All's Well That Ends Well

Yesterday it was reported that US Home Sales rose 3.4% over comparable sales for the past year in October. This is seen by many as a sign that the worst of the housing slump may be over. Of course you still have the doomsayers predicting further sales and price declines but the numbers definitely bode well for a return to normalcy in 2007.

The end of 2006 is not going to be mourned by many (if any) in the real estate industry as it has been a year of tumultuous markets and constant decline. Moreover, because of the hangover from the boom of the last several years sellers have been unwilling to reduce their prices, creating a stalemate between buyers who want to get a good deal and sellers who want to get what they think their property is worth. This should change in 2007 as the glut of homes on the market forces sellers to reduce prices or get out of the market. All in all 2006 was painful, but sometimes that is what is necessary to get back on track...at least lets hope! Happy New Year!!!

Introducing AllPreconstruction.com

As 2007 begins, Blue Coast Preconstruction will finalize a transition in its name to All Preconstruction. This change reflects our committment to finding information on all of the preconstruction projects that are currently available. This is information going to feed our new Version 1.0 All Preconstruction Database that will allow our members to search and sort more projects than ever before. There are so many developments to choose from that it is important we get as much information as possible on as many new developments as possible so that our customers and their clients can make the most informed and effective decision.

In addition to changing the main domain to AllPreconstruction.com, the change will also help to organize the All Network of sites because each city will follow the same naming convention, for example, Miami Preconstruction was MiamiFloridaPreconstruction.com but it is now AllMiamiPreconstruction.com, Las Vegas Preconstruction was LasVegas-Preconstruction.com but it is now AllLasVegasPreconstruction.com, and so on and so forth...

Also our supplementary sites have been updated as well. Our new Blogger page is now at http://allpreconstruction.blogspot.com/ instead of http://bluecoastpreconstruction.blogspot.com/. Also our MySpace page is now at mypsace.com/allpreconstruction instead of the old myspace.com/bluecoastpreconstruction.

We hope that you like the new name and continue to be patient as we finalize the Version 1.0 All Preconstruction Database. All of the best preconstruction projects will be available here soon!!!

Florida Will Be World's #1 Tourist Spot

Originally Posted on Tuesday, December 12, 2006

Tourism is expected to grow at record levels and push Florida to the top tourist destination in the world by 2025. This comes from a report by the committe that was charged with drafting the state's long-term aviation plan. The report concludes that within 20 years the number of people visiting Florida will double to 80 Million, moreover, 2/3 of those visitors will arrive by air. This is going to create a burden on the state's airports and if something is not done to increase capacity this incredible growth could be stunted. But thats the bad news. The good news is obvious: More residents and thus increased property values!

Florida has long been a place where people come to visit and then say, you know I could really see myself living here. With more tourists come greater numbers of new residents. Ofcourse this comes as no surprise to me or any other Floridian for that matter. We didn't decide to live here becuase we have to, because it's the only place where we can do business...we decided to live here becuase there is no better place to do business than in paradise. And there are very few businesses in paradise that do as well as real estate...maybe bars? So this story brought a big smile to my face as it should to anyone who has or is going to have property in Florida.

So lets get on top of expanding these airports becuase the Florida Sunshine isn't going away and people are sick of freezing their butts off!!!

200 Acres in Punta Gorda, Florida will see Mixed-Use Project

Originally Posted on Monday, December 11, 2006

GlobeSt.com reports that the Wilder Cos. has acquire 200 acres in Punta Gorda, Florida where it plans to build a project called the Loop. The Loop will consist of 1.2 Million sf. of retail, 500 residential units and 100,000 sf. of office space as well as a 200 room hotel. The Loop is an expansion of the same New Urbanism concept that the company has had in other areas of the country. If you visit the main website www.attheloop.com you will see links to each of the projects that have carried the Loop name. The first one, in Methuen, Massachusetts north of Boston, is already fully operational and seems to be doing very well. You can visit the website by clicking here.

There is another Loop in Orlando that has been successful as well, and the Wilder Cos. hope that this success will continue in Southwest Florida. This is the big gamble though as many feel that the demographics must shift within the next few years to provide the kind of growth that will fill a development of this size. The Punta Gorda market is underserved contend the Wilder Cos. brass, particularly in terms of upscale shopping options. They say most people living here are going to Fort Myers or Sarasota to shop and this in turn is helping a migration out of the city that this new development could reverse.

Below is a picture of the general location of the project on Jones Loop Road...

Preconstruction Blog Now Available On Website

Originally Posted on Monday, December 11, 2006

Yesterday marked an important day for the Preconstruction Blog. After months of only being available on the Blogger.com site the Preconstruction Blog is now also available on the main BlueCoastPreconstruction.com website.

You can get there by visiting the main site or by typing BlueCoastPreconstruction.com/preconstruction_blog.htm.

This is an important transition for the Preconstruction Blog and was made as a result of the incredible response that the Preconstruction Blog has received. In addition to being made available on the main site, the Preconstruction Blog will now receive daily updates as opposed to weekly. We hope that you continue to enjoy the blog wherever you decide to view it!

