Real Estate

Take a dip

ONE TO WATCH: The eye-catching One Bal Harbour is on the ocean and near the pricey Bal Harbour Shops.

ONE TO WATCH: The eye-catching One Bal Harbour is on the ocean and near the pricey Bal Harbour Shops. (
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WOW: W South Beach has closed $170M.

WOW: W South Beach has closed $170M. (
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There are many ways to take the pulse of the Miami market, many methods of observing and appreciating and worrying about its real estate. But as developer Gil Dezer says, “You haven’t really seen Miami until you’ve seen it by boat.”

So, late on a recent Saturday afternoon, obligations are ignored, schedules re-jiggered, and a sunset cruise on Miami jewelry mogul Bobby Yampolsky’s 72-foot boat commences. The small group of VIP guests includes Dezer and Francois-Henry Bennahmias, president and CEO of Audemars Piguet North America. (This is a friendly gathering, but Yampolsky is in business with his guests, too: One of his East Coast Jewelry shops is in Dezer’s Trump International Beach Resort, and East Coast moves a lot of Audemars Piguet watches.)

These are men whose fortunes are dependent on selling something nobody really needs: diamond-encrusted bracelets, vacation homes and $20,000 limited-edition timepieces. And, recession or no, they are in a good mood as the boat leaves North Miami Beach.

In the background, one can see Dezer’s Trump Towers, a three-tower, 813-unit Sunny Isles Beach development that’s sold more than $150 million of condos in its second tower this year — at prices around $450 per square foot, with an average transaction around $880,000. (Tower III sales started a few weeks ago.)

“We were just amazed at how many people have the ability to pay cash,” Dezer says a couple days after the boat ride, noting that about 80 percent of his recent transactions have been with all-cash buyers. “It used to be [developers] would take 20 percent down and wait three years for the rest of the money. Now a guy walks in Monday and can close on Wednesday.”

Recent price reductions have no doubt been significant. Dezer’s nearby Trump Royale condo building, which once fetched around $1,000 per square foot, is now trading oceanfront units — with terraces, Miele and Sub-Zero appliances and master-suite Jacuzzi tubs — at around $550 per square foot. (“The Royale is where we got stuck,” Dezer says, freely admitting that many buyers walked away from deals during the economic downturn. “We had 364 units sold out of 384. Only 90 came to close. We have sold about 190 in the last two years.”)

The boat passes Bal Harbour, where excitement about the St. Regis Bal Harbour hotel and condos, scheduled for completion in 2011, is growing. But there’s already the beachfront One Bal Harbour, where condo resales are around $850 per square foot and the developer might put hotel-condo units on the market at around $1,000 per square foot next year. On the same day as the boat cruise, the hotel hosted a runway show for Kiki Hamann Canine Couture, which sells $500 dog dresses. “The spending pattern [in Miami] is finally coming back,” says Florent Gateau, general manager at One Bal Harbour. “You see it at the Bal Harbour Shops.”

Right across from the St. Regis site are the fancy-pants Bal Harbour Shops, where the 700-square-foot Audemars Piguet store racked up more than $6 million in sales last year. “Even though last year was bad in terms of the economy, we were the second brand in terms of revenue per square foot at the Bal Harbour Shops,” Bennahmias says. (No. 1 was a jeweler that declined to comment.)

The store’s average transaction was around $30,000, largely powered by a customer base that is about 60 percent Latin American, Bennahmias adds. “Business overall in Florida is picking up; many retailers are calling to get the brand,” he says. “But I just cannot sell to everybody.”

Yes, there are those in the Miami luxury market who can afford to be selective. Members at Miami Beach’s new Soho Beach House, for example, report that the club has sold its initial memberships ($1,800 per year, $900 for those under 27) so briskly that it is being extra choosy about additional members.

The boat heads down to South Beach, where the W South Beach Hotel & Residences closed a $6.2 million sale of a fully furnished, three-bedroom, 2,752-square-foot unit (with a 2,090-square-foot rooftop) in September. The W, where LeBron James celebrated after announcing he was taking his “talents to South Beach,” has closed on about $170 million of condos, including an all-cash deal for a 1,950-square-foot, $3 million unit this month, says developer David Edelstein.

“The enthusiam [surrounding James] is like having another entertainment venue open up,” he says. “People will extend their stay — a lot of games are Mondays and Fridays — to see the Heat.”

Of course, all is not so rosy in Miami, especially in the downtown areas near the Heat arena. The boat passes the tony, private Fisher Island. Next up is downtown, where thousands of condo units along the river and beyond remain empty. By now, it’s dark — which makes downtown, with entire buildings without a single light on, seem even more depressing.But Dezer sees opportunity here, too, and says he has been bidding on multiple downtown buildings.

And the truth is, the emerging neighborhoods that make up downtown are showing serious signs of life. In the area north of Brickell Avenue, which Ocean Drive magazine just christened “NoBri,” the new, ultra high-tech JW Marriott Marquis hotel is home to a 10,000-square-foot, NBA-approved basketball court and a soon-to-open Daniel Boulud restaurant. The hotel is part of Metropolitan Miami, a billion-dollar mixed-used development, where the 40-story Met 1 condo building has prices starting at $350 per square foot and 447 units that are 80 percent occupied.

A few miles away, another mixed-used development, the $2.3 billion, 56-acre Midtown Miami complex, has created its own neighborhood.“The idea was to have it be a very pedestrian-friendly environment,” Midtown developer Jack Cayre says. “A lot of people call it home now.” (So do about 900 dogs.)

Midtown’s three residential towers, with more than 900 units, were originally intended to be all condos. Midtown sold about half the units (closing condos for around $350 per square foot in 2007) and decided to rent the rest. The rentals are now more than 95 percent occupied. (One-bedrooms start at $1,500 and 800 square feet.) And Midtown’s big-box stores, boutique shops and destination restaurants like Sugarcane and Sakaya Kitchen, bring in the masses.

Lee Brian Schrager, who runs the South Beach and New York Wine and Food festivals and lives in Miami’s Design District, says he visits Sugarcane at least three times a month, sometimes walking the less than 2 miles there. “Before Sugarcane opened [in January], I had never been to Midtown before,” he says. “Now that we go, we sometimes stop at Target and West Elm, and eat at Mercadito, Five Guys and Cheese Course fairly often, as well. To me, Midtown now has a pulse, and that clearly came from the culinary scene.”

The boat leaves downtown and cruises back toward North Miami Beach. After an entertaining and enlightening almost-three-hour ride, Yampolsky and friends are back on land. It’s not even 9 p.m., still early for Miami on a Saturday, and the restaurants and bars near the dock are just starting to buzz.