27 Jul 09 Occupancy Rate In New Downtown Miami Condominiums Eclipses 60 Percent, Continues To Trend Upward
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Occupancy Rate In New Downtown Miami Condominiums Eclipses 60 Percent, Continues To Trend Upward
Independent study finds healthy occupancy in Miami’s urban core; market on track to reach equilibrium sooner than expected.
MIAMI, FL – June 10, 2009 – 62% of the residential units completed in Downtown Miami since 2003 are occupied and the closing rate is accelerating despite obstacles to financing, according to a Residential Closings & Occupancy Study commissioned by the Miami Downtown Development Authority (DDA).
The study, which was conducted by independent research firm Goodkin Consulting/ Focus Real Estate Advisors, assessed occupancy and closing rates for 73 condominium buildings and seven rental apartment buildings that have come on line in the Downtown Miami area since 2003. Combined, the 80 buildings account for 22,959 residential units.
“This is the first study since the start of the construction boom that provides a complete picture of the number of people living in Downtown Miami,” said Lewis M. Goodkin, CRE, FRICS, MIRM, founder of Goodkin Consulting. “Our research indicates that sixty?two percent of units in new Downtown Miami buildings are occupied by a combination of owners and renters, defying the perception that the majority of high?rises built in recent years are empty.”
According to Craig Werley, founder and president of Focus Real Estate Advisors, the increasingly attractive pricing and location of Downtown Miami continues to generate demand from both buyers and renters in the marketplace. “Considering the financial roadblocks that many homebuyers have faced over the past year, the sales activity that we’ve seen in recent months is encouraging.”
The study suggests that heightened demand for urban living, new programs aimed at easing home financing restrictions, record low interest rates and further price discounting will likely accelerate the closing rate – with arrival at market equilibrium probable within three to four years. Occupancy will trend upward in that span as the existing inventory is absorbed and no new residential buildings are built, according to Goodkin.
“The results of this study underscore what those here already know: Downtown Miami is alive and well,” said Alyce Robertson, executive director of the Miami Downtown Development Authority. “Our growing residential population is drawn to our waterfront location, entertainment and cultural offerings, strong commercial base, and to our standing as Florida’s largest employment center. Those moving here are full?time residents who are populating our City streets and fueling the local economy.”
Significant findings from the Miami DDA?Goodkin/Focus Closings and Occupancy Study include:
• Of the 21,616 new condominium units studied, 13,337 have closed and 98.6% of the closed units are occupied.
• Average monthly sales of new units during the past three months increased over the three months prior, with a 12?month average of approximately 70 recorded closings per month.
• The average monthly sales and leasing activity of new units has been averaging approximately 350 units per month.
• During the four year period from 2004 through 2007, an average of more than 2,000 condo units were absorbed annually; in 2008, more than 4,200 units were sold, despite the collapsed housing market and general economic recession.
• Of the total inventory of residential properties for sale in Miami-Dade County last month, 26% are located in Downtown Miami.
• Historically, more than 70% of Downtown Miami residents were renters. So the balanced 50:50 mix between owners and renters in new Downtown condominiums indicates a steady increase in home ownership among area residents.
“Up to now, much attention has been focused on Downtown Miami’s excess inventory of condominiums,” said Goodkin. “With this study, we have established that there is a healthy occupancy in Downtown that we anticipate will steadily increase as buyers and renters take advantage of the return to realistic pricing in the housing market.”
The survey results support projections forecasting continued population growth in Downtown Miami. According to U.S. Census’ projections, since 2000, the Downtown area’s residential base has grown from 40,000 to 60,000, with more than 10,000 residents expected to move in over the next six years.
The DDA plans to update this study on a regular basis, and expand the scope to the entire residential building base of Downtown Miami to have a better understanding of the residential population. “
Just by walking around on Brickell or Biscayne, it’s clear that the new Downtown residential population is filled with a diversity of people who are adding vibrancy to the area,” said Robertson. “The more we can glean about this demographic, the better positioned retailers and service providers will be to meet their needs.”
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Tags: Downtown Miami, Miami Downtown Development Authority, new condominium
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Although I recognize the increase of occupancy and am a firm believer that eventually Downtown will fill up, I see a number of statistics in this article that I find difficult to believe.
“Of the 21,616 new condominium units studied, 13,337 have closed and 98.6% of the closed units are occupied.” There is absolutely no way 98% of the closed units are occupied.
“in 2008, more than 4,200 units were sold, despite the collapsed housing market and general economic recession.” This must account for pre-construction closings of properties that sold in 2003-2006.