of course delay any progress on that important and time-sensitive issue.”

Zoning-in-progress rules are being reviewed by the city and commissioners.

Irela Bague, chairwoman of the advisory Miami River Commission, which is the first stop for developers pursuing projects and rezoning on the river, said Sarnoff could have a big impact on development along the waterway.

The river commission has supported scaling down development density from the mouth toward the more industrial areas upriver.

But city commissioners and the mayor have backed high-rise redevelopment in poorer neighborhoods like East Little Havana and pushed for higher densities near single-family homes and the conversion of marine zoning to mixed-use residential on the river.

They also have stacked the Miami River Commission with like-minded appointees.

The river commission, left with a shrinking pool of marine-zoned properties, modified its infill plan last year to prohibit changes to marine zoning.

“Our infill plan was amended last year to preserve all marine uses,” Bague said. “Anything that goes for a zoning change, from marine to anything else the marine industry is going to fight it. I don’t know if he is going to support that or not.”

Commissioner Tomas Regalado has been on the losing end of several votes approving redevelopment including the Freedom Tower condo and Home Depot projects.

Regalado said he doesn’t know what to expect from Sarnoff but doesn’t expect his new colleague to be as pro-development as the “happy duo,” his reference to Diaz and former City Commissioner Johnny Winton.

Winton was suspended from office following an altercation with police at Miami International Airport last May, and Diaz named former city chief financial officer Haskins to replace him until voters chose a replacement.

“We have the Mercy Hospital project, which is a huge project and which will be a test. In January, we have the streetcar. He is not running out of tests,” Regalado said. “It’s only the vote that counts — not the words but the vote.”

Another signal will be whether Sarnoff votes his mind or defers to commissioners on projects in their districts, an unwritten code in Miami politics.

“On his campaign Web site, in response to the question ‘Can you vote against a commissioner on another district issue?’ Marc Sarnoff answered, ‘Definitely.’ So the resulting intracommission dynamics could prove interesting, considering the general consensus regarding deference to the commissioner of the district,” attorney Baloyra said.

Little Havana activist Yvonne Bayona said Sarnoff may be more sensitive to the residents’ concerns about overdevelopment. But she doesn’t expect him to have a big impact on commission decisions because Commissioners Angel Gonzalez, Joe Sanchez and Michelle Spence-Jones routinely align with Diaz on development, she said.

“The majority is going to rule,” she said. “As far as the commission is concerned, there are more pro-development commissioners.”

Source: http://www.dailybusinessreview.com/news.html?news_id=41182

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North Bay Village Implements Novel Retail Boosting Ordinance

Businesses Wanted
New Ordinance Encourages Ground-Level Retail Along Kennedy Causeway


North Bay Village has big plans for Kennedy Causeway. File photo by Mitchell Zachs/MagicalPhotos.com.

“I remember when there was a bowling alley here.”

By Angie Hargot

Last week the North Bay Village City Commission passed an ordinance prohibiting residential developments on Kennedy Causeway that do not include commercial uses.

The item passed quickly during the Nov. 8 meeting with relatively little deliberation from elected officials or citizens.

“What we’re saying with this ordinance is you can’t build an all-residential building on the causeway anymore,” Mayor Joe Geller said. The plan is to allow only mixed-use buildings in the commercial (CG) district, thus encouraging additional commercial and entertainment businesses to move into North Bay Village. The ordinance is also designed to drive more pedestrian traffic to those businesses, and Geller says the ordinance is intended to keep “entirely residential buildings from taking up space in [the city’s] limited commercial district.”

The meeting was the first for newly elected at-large City Commissioner Reinaldo Trujillo. Trujillo took the spot vacated by now-former Commissioner Tzvi Bogomilsky, who chose not to run for re-election. Trujillo ran unopposed.

Bogomilsky bid a fond farewell to the citizens and the commission, and looked on as staff replaced his name placard with Trujillo’s.

One of Trujillo’s first orders of business was the causeway item. “My understanding is we want commercial business [in the city],” Trujillo said.

Although the change would hardly return development-attractive North Bay Village to the unique quaint character of its past, Commissioner Paul Vogel reminisced about a time when the city had different kinds of businesses within its borders. “I remember when there was a bowling alley here,” he said.