3 Condos Propsed for Mercy Hospital Site in Coconut Grove

Originally Posted on Wednesday, December 06, 2006

The Miami Herald reports that Boca Raton based Ocean Land Investments is partnering with Jorge Perez's Related Group to propose a 3 tower 300 unit Ultra-Luxury condo development in land behind Mercy Hospital in Coconut Grove. The land is owned by Mercy Hospital but the hospital wants to sell 6.7 acres of its prime bayfront land to the group for $98 Million. The hospital says that it will use the proceeds from the sale to fund much needed internal improvements to the hospital.

The project, which was originally going to have 1000 units, has faced public opposition from residents who fear an increase in traffic in an already congested part of Miami. The reduction to 300 units and decision to brand the project as an ultra-luxury project was due in part to appease these concerns. Related contends that the affluent residents of such a project would not be contributing to the rush hour problems becuase most of them do not need to be at work during the normal 9 am to 5 pm work day. The ultimate decision as to whether or not the project will proceed will be up to the Miami City Commission.

Click Image to See Larger View:

28 Unit South of 5th Receives Financing

Originally Posted on Monday, November 27, 2006

A Miami developer has secured $90 Million in financing to cover the entire costs of construction for South of 5th, a new 28 unit condo to be located at 125 Ocean Drive. The project is expected to be complete in about 18 months. Demolition on the site has already begun and the prices for the units will range from $1.5 Million to $10 Million. The projects is unique becuase it is one of the last remaining beach sites in South Beach, and is also located in the prized So-Fi or South-of-Fifth area from which the project takes its name.

Billion Dollar Bonds Finalized for Hudson Yards Redevelopment in New York

Originally Posted on Wednesday, November 22, 2006

In a major step towards the revitalization and improvement of the Hudson Yards, the city of New York has approved the sale of $1.5 Billion in bonds. The bonds will be sold on December 4 and have been given a rating of "A-" by Fitch Ratings. The reason for the high rating is cited as the high potential for the Hudson Yards area, which is a 45-square-block area bordered by West 43rd Street, Seventh and Eighth avenues, 30 Street and 11th and 12th avenues.

Since the city changed the zoning from manufacturing to high-density commercial and is planning the extension of the No. 7 subway line into this part of the city, the area has become a hot topic on the mouths of developers.

The high rating also results from the city's committment to pay off the debt if the proceeds from the development are not enough. Most of the construction is not expected to be complete until around 2013. In addition, the city is offering tax incentives to developers who build in the Hudson Yards.

Click here to view a great slideshow of potential skyscrapers in the Hudson Yards area, taken from FLMArchitects.com: http://www.flmarchitects.com/commercial/hudson.htm

Epic Receives $280 Million Phase 1 Construction Loan

Originally Posted on Wednesday, November 15, 2006

Developer Ugo Colombo and his team of developers finalized a $280 Million construction loan for the first phase of the Epic Hotel and Residences development at the mouth of the Miami River in Downtown Miami. It is a major milestone and basically assures that the project will be completed. No plans have been made yet for the second phase of the project, that is currently occupied by the Epic Phase I Sales Center.

New Homestead Exemption rule for seniors not enough

Originally Posted on Tuesday, November 14, 2006

By: Joshua Reich

It is only rarely that I will express my personal feelings on this blog as it is supposed to be a forum for recent news, but following the recent elections I am forced to speak out.

I am glad that something has finally been done to address the antiquated Homestead Exemption in the beautiful State of Florida, but unfortunately what has been done falls far short of what needs to be done. What has been done is that a resolution was approved by voters that adds another $25,000 in Homestead Tax exemption to the existing $25,000 for low-income seniors. Since the constitution also allows local governments the option of granting an additional $25,000 exemption to low-income seniors the maximum exemption available now is $75,000.

While this is definitely great news for low income seniors it is a slap in the face of ALL homeowners who should be seeing the homestead exemption at least doubled. The Homestead Exemption was created in 1862 by an act of the United States congress and the most recent ruls were adopted in Florida in the 1980's (click here for more information on the Homestead Exemption). Property values in Florida have more than trippled in the last 20 years and the fact that the amount available for Homestead Exemption has remained steady at $25,000 is a perfect example of government falling behind in its responsiblities to the people. The current housing market is suffering in Florida becuase of 2 things: Insurance that we can do nothing about (just pray for no hurricanes) and Taxes, that we CAN do something about. A recent article says that the Florida legislature is lowering its income projections for the first time in 5 years becuase taxes have been skyrocketing while property values boomed. Now the tax burden is becoming to great and many of our best citizens are leaving the state!

The Homestead Exemption must be raised to more accurately reflect the tax burden that is now posed to owners of property in the State of Florida or what should be a continued BOOM will turn into a big fat bust becuase of inadequate government.

Contact the Florida Legislature at http://www.leg.state.fl.us/

Current State of the South Florida Real Estate Market

Originally Posted on Saturday, November 11, 2006

As we launch the new version of BlueCoastOnline.com and begin our series exploring the South Florida real estate market the current market has been on a gradual flattening for the last several months. Although, to the disapppointment of many doomsayers, the market has not crashed, no imaginary "Bubble" has burst in South Florida. The South Florida real estate market has solid funamentals the protect it from some of the more dramatic drops that may be seen in other parts of the country. Prices are flat though in South Florida over the last year. The Median price of a condo today is $270,800 and was $269,200 a year ago, a 1% gain, according to the Miami Metropolitan Statistics Area (MSA). The median price of a home today rose to $167,900 a 3% gain froma year ago.

