Realtime multifamily insights and opportunities from one of the most active Land & Multifamily brokers in South Florida (+$3.3 billion closed & counting ! )
Miami Multifamily Update
We've sold +$200M worth of deals so far this year in South Florida. What am I seeing on the ground? Miami Multifamily & Land Sales volume is down 50-70%, depending who you ask. Pricing from the peak in early-2022 is down roughly 20%. Where will we start seeing land & multifamily opportunities over the coming months? Answer: The only two types of groups that are real sellers today. Why? Merchant Builders | Newly built, recently stabilized multifamily assets today are trading at replacement cost; i.e. what it would cost to build those assets today. The merchant builders delivering those deals now are still willing to sell because their basis from 2020 still allows them to make some money on the sale in 2023. These brand new multifamily deals selling at replacement cost are my favorite opportunities in South Florida right now. We have 3 new multifamily opportunities like this coming up. Would-be Developers | A lot of the groups that bought land recently and still haven't closed their construction loan are finding themselves in a pickle. The land has carry costs that are burning a hole in their pocket and they now realize that the construction loan that they projected to be at ~80% LTC may now be closer to ~65% LTC. Now they either need to raise more equity, which is extremely hard today, or find "gap financing" at 12-15% that makes their deal even less feasible. The result? Many land owners are looking to either sell their land or Co-GP (co-develop) their site with stronger sponsors who have the track record or equity to still build the deal in this environment. CHART OF THE WEEK2/3rds of primary mortgages have an interest rate below 4%. Those homeowners are not willing to sell their homes, and give up the interest rates they've locked in. With less homes for sale and mortgage rates so high, more and more people will continue to rent. Bullish Multifamily & Single Family Rentals. That's all for now! Happy hunting, |
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Miami Multifamily Memo
Realtime multifamily insights and opportunities from one of the most active Land & Multifamily brokers in South Florida (+$3.3 billion closed & counting ! )
Omar Morales Our team is working on roughly ~$375,000,000 dollars-worth of active listings so far in the first quarter of the year. Most of the opportunities are condo / multifamily development land listings and some are existing multifamily properties. Below are just a few. Feel free to reach out for more. The next newsletter will include a market update and some commentary from me. Multifamily Listings Opportunity To Acquire A 108-unit Value-Add, Garden-style Property in Deerfield Beach...
Miami Multifamily Memo Why you should not buy Multifamily in Miami right now Why you should not buy Multifamily in Miami right now: Cap rates are ~5% Debt is +6%. expense inflation Insurance has been a problem Supply wave in certain pockets Why you should: There are few buyers today. Most groups are net bearish, waiting for “a reckoning” Multifamily properties that traded for ~$400K/unit in 2022 are now trading for ~$300K/unit. The cost to build those assets have gone from ~$250K/unit to...
Miami Multifamily Memo Current trends and opportunities 2023 is behind us. How did pricing and transaction volume compare to years prior? Where will it go from here? Let's dig in. **if you’d like this data broken out by Miami Dade, Broward, & Palm Beach County, please reach out via email for the excel** Most headlines will point out that transaction volume is down roughly 60%, year-over-year. However, as predicted in my 2023 mid-year update, South Florida is back to a pre-pandemic average...