Introduced by newly reappointed Vice Mayor George A. Kane, the Kennedy Causeway item made its way to the commission after approval by the Planning & Zoning Board at a meeting on Aug. 15.

“The way our code is at the moment, we wouldn’t be able to [for example] tear down the Crab House” and replace it with a mixed-use building, Kane explained. The new ordinance also allows businesses located in mixed-use residential buildings to direct their signs toward the street. Previously only stand-alone businesses were allowed to have signs.

“The Lexi development, with two floors of commercial [businesses], is exactly the kind of building we’re looking for,” Geller said. The Lexi is scheduled to open in 2007 together with a handful of publicly accessible shops, including a Starbucks. (Lexi developer Scott Greenwald and his associates were also present at the Nov. 8 meeting.)

Other causeway-related moves conducted at the meeting were heralded by the administration as a response to calls to beautify the thoroughfare that came out of the city’s charrette in June. Although voters did not pass a $2 million bond item slated for landscaping and aesthetic improvements to the causeway in September, other measures are being taken to actualize the results of the charrette – or what the commission sees as citizens’ desire to have the causeway improved.

At the same commission meeting, an item was passed authorizing the expenditure of $68,350 to Iler Planning Group, who hosted the city’s charrette, to devise a “causeway plan, design guidelines and code amendments.”

The allocation of $35,000 was also approved to go to LaRue Planning and Management Services to revise the city’s comprehensive plan as state law requires, following the city’s recently approved Evaluation and Appraisal Report. The state gave the city 18 months to move forward on the comprehensive plan, setting the deadline for plan changes in late 2007. Geller says some incremental changes, such as design guidelines, have already been adopted.

“That doesn’t mean I’m going to approve any high-rise,” he said. “We don’t want it to turn the city into ‘condo-canyon.’”

Source: http://www.miamisunpost.com/fifthststoryfrontpage.htm

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Housing Slump Has Broad Ramifications According to Chairman Bernake

Fed chief sees housing as a risk

By Patrice Hill
THE WASHINGTON TIMES
November 29, 2006

 

Federal Reserve Chairman Ben S. Bernanke said yesterday that a deepening housing slump is the biggest risk looming over the economy, a warning driven home by an industry announcement of the biggest drop in the nation’s median home price on record.
That median price drop of 3.5 percent was recorded by the National Association of Realtors and was led by a 5 percent drop in the Northeast. Futures markets are predicting further drops totaling more than 8 percent on average in the Washington area, Miami, Chicago, Los Angeles and other major cities by the middle of next year.
“The correction in the housing market could turn out to be more severe and widespread than seems most likely at present,” Mr. Bernanke said in a speech to the National Italian American Foundation in New York.
A downturn in prices was “inevitable” after the extraordinary run-up between 2000 and 2005 that raised prices nationally by 60 percent and doubled or tripled home values in Washington and other hot markets on the East and West coasts, he said.
House prices went so high in many areas that they became unaffordable for average buyers, he said, and that “sowed the seeds of the correction” now under way by limiting demand for homes and forcing the need for price cuts and incentives to bring purchasers back into the market.
He suggested the rise in interest rates engineered by the Fed since 2004 was a less important factor precipitating the housing downturn.
While the deceleration in home prices and the housing-led slowdown in the economy so far this year has been welcome among central bankers intent on cooling the fires of inflation, Mr. Bernanke said, further deterioration could threaten the already low 1.6 percent pace of economic growth by undermining consumer confidence and spending, which had gotten a big boost during the housing boom.
“A deeper correction would directly affect economic activity through additional cutbacks in housing starts and through its effects on employment in construction and housing-related industries. More indirectly, it might also impose greater restraint on consumer spending by reducing homeowners’ equity and thus household wealth, and perhaps by affecting consumer confidence.
“Because consumption makes up more than two-thirds of aggregate expenditure, any significant effect on consumer spending arising from further weakness in housing would have important implications for the economy,” he said, although “to date there is little evidence that the weakness in housing markets is spilling over more broadly to consumer spending or aggregate employment.”
Mr. Bernanke took heart that home sales appear to be stabilizing, with the Realtors reporting a slight increase of 0.5 percent in existing-home sales last month, the first in eight months. Big price cuts and incentives also brought about increases in new-home sales during August and September.
But the number of homes on the market for sale keeps rising, and at today’s slow sales pace, will take a long time for the market to absorb, Mr. Bernanke noted. The inventory overhang also will force developers to cut building plans by even more than the 35 percent slash in construction starts they already have ordered this year, and thus will continue to weigh on growth well into next year, he said.
Dramatic cuts in auto production also have been depressing growth, the Fed chairman said, but “outside of the housing and motor vehicle sectors, economic activity has, on balance, been expanding at a solid pace.”
Mr. Bernanke said the Fed continues to be “uncomfortable” with the underlying rate of inflation running at 2.4 percent to 2.7 percent — well above the Fed’s unofficial target range of 1 percent to 2 percent. He blamed higher costs for energy and other raw materials, which are being passed on by businesses, as well as a jump in housing inflation to 4 percent from 2.25 percent last year.
The government’s measure of housing inflation reflects the cost of renting single-family homes rather than the direct costs of owning homes, such as mortgage payments, insurance and taxes — a feature that some economists criticize.
The design of the index has created a statistical enigma: Measured housing inflation has been going up even though home prices are dropping, while it was flat during the years home prices were soaring.
The reported rise in housing inflation “may reflect in part a shift in demand toward rental housing as families judged homeownership to have become less financially attractive of late,” Mr. Bernanke said, but his remarks suggested the Fed is unsure about the reliability of the housing measure.