Those are the numbers, the truth behind the market is a balance between the fundamentals and the recent history and performance. This market started to really boil about 5 years ago as result of several factors coming together such as historically low interest rates, the rapid depletion of developable land, new creative financing options for developers and borrowers and the first Baby Boomer retirees and millionaires beginning to head south for the sun. The overheat saw people sleeping on sidewalks overnight to be able to buy as many units as possible in Miami's glorious new condos. Most of those condos are close to being completed now and the market has changed as so many new units become available for buyers.

This is now an excellent time to buy as the market is depressed from the hangover of the recent boom. There are more and more deals that are becoming available as people who bought late in the boom are realizing that they got in too late and need to get out now. And as more and more owners decide that the best option in the face of rising debt is to let the bank foreclose on their property there will be even more deals that become available. The bottom line is that if you have the guts to buy in a market that everyone says is "bursting" becuase you know that the fundamentals are there, then you will be the big winner when the next boom inevitably comes.

Check back next month for another update!

Construction Set To Begin On Infinity II in 2007 with More Office Space

Originally Posted on Tuesday, November 07, 2006

DYL Group in cooperation with Colonial Development Group plans to break ground on the new 559 Unit Infinty II at Brickell sometime after Spring of 2007. The main executives say that the exact start date will be determined by market factors and construction costs.

Infinity II is following the success of Infinity I that is currently under construction and is 100% sold out, with most of the 459 units in that building being condominuim residences.

In Infinity II the developers are taking a cue from the market and are adding many more office units that can also be purchased as condominiums. Infinity and Infinity II are both beautiful buildings in a location that is central to the Brickell Finanxial district and just a couple blocks from the new shopping/dining/entertainment super complex currently taking shape called Mary Brickell Village.

We will be launching a full review of Infinity II very soon on AllMiamiPreconstruction.com so k eep your eyes open!

Midtown Crossing Unveiled as First Midtown Omaha Project

Originally Posted on Tuesday, October 24, 2006

Mutual of Omaha is developing a project in Midtown Omaha, just west of Downtwon. The project is called Midtown Crossing and it will bring 200,000 sf of space for retail, restaurants and entertainment venues, 300 condos, 300 apartments and corporate extended stay residences, and approximately 2,200 parking spaces. The project is the first in the Destination Midtown project that was launched by the city in 2004. Destination Midtown is a comprehensive plan for revitalizing the once prominent Midtown district. For more on Destination Midtown click here.

Midtown Crossing is currently scheduled for completion in the Summer of 2009. The project is expected to attract new businesses and growth along one of the main corridors into Downtown Omaha. Below is a map of the location of the development as well as a rendering of the development.

Green Building Coming to Florida?

Originally Posted on Monday, October 16, 2006

Several projects have been proposed lately in South Florida as "Green Developments" according to the Miami Herald. They include: A Green Library in Pembroke Pines, an office building in West Palm Beach called Ecoplex, a 39-story office building called Brickell Financial Center at 600 Brickell Ave. and a 13-story office condo in Miami called Miami Green.

So what makes a building "Green"? Well to start with it needs to get the LEED Certificaiton designating that it meets the requirements for a Green building...these include anything from mesures taken to reduce the amount of energy that the building uses to measures that enable the building to produce lest waste. Some examples are white roofs that deflect the sun's energy, lights that turn off automatically when nobody is in the room and even gathering rain water to be recycled in the air conditioning system.

The bad news is that it costs more to construct a Green building than it does to build a traditional one.

The upside is that over time the building will save it's owners money by being more energy efficient. According to the article, builders claim that a Green building will cost 1/3 less than a traditional building to operate. This translates into far more savings over the long term
than could be saved at the beginning by not going Green.

This means that going Green is great for owners of buildings, but what does that mean for condo developers who typically construct the building and then are completely out of it, transfering ownership of the building to the condo association? The article states that the is a deterrent for many condo developers. But I do not agree...even though a condo developer will not benefit directly from the long-term savings, they can easily pass on the Green costs and get an edge on marketing if they promote their new building as "Green". Owners will be happy to pay more if they clearly understand how much they will be saving over the long term.

Great Deals on the Ocean in Baja, Mexico!

Originally Posted on Saturday, October 14, 2006

Bloomberg News reported today on the building boom in Baja that is coming as a result of the governments decision in 1994 to relax rules on foreign investment. Since 1994 momentum has been gaining and now there are big name developers such as Donald Trump, David Butterfield and John Fair that are working on projects in the area.

One of the biggest reasons U.S. investors are becoming more active in the Baja market is that more and more U.S. companies are offering escrow services and title insurance, significantly reducing the risk that the buyer will assume. This is important because in the past residents were even told to leave their homes because the land that they were on actually belonged to someone else. It appears that these complications have been alleviated by the steady influx of the U.S. Dollar over the past several years and this looks to be a gold mine waiting to happen.

Now is the time to get in, we currently are researching all of Mexico extensively for our new site PreconstructioninMexico.com that will launch in the next few months and we are taking a very close look at the projects in Baja so that we can give you the best information possible.

