October 21, 2014

Development

Condo Combo

Apogee Beach
Related ISG is planning two new condo projects, Apogee Beach in Hollywood Beach (rendering above) and My Brickell in Miami.

Two titans of the south Florida condo boom have teamed up to launch sales for two new condo projects — one in Hollywood Beach and one in downtown Miami's Brickell area. Developer Related Group and marketing/sales giant ISG are targeting international buyers, capitalizing on one of ISG's specialties, and say they could launch as many as four additional projects during the next two years.

Related Group CEO Jorge Perez, who built more than 15,000 condo units during the boom years, is uncharacteristically reticent about these new projects. "We don't see a huge market at this time," he says. "We want to test the waters of how, in particular, the foreign market that is driving Miami today — which is mostly Latin American and European — will react to some new product at basically very attractive prices."

The new units, he says, are priced the same as distressed condos in the region. Buyers will be expected to pay the majority of the purchase price during construction, a South American-style model that ISG principals Philip J. Spiegelman and Craig Studnicky have worked with. The model lets Related ISG, as the joint venture is known, skip hard-to-find bank financing, and Perez says the group has the cash to complete the projects even if there aren't enough buyers. "A downturn would not cause us to have to pay back loans," he says. If the bottom falls out of the market, Related ISG can sit on the units and wait for prices to go back up.

That's something Perez wasn't able to do with several of his boom-time developments that got caught in the bust. He turned some projects over to lenders, sold units in others at deep discounts and put more than $1 billion of his own money into Related to keep it afloat.

"We're starting small," he says. "And if the market gives us the signal that it's ready to take more, we'll go forward."

Apogee Beach
Apogee Beach rendering

Tags: Miami-Dade, Housing/Construction

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