http://washingtontimes.com/business/20061128-093710-8201r.htm

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Condominium Hotels are a Tricky Business

 

Condo Hotels

By AMY GUNDERSON

Published: November 29, 2006

Imagine a vacation home complete with 500-thread-count linens on plush mattresses, daily maid service, and a 30-treatment spa. Hotels have rolled out condos at an increasing clip over the last several years, tempting buyers with amenities, hassle-free ownership and the potential for regular rental income, all rolled into one sleek package with a concierge desk.

Like the rest of the housing market, however, condo hotels are not immune to the slowdown, and several projects, after splashy sales releases, have quietly curtailed building plans because of sluggish sales and rising construction costs.

The Hard Rock Hotel’s plans for 1,200 condos in Las Vegas ended in February, with developers returning buyers’ 10 percent deposits, while Las Ramblas, a condo hotel development that counted George Clooney as a backer, scrapped its blueprints for more than 4,000 condos and hotel rooms off the Vegas Strip. A handful of condo hotels in the works in Orlando and Clearwater, Fla., have also lost momentum before ground was ever broken.

But even with setbacks like these, hotels continue to build condos on a more modest scale, and convert existing rooms for ownership.

“Offsetting those cancellations is the expansion of the concept into a lot of small marketplaces which aren’t necessarily large resort areas,” said Patrick Ford, president of Lodging Econometrics, a Portsmouth, N.H., hotel industry research firm. “It is spreading away from the major markets and into the secondary and tertiary resorts.”

Of the 168 condo hotel projects in the works, according to Lodging Econometrics, 81 are under construction and 46 are scheduled to start construction over the next 12 months. And the number of projects actually opening for business is on the increase: In the first three-quarters of 2006, a total of 14 condo hotels opened their doors, while in the fourth quarter of this year alone, 15 will open.

Although many new projects are in places like Orlando, Las Vegas, Miami Beach and Fort Lauderdale, an increasing number are popping up in less likely places. There are of course the condo hotels like Nicky Hilton’s Nicky O South Beach on Miami’s Ocean Drive, opening next year, and the Westin St. Maarten Dawn Beach Resort & Spa, opening in December and selling its 99 condos for $895,000 to $2 million. But expect to see more developments in golfing destinations like Arizona and other mountain enclaves. Condo hotels are even popping up near universities and in obscure gaming towns, like West Wendover, Nev.

Regardless of a condo’s location, potential buyers need to look closely at the development, beyond those grand spas, swim-up bars and concierge services.