Below a map of Baja:

Magic Invests in Little Havana Condo Project

Originally Posted on Wednesday, October 11, 2006

Another NBA legend has decided that Miami is the best place to put his money. Los Angeles Lakers star Earvin "Magic" Johnson is part of a group that plans to develop Morrison, the largest condo project ever proposed for Little Havana. Morrison will have 395 units in two 19-story towers. The project is expected to cost $120 Million and Magic will be taking a majority stake in the venture. The purchase is being made by Canyon-Johnson Urban Funds, led by Magic and business partner Bobby Turner.

Despite the slowdown in the Miami condo market the developers say that they are confident the project will be a success becuase it will be priced in the mid-ranges and is close to the Downtown work centers. Most units will cost between $250K and $350K with only 5% required to be put down as opposed to the typical 20%.

This is not Canyon-Johnson's first foray into the South Florida real estate market. The company has projects in Dadeland and Kendall and Johnson has personally invested in Starbucks and Burger King franchises in once downtrodden parts of Downtown Miami.

A map showing the location of the Morrison project,
(To see a larger version click here)

New Target Opens in Midtown Miami

Originally Posted on Tuesday, October 10, 2006

The New Miami Central Target opened last week to the great delight of the throngs of new Downtown Miami residents. Many of the new urbanites have transplanted from the suburbs to avoid hour long commutes to work and they miss the big box retailers that they became accustomed to out in places like West Kendall, South Miami, Miami Lakes , Weston and Pembroke Pines. Now the opening of a new Target seems to bring validation to the new community of Midtown Miami even before a majority of the residential towers are completed. (Click here for more information on Midtown Miami)

This a very exciting time for Miami as whole as the Midtown Concept stretches the new urbanism that is happening closer to the Miami River and Brickell north and west. In the end this will become the new Miami Upper West Side and will attract visitors from surrounding areas as well as it's Downtown neighbors to the south. Well, I have to go to Target, be back in a minute!

Shaq Invests in Miami Preconstruction!

Originally Posted on Wednesday, September 20, 2006

Shaquille O'neal anounced on Tuesday morning the formation of the O'Neal Group, that will consolidate his considerable real estate holdings into one company and focus on new "integrated living" projects. These projects mix work, life and play all in one and the first investment that the O'Neal Group is making is in the Metropolitan Miami downtown development. The development will consiste of Met 1, Met 2 and Met 3 (Click here for more information on Met 3). It is one of the most impressive preconstruction projects in a city that has some of the most amazing projects in the world!

The O'Neal Group will have an undisclosed interest in the new development in addition to the purchase of a unit and the leasing of 45,000 square for a 24 Hour Fitness gym, that Shaq is also a partner in. The O'Neal Group has been looking all over the country for the perfect place to invest and according to Shaq, the best place they found was in their own backyard. This is a major vote of confidence in market that has been clouded with doomsayers for the last several months. Shaq's confidence in the preconstruction market and the Downtown Miami condo market in general may be just what the area needs to take that next step to being a global city. Preconstruction is just the beginning in this case but the concepts that were formed in the minds of the developers that are not that much closer to reality are the true story of preconstruction.

Preconstruction or Pre-construction?

Originally Posted on Thursday, September 14, 2006

I have been asked at times why it is that we chose to name the company Blue Coast Preconstruction as opposed to Blue Coast Pre-Construction. The question is asked because the "proper" way to write it is with the dash.

The decision was simple for two reasons:

1. If we used the Pre-Construction in the company name then we would have to use it in the the web address so it would be www.BlueCoastPre-Construction.com. Can you image having to constantly tell people Blue Coast Pre Dash Construction.com? The domain is long enough as it is, this would have just further confused people, and confused people are not good customers.

2. The word Pre-Construction conveys that the Preconstruction portion of developing a project is somehow secondary to the actual construction. While this may seem to be true at first thought, experience teaches us that the preconstruction phase of a project is just as important as the actual construction phase, in that if the preconstruction phase were not successful the project would not be able to secure the best financing. So Preconstruction, far from being secondary to the contraction phase, is deserving of its own official non-hyphenated name.

We are currently in negotiations with Webster to have Preconstruction added to the dictionary....well not really but that would be cool.

Until next time visit BlueCoastPreconstruction.com for the most uptodateinfoonpreconstructionprojects ;-)

Condo-Hotels: Boom, Bust or Break Even?

Originally Posted on Tuesday, September 12, 2006

In today's Sun-sentinel there is an excellent article about the Condo Hotel craze that has swept South Florida and the nation for the last few years. The article has statistics that show Florida far outpacing the rest of the nation in new Condo-Hotels under development. With 31,511 units currently in the pipeline, Nevada is the only other state that comes close, boasting 30,112 units. The other states in order of units being developed are California, New Jersey, Colorado, Arizona, Illinois, Massachusetts, Tennessee and Hawaii.

There are many things to consider when purchasing a condo-hotel unit. Since it is a business in addition to being real estate, a condo-hotel unit should be given even closer scrutiny than a regular condo or single family home. This point is amplified by the fact that there is almost no condo-hotel that will gauruntee that your unit will be rented while you are not there. You cannot determine how much travelers are willing to pay to stay at the hotel you own a unit in. And the condo-hotel cannot gauruntee that your room will rented becuase they move dangerously close to coming under the SEC's definition of a security. And even if your room is rented all the time the revenue (which you share with the hotel) will probably not cover your expenses. So will your monthly costs be offset by the profit you will eventually make by selling it?

