Jorge Perez: New Downtown Miami Condos Must Now Cost At Least $500 PSF To Be Profitable

Related Group chairman and CEO sat down for an interview with the Herald in May. The newspaper published that interview this week.

Here are a few of his thoughts:

Cost to build a downtown Miami condo – The minimum cost to build has risen with land prices and construction costs. “I could not build a high rise in downtown Miami with parking underneath today and sell it for less than $500 per square foot because I would lose money.”

Do foreign buyers price out locals? – Foreign buyers are actually helping to make the Miami market more accessible to middle class renters: “They are buying these units for investment purposes and putting them back into the rental market. So millennials and young professionals who can’t afford to pay a 20 percent down can live downtown at a relatively cheaper cost than buying. I would argue that foreign investors put some pressure on costs and kept the land prices up. But foreign investment in general has been great not just for developers, but for the entirety of Miami and making accessibility of rental units accessible to the middle class.”

Liberty Square: Related is devoting much time and thinking to redeveloping Liberty City, with the goal of transforming it. The original affordable housing built in Liberty Square was “beautiful,” but became a ghetto since it was only low income housing. The new project will include businesses, retail, shops, along with mixed-income housing, in order to make the neighborhood sustainable.

The full interview can be read here.