Look at Comparable Condos

The longer the list of amenities at a hotel, the higher the asking price for units. Jones Lange LaSalle Hotels, a firm that brokers hotel sales, estimates that condo hotel units in areas like Miami, Las Vegas and the California beachfront are nearly twice the price of comparable stand-alone condominiums.

Get Ready to Research

Hotels selling real estate are legally limited in what they can share with potential buyers about hotel rates, expected occupancy and just how much an owner should expect to make from a rental pool. In fact, unless the developer files documentation with the Securities and Exchange Commission — a task that most consider costly and time consuming — he or she cannot reveal anything about the economic workings of the hotel to a potential buyer.

Before buying a one-bedroom condo in the Fontainebleau in Miami Beach last year, Kimberly Hartke looked at other hotels and condo hotels in Miami that were already open for business, and asked for their nightly rates in order to estimate how the Fontainebleau might stack up. She was swayed by the Jerusalem stone tile and soaring ceilings that highlighted the Fontainebleau’s interior, but she was equally impressed with its proximity to the convention center and its siting on the Intracoastal Waterway — an asset during big events like the annual boat show. “With these annual events, I thought the hotel was likely to sell out,” she said, noting that her condo now rents for anywhere from $300 to $800 a night depending on the season.

Understand the Management

Some condo hotels are made up entirely of condos, while others have a dedicated hotel with a separate area for condos. Regardless of the structure, buyers will want to know how the hotel integrates with the condominiums. Before a purchase, it is important to understand everything — from the number of days a buyer may use the unit (some have usage restrictions), to how far in advance he or she might have to book the unit, to how the hotel will maintain common areas like hallways and lobby.

Jim Butler, a lawyer with Jeffer, Mangels, Butler & Marmaro, a Los Angeles firm that represents hotels in structuring condo hotel contracts, also recommends that buyers reserve 4 to 5 percent of their revenues each year for incidental expenses.

 

Don’t Expect to Make a Profit

The prospect of rental income, and the fact that owners do not have to worry about finding a property manager, is no doubt attractive, but turning a profit may very well be an unattainable goal, according to Dante Alexander, chief executive of the National Condo Owners Association. “Most should not expect to make a profit even with full participation in the rental program,” Mr. Alexander said. “The average condo hotel will generate $7,500 a year but cost you $12,000 a year.” While a unit might rent out for $500 a night, remember that the hotel takes a large slice of that (typically at least 50 percent) and owners still need to pay real estate taxes, homeowner association dues and the mortgage.

Source:

http://www.nytimes.com/2006/11/29/realestate/greathomes/29GH-home.html?_r=1&adxnnl=1&adxnnlx=1164814937-3+XAewPqsYxZPbKAO282rA&oref=slogin

 

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Lima Approved on Nov. 15th by 5-0 Vote

Lima Land
43-Story Wynwood Project Gets OK From City Board


Rendering of The Lima Project. Photo provided by the architectural firm of Kobi Karp and Associates

“[It is unique because] it is the entire block.”

By Bonnie Schindler

In a city where skylines seem to change on a daily basis, another project has been given the green light to move forward in Miami.

The Miami Planning Advisory Board unanimously approved modifications to a previously approved major use special permit for The Lima Project during its regularly scheduled meeting Nov. 15.

The Lima Project, a residential tower and retail area to be constructed between NE 29th Street and 30th Street in the Wynwood/Edgewood area, will consist of a 490-foot, 43-story-tall, mixed-used structure, said Adrienne Pardo, an attorney representing 2937 Ferrari, LLC and 2915 Biscayne LLC, both of which are owned by Yves Barrough and Nancy Karp. The Lima Project is being designed by architect Kobi Karp, husband of Nancy Karp.

With a price tag of about $60 million, and expected annual tax revenues of $562,000 for the city of Miami, the building will be comprised of about 206 multifamily residential units, 3,202 square feet of retail space, and 402 parking spaces.

“[It is unique because] it is the entire block,” Pardo said.

By the entire block, Pardo means that The Lima Project will include the TechnoMarine building that is currently on the site. Built in 1965, this structure was not on the original permit granted in January of this year; however, it is now included in The Lima Project because of a business partnership involving the Starbucks currently sitting on the Biscayne Boulevard side of the TechnoMarine.