There are defintely some things that you might not have to deal with in a regular condo, however, if you find a condo-hotel that you fall in LOVE with, meaning that you would do anything to spend all of your vacations there, then a condo-hotel is definitely the way to go. You will get a place to stay that you will own as opposed to something like a timeshare that you only own a portion of. So a condo-hotel can be a great deal if you do your homework, but it can be a disaster if you don't.

Never forget and always progress

Originally Posted on Sunday, September 10, 2006

On this day before the 5th anniversary of 9/11 it is hard not to reflect on the impact that one horrible day has had on ALL of our lives. Nevertheless the American Spirit thrives and we move forward a stronger and more mature nation. Nowhere is this more evident than at the heart of Ground Zero where New Yorkers have painstakingly finalized designs for the new World Trade Center. I have included the most representative photo below, but I urge you to visit the link to the Sun-Sentinal's slide show of all the pictures. As a work of construction the new WTC is cutting edge, as a work of art it is a masterpiece and as the following picture shows as a memorial it is perfect. Article link: Click Here.

Version 1.0

Originally Posted on Friday, September 08, 2006

It has been some time since my last post, but with good reason. We have been hard at work on Version 1.0 of BlueCoastPreconstruction.com. Following the successful introduction of Blue Coast Preconstruction last year and subsequent improvements, work has begun on the first official version of the Blue Coast Preconstruction Database. This database is comprised of nearly 100 fields of information on each development. It will be the most comprehensive database of information on new preconstruction developments from around the world.

Preconstruction is not a fad that was only a result of the real estate boom of the late 90's. It is a proven piece of the development process that is essential to the smooth transition of the project from conception to completion...think about it: if you are a developer and you are going to build a project would you want to wait until the entire project was finished and then start selling units? That would be stupid. Every developer in the world presells their projects. Whether they sell to friends and partners or to the public they are going to move their inventory as quick as possible. Combine this with the simple premise that property is worth much more when it is complete and you can see why preconstruction purchasing is a great investment.

With the new BlueCoastPreconstruction.com you will be able to find the best preconstruction deals with the click of your mouse. I will begin upadting our progress regularly on this blog, so check back!!!

JR

10 Most Frequently Overlooked Tax Deductions in Real Estate

Originally Posted on Monday, April 10, 2006

1. Deduct Loan fee "points" paid to obatin a home acquisition mortgage
2. Deduct mortgage refinance fees paid to the lender over the life of the loan
3. Deduct undeducted loan fees rfom a prior home loan refinance
4. Deduct the mortgage prepayment penalty you paid
5. If you changed residences and job location in 2005, your moving costs may be deductable
6. Deduct any uninsured casualty loss
7. Remember to deduct pro-rated property tax in the year of home sale and purchase
8. Deduct pro-rated mortgage interest in year of home sale or purchase
9. Deduct prepaid property taxes and mortgage interest
10. Deduct ground rent if your home is on leased land

The Law of the Land

Originally Posted on Wednesday, March 08, 2006

There is a lot of talk lately about the upcoming Florida legislative session and the main two issues that legslators will confront: Affordable Housing and Eminent Domain. Of these two, which will be more important is a matter of heated debate just as much as their individual implications. In many ways though, the two issues intersect.

Eminent Domain is the right of the government to require landowners to sell their land at a fair market price to the government if the government decides that it needs the land for the improvement of the area. An incredibly complex law that digs at the heart of one of our most fundamental Constitutional Rights as Americans: the right to own property. If the government can take your property whenever it feels like (so to speak) than do you really have the right to own property? Or are you just leasing the property from the government? In which case what can humans actually own that is "Real"? Although our great Mother Earth will unfortunately, as Science claims, be destroyed by the progression of our Sun into a Red Giant, the land that covers her is still the most valuable physcial asset. If we cannot own any of that as individuals then what are we to strive for?

However, we must also consider ourselves as a society, as it is that gift of communication and interaction that has given us the comforts of modern life. It is the government's role to oversee the success of the society. The government would argue that this task requires the strategic planning and structuring of the neccessary components for a modern city.

There should be no question that the government must be able to excersize Eminent Domain when the implementation of neccessary functions such as transportation, electric, water, gas, telecommunications and other utilities is essential to the success of the city and thus the people of the city. However, the government should refrain from using the right Eminent Domain unless it is an Absolute Neccessity and all measures should be taken to strike an equitable settlement of the city's needs as well as the citizens whose land is subject to acquisition.

Tomorrow...Affordable Housing!

Bridges are so 20th Century

Originally Posted on Tuesday, March 07, 2006

It would seem that building a bridge over the water would be far easier, cheaper and efficient than digging a tunnel under the water...but as if often the case, things are not as they seem. When you look at the long term effects of the structure and the impact upon the maritime industry it becomes clear that although the short term cost will be higher, the long term and maintenance costs are much lower with a tunnel. Plus tunnels are really cool!!! That's not to say that bridges are not cool; one of my favorite bridges is the Sunshine Skyway that I take to visit my Mom in St. Petersburg. It's huge and impressive, it's at least a half minute on the way up and again on the way down, but the real draw of the ride is the degree of incline, which as far as I am concerned is 45 degrees although....let me Google...WOW thats always interesting...apparently on a very stormy night in Tampa Bay back in 1980 a Phosphate ship rammed into one of the supports for the original Sunshine Skyway Bridge...horribly close to 50 people died...most on a Greyhound on its way to Miami...when the bridge was dislodged and some 2000 ft. of bridge fell into the cold stormy water.

