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.

 

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Anonymous
2 years ago

Why did the Herald wait three months to publish this

Anonymous
2 years ago

He was stuck in the mountains of Italy with spotty cell coverage.

Anonymous
2 years ago

Oh yeah lol

Anonymous
2 years ago

It’s so nice of the foriegn buyers, with their livable wages, to park their money here and allow local yokels to be able to rent low quality Related projects. JFC this guys shite isn’t worth 350 a square.

Anonymous
2 years ago

“I could not build a high rise in downtown Miami with parking”

Then lobby for lower parking minimums.

anon
2 years ago

already exists.

Anonymous
2 years ago

No question that foreign money and money laundering drives up the cost of land, building costs, etc…

Thank God for the Melo Group focusing on middle-class local community.

Anonymous
2 years ago

Exactly and that is why Vancouver is so expansive also.

Anonymous
2 years ago

many cities in the US are dealing with this issue.

anon
2 years ago

No where near the scale of what has been built would have happened based on just local demand. The good news is the supply of rentals, and the creation of new communities, leading to a lot of urban renewal. Imagine how much worse the traffic would be without the migration to the core that has occured.

Anonymous
2 years ago

according to mr perez, miami millenials owe foreign real estate investors a favor, they are able to rent and live in downtown at an affordable price. if this investors and developers had not jacked up land prices the way they have miami millenials would have been able to buy condos and live at downtown at an affordable price.

Anonymous
2 years ago

People under 30 years old are not owed a downtown condo.
If they can afford it, and want to buy it, go ahead.

Anonymous
2 years ago

no youre wrong …its not always about jelous lazy complaining self entitled millenials. get of your high-horse mr. righteous, its about economic fundamentals. service jobs demanded in districts only the higher class earners can afford, pushing out the workers and reducing price if living.

Anonymous
2 years ago

Economics.
How is that post “wrong”. People under 30 years old are not owed a downtown condo.
If they can afford it, and want to buy it, go ahead.
Nobody is “pushing out the workers”.
For instance, The SLS Lux was a single house and a gas station. Maybe 3 workers were displaced to open a 59 Story residence and hotel that employees over 50 workers on a full time basis, nearly all of which pay more than gas station attendent.
Economic fundamentals?
With better education in economics, the young people making these unsound arguments could afford Brickell, and stop whining.
In fact, many millenials that DO produce, DO live there, and DO understand economics enough to demand a large wage.

2 Many Geezers
2 years ago

It’s also old people living too damn long. If I were a dr. I would be encouraging patients over 60 to start signing DNR.

Anonymous
2 years ago

Okay.. don’t live past 60 alright? Just put a gun to your head and blow your damn brains out on the 364th day past your 60th birthday. That is, if you get to live that long.

Anonymous
2 years ago

“The original affordable housing built in Liberty Square was “beautiful,” but became a ghetto since it was only low income housing.”

So Jorge, you’re also a historian now?

Please stick to trying convince the citizens of Miami that they need to see more Arquitectonica designed crap in their skyline.

Anonymous
2 years ago

Funny, the renderings of Liberty Square look better than a lot of market rate Related/Arquitectonica pulled out of their ass within the past several years. Mixed-income is the way to go to get more people attracted to the affordable areas they otherwise would ignore and complain about prices in places out of their league.

Anonymous
2 years ago

Jorge Perez, while not a historian, has a very long history of experience in the affordable housing business from a public and private perspective.

Anonymous
2 years ago

What do you guys consider as “middle class” in Miami?

Anonymous
2 years ago

Each earner in household earning at least 50-100k

Anonymous
2 years ago

What if the person has 1 million cash in the bank returning 4.5%, a $3m house and a Cadillac fully paid off, and 3 originally Picassos?
They have less than $50k income per year, still middle class?

Anonymous
2 years ago

I do not get into class warfare.

Anonymous
2 years ago

Luxury condos with private elevators, pools, gyms, top notch amenities.are not supposed to be entry residential units.

Want a starter home, try 2nd Avenue in Brickell, the Roads, Edgewater or any older bldg stock.

Anonymous
2 years ago

Typical self-serving piece on Perez. How kind of foreigners to park their money here so locals can pay their mortgage. Perez misses the entire point.

Anonymous
2 years ago

The newest gen of Related buildings have a budget feel when you look a bit past the flashy exteriors.

Anonymous
2 years ago

Certainly not the SLS Lux. Very well built throughout. I love the solid core doors and especially the fit and finish that keeps one room soundtight from the others.

Anonymous
2 years ago

“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.”

Funny, no matter how you built them, didn’t you lose hundreds of millions of dollars when the housing market went bust in the last cycle?