In addition, the residential tower’s footprints were shifted more than 10 feet, two stories were added to its height and the retail square footage has been altered, according to the project’s documents. These conditions forced the applicants to refile for the permit, Pardo said.

The city’s Planning Department concluded that the “property development will benefit the area by creating additional residences in the district.” But city planners added conditions, including that no curb or driveway be cut on Biscayne, but rather that all traffic be routed to either NE 30th Street or NE Fourth Avenue. City planners would rather have storefronts along the boulevard, not driveways, according to a Planning Department analysis.

Pardo and her associates tried to sway the board to dismiss this condition, as they felt an ingress is needed to allow cars coming from Biscayne Boulevard to easily turn into the parking area. But both Planning Advisory Board member Robert Young and Chairperson Arva Moore Parks requested that the applicant heed the city’s condition.

“I don’t want to harm the project [but I have to agree with staff],” Young said.

The board passed The Lima Project item 5-0.

Two other projects were deferred to later dates: Columbus Centre, a 56-story mixed-use structure to be located at 21 SW 15th Road, 1450 and 1490-92 S. Miami Ave. and composed of about 219 residential units, 234 hotel rooms, more than 200,000 square feet of office space, about 6,500 square feet of retail and restaurant space, and 596 parking spaces; and 2222 Biscayne, a 29-story building composed of nearly 400,000 square feet of office space, about 6,500 square feet of retail and bank space, approximately 6,700 square feet of restaurant space and 1,784 parking spaces.

The 2222 Biscayne project, to be developed at 2220 Biscayne Boulevard by Scott Silver’s Grouper UTD, LLC, will be heard Dec 6.


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Controversial Venezuelan Elections Will Affect Miami

Venezuela election boycott widens

Preparations for Sunday’s election are under way. A fourth Venezuelan opposition party has withdrawn from this Sunday’s congressional election amid a dispute over electronic voting machines.
Primero Justicia’s decision means more than half the opposition groupings have now pulled out.

Opposition parties are worried the election board could rig the vote. Electoral officials deny such accusations and say voting for the expanded 167-seat Congress will go ahead as planned. The government of President Hugo Chavez has vowed to increase its majority to two-thirds, which would allow it to pass constitutional reforms that opposition leaders strongly oppose.

SUNDAY’S VOTE
Venezuelans will vote for an expanded 167-seat Congress
Two seats were added since the last election
Supporters of President Hugo Chavez hold 52% of the seats and hope to increase its majority to two-thirds
120,000 soldiers will watch voting stations
The poll will be overseen by the Organization of American States and the European Union

Three other opposition parties pulled out of the poll earlier this week, accusing the electoral body of favouring pro-government candidates.

They are the main opposition party Democratic Action, Project Venezuela and the Social Christian party. President Chavez hit back, claiming the opposition was trying to derail the election and accusing them of plotting with the US to destabilise the country. President Chavez’s backers have called a rally on Thursday in support of the congressional election. Washington has said it is increasingly concerned about the state of Venezuela’s democracy, but denies helping the opposition parties.

‘Unreliable’

Democratic Action leader Henry Ramos has called for a suspension of the election until equal conditions existed for parties.

He told reporters earlier this week that there were software “irregularities” in the electronic voting machines.

Mr Ramos also cited lack of access to official voting lists and “deep” mistrust of the National Election Council (CNE), most of whose members are in the ruling party. Mr Chavez’s backers have called a rally in support of the poll Representatives of the electoral council have repeatedly denied accusations of a pro-government bias.

source: http://news.bbc.co.uk/2/hi/americas/4487686.stm

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Collapsed Projects Are Transitioning

Building boom deals collapse in Miami-Dade

Amid a historic building boom, a slew of proposed projects are up for sale.

BY MATTHEW HAGGMAN
mhaggman@MiamiHerald.com

The two-acre parking lot next to the Bank of America Tower in downtown Miami rode the building boom to the top.

In 2003, it sold for $8.8 million to local investors. By spring the next year, a development group backed by Latin American buyers agreed to pay nearly $24 million. And just months later, they agreed to flip the land for $46.5 million.