What a story! So then they completed the current Sunshine Skyway bridge in 1987 and it has extra-special measures to protect against ramming ships....and that incline I was talking about, that is a result of the center of the bridge being raised so high that the largest of vessels can easily pass through. Herein lies the main problem with bridges: they disrupt marine traffic. So I am very pleased to see that the City of Miami is planning to build a tunnel to ease truck traffic departing the Port of Miami. This port is one of the most important ports in the United States due to it's geographic proximity to the Americas. Although it is still some time down the road, it is a forward move that a Modern World City would take to improve it's economic prosperity.

Monday monday...funday

Originally Posted on Monday, March 06, 2006

What is it about Monday that makes everything so challenging week in and week out? Is it the layover from the weekend, the entire world just woke up from a nap feeling, the collective groginess that makes everyine grumpy, irritable and difficult to work with? Is it the challenge of the week ahead and the distance to the next "break". Even though these individual feelings may not be in everyone of us, the collective effect of the masses is enough to generally throw things into dismay.

The great thing about both selling and investing in real estate, is that the normal time constraints that affect everyday people going to and fro can be avoided almost entirely with the proper planning. It is one of the supreme draws of the real estate profession and real estate investment. The idea that property and its highest and best use can be a source of income and wealth for everyone involved in it.

The private ownership of property is one of the primary foundations of our American system of freedom. You cannot be truly free, it is said, unless you own the land you make your bed on. The trials and tribulations of a Monday in the Rat Race can be nothing but a memory once the great wealth machine of real estate is put into motion effectively, diligently and persistently. Oh well until I can kick my wealth machine into a slightly higher gear, I still need to hit the grind for Tuesday. Alas good night and invest in freedom!

Flight paths, Height restrictions and the Synergy of a City

Originally Posted on Saturday, March 04, 2006

There is a battle going on in the skies over Miami that is a perfect example of the symbiotic relationship that must exist in so many aspects of a modern city. The battle is being waged by representatives of the airlines and Miami International Airport versus the developers who are building the new skyline of Miami along Biscayne Bay. The developers want to build as high as possible but the aviators say the higher the building the more complications in take-off and landing.

The complication arises because the runway at Miami International Airport is built in an East-West configuration to take advantage of the prevailing winds coming off the Atlantic Ocean and the Gulf of Mexico. Airlines must adhere to FAA regulations that require planes to achieve a minimum height if one engine fails upon takeoff. Curiously though, although the FAA requires this of airlines it was willing to approve the height limits of several new projects that infringe upon the airlines ability to achieve the minimum altitude required, without significantly reducing their fuel and cargo payload.

Meanwhile the developers who are poring millions of dollars into the local economy are being told one thing by the FAA and another by the County and even another by the city. Many developers are reporting receiving three different approvals for the heights of their buildings and then the ire of MIA when they accept the approvals.

This situation brings to the forefront one of the most important relationships in a modern city: that of the transportation providers with the housing providers. In a geographic area such as Miami, where the Florida Everglades provide a natural western development boundary, vertical housing is essential to the vialbility of the housing market and in turn the success of the region's economy. The task must remain then to our legislators and government representatives to ensure that the proper balance is struck between too high (for MIA) and too low (for the developers). The future of the City of Miami as well as the entire South Florida Tri-county area may be at stake.

UDB boundry good for condos

Originally Posted on Wednesday, March 01, 2006

In a recent speech Miami-Dade Mayor Carlos Alvarez, a room full of applause followed the Mayor's admonition to "hold the line" in reference to the UDB or Urban Development Boundary. This imaginary line has become the source of much contention as the population of the Tri-County Area booms and the amount of developable land evaporates. The UDB is basically the edge of the Florida Everglades; however, it is some ways out from the actual Everglades National Park boundary that will likely never be breached. The urbanization of South Florida has led to the pollution and interference of the Everglades for the last few decades but there has always been a strong push to protect the "world famous wilderness and marine ecosystem."

Florida is Paradise...Regardless of occasionally high winds...

Originally Posted on Tuesday, February 28, 2006

Occasionally, in the Summer time, Florida becomes ground zero for those incredibly blustery beasts for which the greatest college football team of all time is named: Hurricanes. Ah yes, for anyone who has never experienced a hurricane they are really not that bad...as long as you are prepared. Don't ever go through a hurricane without the essentials such as plenty of batteries, flashlights, candles, ice, drinking water, canned food, etc. Of course you could drop some serious cash on a full house generator and avoid all the power outage problems. But in the end it requires only a small amount of foresight to deal with even the worst of storms. They are usually gone in about a day and the few days leading up to a storm can be both exciting and nerve racking. All of it is quite an adventure but is a small price to pay for some of the most beautiful weather in the world for most of the year.

