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The Condos Cometh

Condo developers have been markedly quieter these days, holding off on any new launches as the supply of preconstruction condos slowly gets absorbed in South Florida. Gil Dezer of Dezer Development, for example, hasn’t made moves on his next luxury condo tower in Sunny Isles, which he previously planned to launch earlier this year. He completed Porsche Design Tower last year, where a number of buyers are now looking to flip their units.

Behind closed doors, developers and agents are negotiating pricing on a case-by-case basis, insiders tell TRD.

And across the region, sellers are finally adjusting their prices, leading to more transactions.

Reports from Douglas Elliman and Integra Realty Resources confirmed that in some areas, the pace of residential sales picked up during the second quarter of this year. Fort Lauderdale fared particularly well, with the number of condo sales increasing 10 percent year over year to 608, according to Elliman. Even Miami Beach reported an uptick in sales activity — but a decline in pricing came with it; the median price decreased nearly 5 percent to $365,000.

The city of Miami is a different story: Condo sales fell by more than 13 percent to just under 2,000 in the second quarter, Elliman reported.

In some areas, like Brickell and the barrier islands, the industry is bracing for a flood of new construction to hit the market as projects get completed. Together, Bal Harbour, Surfside and Bay Harbor Islands are already facing more than three years of luxury condo inventory, and that excludes preconstruction units, according to a recent report from Condo Vultures Realty. Since the beginning of the cycle in 2011, developers have completed 15 projects and 832 units in the area, and another eight projects with 300 units are under construction. Sunny Isles, where projects like Jade Signature and Muse Residences are nearly complete, has more than two years of supply, Condo Vultures found.

And while developers aren’t announcing new plans, they are picking up sites for the next cycle. In Brickell, TSG Group paid $32 million in August for a property that can be developed into 500 residential units. A month earlier, Key International and Integra Investments bought a waterfront condo site in Boca Raton for $17 million.

In South Florida, nearly 48,000 condos have been proposed, planned, delivered or are under construction since the start of this cycle. Following is a list of the condo projects in the South Florida pipeline.

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