The plans were grand, and better still, they were approved: A sleek 746-foot office, hotel and condo tower called Lynx designed by architects Chad Oppenheim in Miami and the two sons of world-renowned I.M. Pei in New York.

Today, there is no construction on the site. The deals have collapsed, the buyers are locked in a court fight, and the original owners have the property back up for sale — spiffy building plans and all.

Across South Florida a historic building wave is remaking cities and shorelines, but it has also produced a slew of proposed projects — some very ambitious in scope — that are now on the sales block.

In some cases, the slowing market killed the projects. In other cases, it was the rising cost of construction, the spike in insurance, novice developers or all of the above. Whatever the reasons, the fervor to build spurred developers to spend millions on land, lawyers, architects and government approvals, only to decide against building.

”There is a lot out there for sale,” said Adam Greenberg, president of BayBridge Real Estate in Miami. “But a lot don’t make sense because they come with designs that are very expensive to build or with condo sales contracts that are below market.”

There are plenty of vacant lots sporting both big plans and big for sale signs:

The soaring 70-story Brickell Flatiron, comprising condos and offices, designed by increasingly acclaimed Mexican architect Enrique Norten. The tower is slated to rise on a triangular parcel just west of Brickell Avenue.

Ellipse, a 266-unit condo fronting Biscayne Boulevard a few blocks north of the Carnival Center for the Performing Arts.

A mid-rise condo tower called Elektra on North Miami Avenue across from the Shops at Midtown Miami.

Onyx 2, a slender high-rise condo on Biscayne Bay in Miami’s Edgewater neighborhood, and Premiere Towers, a condo project comprising two oval condo buildings, next to the restaurant and shopping complex, Mary Brickell Village.

Commercial real estate agent Edie Laquer said sales contracts have been signed for these two projects but have yet to close; she refused to disclose price or purchaser.

NOT ALWAYS A FAILURE

Some of these vacant lots are the forlorn reminders of high-profile flameouts, from a proposed Edgewater condo called ICE to 1390 Brickell Bay, a condo slated for a block off Brickell Avenue. But the fact that a project is for sale doesn’t always mean a business failure, Laquer said — especially if it is indeed sold.

”In some cases clients are making as much money selling as they would have if they developed a site,” said Laquer, who is selling a host of property and projects in Miami’s downtown and Biscayne Boulevard corridor. “Others have chosen to make a smaller profit and have a very comfortable flip.”

Laquer claims that 65 percent of Miami properties she’s selling with approved building plans are in contract, and everything else is in “advanced negotiations.”

One reason for the interest in lots with plans is that, for the right buyer, they present an unusual opportunity to snap up prime property already entitled for building.

The approvals can shave months to more than a year from the time between buying and building. Instead of navigating a lengthy process with city planners and political leaders, a buyer with approved plans can line up financing and quickly dig a shovel into the ground.

However, the problem is that many of the projects approved in the recent boom were for condos. And some builders — and bankers — want the record spate of condo construction to be digested before putting up more.

There are 22,254 condo units under construction in Miami, according to the city’s planning department. That’s compared to 15,525 total units that went up since 1995.

CONDO CRAZY

Meanwhile, 29,558 condos have been approved by city commissioners for construction, and developers have proposed another 30,674 units that city planners are reviewing. These number say nothing of the building in other towns across Miami-Dade and Broward counties.

Some would-be buyers are considering converting already-approved residential projects to other uses, observers say — a reversal of the boom-time trend of building condos on lots previously set aside for offices.

”Some are going back to commercial, office and retail,” said Rosendo Caveiro, senior director at Cushman & Wakefield in Miami. “There is also tremendous demand for residential rental housing.”

Of course, some sellers with lots up for sale are just staying put. For the moment, land prices are holding steady, observers say. That is prompting some owners with staying power to just hold on and let the market to shake out if the right offer doesn’t come along.

Caveiro said the betting is that well-designed and well-located projects will keep interest.

”We think construction costs will come down and expect insurance to get under control,” Greenberg said. “So we are telling a lot of our clients to sit tight.”

http://www.miami.com/mld/miamiherald/business/16111150.htm

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