Luckily for South Florida's economy, the hurricane season happens to run in the "off-season" in the heat of Summer while most of our Northern temporary residents and tourists are enjoying the termporary nice weather of their own state. If hurricanes came during the Winter we might have some serious problems. But as things are, we're doing juuuust fine...according to an article in the Sun-Sentinel today, Florida set a record for tourists in 2005 with 85.8 Million people flooding into the Sunshine State from all over the world. The Miami Herald also reported recently that despite a drop off following the 9/11 attacks tourism has risen steadily to record levels the last couple of years. All this during the two most active hurricane seasons in Florida's history. Very good news indeed. Especially for those of us who have an interest in Florida property. Becuase of course once you have seen paradise (and how low the taxes are to live there) you will never want to leave!

The Big Picture...Circle

Originally Posted on Saturday, February 25, 2006

Its been a few days since my last post because things have been busy, two closings and several new projects announced. Even though all the talk is about a cooling market there is always something going on it seems and of couse time flies when you're having fun! But with all the new development an issue has been on my mind and I think I have come to some conclusions. Back in 1998 the Miami Circle, an ancient Tequesta Indian monument that has been described as America's Stonehenge, was discovered at the mouth of the Miami River while surveying the site for a new development. An impassioned movement ensued that resulted in the protection of the Miami Circle from further development.

However, there were always voices that objected to the sacrifice of prime waterfront real estate for the sake of a long forgotten civilization. Today the issue is manifested in other ways such as the proposed movement of the Urban Development Boundary that protects the Florida Everglads from the Western surges of Miami developers. It is also posing issues on the northern side of the Miami River at the construction site of the new Met Miami. An ancient Tequesta Indian cemetery has been found on the site and construction has been delayed while the developers finds a suitable relocation point on the site...an interesting solution.

So the dilemma in my mind has been to decide which I believe is more vaulable: The land for the possibilty of new development and wealth creation OR the land for its environmental, cultural and historical signifigance and value. But I have realized that the answer, as it so often does, lies in the combination of both sides of the equation. The value of the preservation of natural and historical sites is key to the growth of Miami as a World Class City, small and even large pieces of land that are sacrificed for their intrinisc value will serve to actually raise the value of all the surrounding land and property, near and far in South Florida. Even today the Icon at Brickell by the Related Group the Miami Circle is being respected and incorporated to the current development. If we as a city and a metropolitan area can strike the right balance between nature and structure we can be an example for the rest of the World, and that will be good for everyone's business.

Homeowners Trapped?

Originally Posted on Monday, February 20, 2006

There was an article in the Miami Herald yesterday about how many Homeowers feel "trapped" in the current home because if they move their taxes will increase so much. The reason for this is that the Save Our Homes amendment which basically limits increases in property taxes to 3% per year is NOT TRANSFERABLE TO NEW PROPERTIES. Everytime a property is sold its taxable value is reassessed and the new owner has to pay taxes on the newly assessed value. Since proerty values have been appreciating so rapidly owners face paying tens of thousands of dollars more per year in taxes if they move.

Thankfully, some legislators are working to change this and the excellent article by Michal Mayo (which can be found here) goes into some detail. However, the aritcle only makes brief mention of the need to increase the $25K Homestead Exemption as a result of increasing values. The State of Florida has some of the most geographically valuable land in the world and the consistent population numbers show that PEOPLE WANT TO LIVE IN FLORIDA! That means land will continue to get more valuable!

The Homestead Exemption was created in the early 70's when Median Home Values were much lower than they are today. Legislators need to do more to keep the State's laws up to speed with the changing times...Florida is and should continue to be a leader in rights and benefits for property owners and prosperity will be long lasting in the Sunshine State.

Land Use Up To County Or City?

Originally Posted on Saturday, February 18, 2006

There was an excellent article in the South Florida Daily Business Review that detailed a power struggle that is currently brewing in Broward County regarding who has the right to decide what to do with the land: the individual municipalities or Broward County. It is an interesting situation becuase Broward County currently makes the determinations as to how the land will be used, but the argument made by proponents of the municipalities states that those making decisions on how the land in their city should be used may have never even been to the city.

This does seem to be a valid argument especially in a case such as Broward County where the land has been 80% developed. However, it is precisely this point that commissioners use as justification for their having the say. They argue that when a region is nearing its capacity for new developable land, it is crucial that what remains be coordinated at the regional level rather than the city level. It seems this is a very important issue with no clear right or wrong answer.

There should be some sort of interaction between the cities and county in order for cities to provide input around an existing and evolving plan that will ensure long-term regional growth and prosperity. Hopefully, the Internet will continue to enable citizens to communicate and interect with their government live never before and conversely allow the governments to interact with one another on a truyl cohesive level that benefits everyone.

1390: Anatomy of a Cancellation

Originally Posted on Friday, February 17, 2006

Yesterday it was reported in both the Miami Herald and the South Florida Daily Business Review that the developer of 1390 Brickell Bay has cancelled the project due to higher than expected construction costs. Deposits will be returned to buyers, most of whom have been without their original deposit for more than a year. This is an inherent risk in investing in Preconstruction Real Estate becuase you are giving money for something that has not even been built. If a cancellation does happen most developers will return deposits promptly and most will include some small interest earned on the deposit. Luckily we didn't have any buyers with units reserved in 1390 Brickell Bay. Although the project has been handled in a very professional and open manner from the beginning and I am sure buyers will get there money back...they would rather have the unit they decided to purchase.

