South Florida Business Journal
September 14, 2012
Cash, Location Move Miami Beach Condos
By Jeff Zbar
The corner unit at the Apogee condominium in Miami Beach’s SoFi (south of Fifth Street) district is remarkable for a number of reasons.
It’s a 4,154-square-foot unit that features four bedrooms and three-and-a-half baths. Across the 2,400-square-foot, wrap-around terrace and outdoor summer kitchen are southeast views Fisher Island, Government Cut, the Atlantic and the Miami skyline.
The money that fueled the deal also was noteworthy. After less than three months on the market, it sold for $6.2 million in an all-cash transaction. Worldwide Properties’ Alan Araujo represented the Brazilian seller; the buyer plans a complete remodeling, the company reported.
The sale equates to almost $1,500 a square foot, said broker Eddy Martinez, Worldwide Properties CEO. The region is an “extremely desirable location for these investors from overseas, and many of them are paying cash in order to get the best value for their dollar,” he said in a news release.
All-cash deals are nothing new in South Florida.
“Ninety percent of the deals south of Fifth are all cash,” said Kevin Tomlinson, VP with One Sotheby’s International Realty in Miami Beach.
The all-cash buy was one of several recently. A four-bedroom, five-bathroom unit at Continuum Miami Beach sold for $6.575 million. The unit, at 100 S. Pointe Drive, No. 3007, had some 4,004 square feet and was built in 2003. Tomlinson was the all-cash deal’s listing agent.
What the Brazilian purchased at Apogee was a luxury lifestyle in a unique location. Spanning 3 acres of waterfront at the tip of Miami Beach, the Sieger Suarez Architectural Partnership-designed property features a fitness center, infinity-edge lap pool, private and climate-controlled two-car garages, and private elevators to each unit – with only four residences per floor.
Cash remains king for many buyers, online real estate news site World Property Channel noted in an August report. Countywide, all-cash sales accounted for 64 percent of total closings in July, up from 59 percent a year prior, the site reported.
The money often flows in from Latin America or Europe. Nine in 10 international buyers in Florida purchase properties all cash, World Property Channel founder and CEO Michael Gerrity said. With more than 150,000 millionaires in Brazil, and “flight of capital” from volatile markets like Venezuela, sellers and Realtors can expect some continuation of cash deals, he said. A slowing of the Brazilian economy has led some investors to “tap the brakes,” but not in significant numbers, he said.
Argentines also are joining the buying trend, according to a June report in the South Florida Business Journal. The Related Group hired Fortune International, led by Argentine Edgardo Defortuna, to lead the sales charge for its 42-story, 382-unit Millecento Residences. One consultant said Argentines, like Brazilians, are helping fuel a fever for high-end condos, the paper reported.
The practice has moved up the state – and East Coast, he said. Brazilians are the dominant buyers of properties in Orlando and Kissimmee, and today they’re outpacing Russians as top buyers of New York residences, he said.
You can’t beat the math, Gerrity added. Between condo fire sales and the strength of the Brazilian real versus the dollar, some buyers have gotten condos at “20 cents on the dollar relative to their own currency,” Gerrity said. With that kind of discount, “they’re buying one for themselves and four others as investments.”