So why did 1390 Brickell Bay fail? Did the developer grossly underestimate construction costs? Did the "Bubble" that has been so widely reported finally rear its ugly head and put downward pressure on prices, thining the developer's margins to almost nothing? I suspect it is a combination of these factors and a little bit of that old Real Estate mantra: Location, Location, Location. 1390 Brickell Bay would have been located in a less than inspired piece of land that is in fact not on the bay but accross the street from it. Also accross the street: the Jade (2004), the Emerald (2005), the Sail (2005), the Club at Brickell Bay (2005), Solaris (2006), and Villa Magna (2007). With so many projects within a few blocks and many others within a square mile, only the strongest and most desirable projects will be completed. It is now more important than ever before to scrutinize the Developer, the surrounding competition and the market factors that might affect a project's viability before making a decision on which property to invest in. The good news for non-1390 Brickell Bay owners of preconstruction condos in Brickell is that there is now one less building to choose from and demand remains very high. If you are in a good project, and you can weather a brief storm of uncertainty and doomsday predictions, then you stand to profit greatly in the next five years.

Hot weather = Hot market

Originally Posted on Tuesday, February 14, 2006

According to a recent housing report the inventory of housing units in Miami is up by 39% in the last year. That is bad news for Realtors but good news for Buyers...as I said in my last entry....However, it seems that price gains are not slowing as much yet as analysts have anticipated. In the last year, price gains have slowed less in Miami than in other markets including markets on the West coast of Florida according to the report. This is undoubtably due to Miami's burgeoning place in the global economy and the constant influx of residents from the Americas, Europe and now even Asia.

Anyone who has been to Miami knows the incredible mix of cultures that is present in almost every facet of our daily lives. We have been called the Melting Pot of the United States for good reason, walking down the street in Downtown Miami today I decided to count the number of different nationalities that I noticed...I stopped counting once I got to 10, and this was in a matter of only a few minutes. The only other place I have experienced this kind of diversity was in New York, a city that has attracted the best and brightest from around the world for hundreds of years. So why has the New York market seen faster price drops than Miami? It's way too cold!!! Seriously, I'm not just saying this becuase I am a South Floridian. Becuase of the new Internet based economy, workers now have more freedom to choose where they would like to work. Since so much work can be shared and transferred digitally or done from remote locations, more and more companies are now able to offer their employees and executives the option of living where they WANT to live instead of where they HAVE TO LIVE. Moreover, many of the companies that are adopting the remote and virtual office concept are the same ones that are leading innnovation and offering the highest paying jobs in our increasingly techno-interconnected world. These highly successful and motivated individuals want to work where they are comfortable...today's mid day Low in South Florida is 65 degrees...and this is the coldest day of the winter so far! I had to wear an undershirt a collared shirt and a jacket!!! It was freezing this morning...like 45 degrees!!! If you are currently in the Northern part of the country I sympathize but do not empathize, becuase having been fortunate enough to be born in paradise I don't plan to leave anytime soon.

And 1400 NEW RESIDENTS FLORIDA EVERY DAY probably agree with me. The difference between today and even 5 years ago is that back then most new residents to Florida were retirees or individuals looking to finish out their career in comfort after achieving so much seniority back in the snow. Becuase there was no Internet there was no way a working professional could be effective and productive so far from the home office. But as with so many other things...the Internet changes everything. So quit shoveling your driveway and de-icing your windows and come join us like everybody else...the Coconut Grove Arts Fair is this weekend and it's entirely outside...in the Sun!

The 2006 Preconstruction Buyer's Market

Orginally Posted on Saturday, February 11, 2006

As 2006 gets really rolling here in February we are in the midst of the first Buyer's Market in years as the market cools and appreciation returns to more maintainable levels. This is great news for buyers of existing properties becuase now that the bidding-wars have stopped there is finally room for negotiation...and the sophisticated Buyer who is well advised by his Real Estate Agent can save tens of thousands of dollars simply by asking. But how does this new market affect Buyers of brand new shiny Preconstruction Properties? Since you can't negotiate a price with a Developer how can you benefit from a Buyer's Market?

Well the first thing is that you can negotiate a price with a Developer. The market is slowing and many Developers are desperate to meet project deadlines or face losing millions in profit so they will indeed make actual reasonable concessions on prices, usually in the are of Premiums for height or view in hi-rises and lake or golf view in single-family and townhome preconstruction. However, beware of those willing to bend over backwards as it may be a sign of project instability. A Preconstruction Specialist, such as your's truly, will be able to tell you if a Developer will complete a successful Project.

The second thing is that Developers are incredibly sensitive to the market and many will offer Concessions in various other forms, such as free Maintenance, lower Down Payment requirements, Financing options or special Contract Terms. The trick again is that many of the Developers who are offering the biggest Concessions are the ones who are in trouble financially and may not finish a project. The sophisticated Buyer who is well advised by a Preconstruction Specialist will know which Developers will finish a project based on factors such as the Developer's history, the financial state of the Project, the location of the Project and of course the Preconstruction Specialist's professional opinion of the project. Having seen thousands of projects I can tell you there is a feel for the project from the first point of contact to every bit of communication from that point on. If you know which Developer will succeed in your desired location you can decide from those offering the best concessions and save tens to hundreds of thousands of dollars or even millions depending on your particular needs...

First Post...

Originally Posted on Friday, February 10, 2006

Hello world...