The cycle for new multifamily construction is ending, and owners of multifamily development sites are looking for an out.
It makes sense. Many developers are putting their sites up for sale following a period of rapid growth fueled by the pandemic boom. Then came the slowdown, brought by unsustainable costs for land, financing and construction.
On top of that, developers have to offer more concessions to tenants to lease units at their buildings, commercial broker Tony Arellano tells Lidia Dinkova. A deluge of completed projects in 2023 and 2024 suppressed rent growth. And rents are falling in some neighborhoods.
Developers deny that high costs are why they’re listing their sites.
“Some of these guys bought at the top of the market. They were overleveraged, and they thought everything ws going to keep being peachy, that the rents would be peachy, that with Trump being in power, interest rates would have dropped,” said Miguel Pinto of Apex Capital Realty. “None of that has happened.”
And not all of them are publicly listing their sites. But they would sell if the price makes sense.
Sebastian Faerman, a commercial broker at Fortune Christie’s, said developers who didn’t have shovels in the ground a couple of months ago will not be going vertical this cycle.
Still, some of the properties are owned by land-bankers who never planned to actually build. Their business model is to buy, entitle and flip — this includes those tapping the state’s new workforce housing law, the Live Local Act, to boost their site’s density and height allowance.
In Wynwood, Clara Homes listed its site, home to the former Austin Burke menswear store, for nearly $11 million. Clara paid $7.7 million for the nearly half-acre site, filed plans for a Live Local project, and secured approval for the 22-story, 147-unit tower. But Clara, led by James Curnin, switched course with the listing.
Curnin agreed that Wynwood has high inventory, but he said that’s not why he listed the Clara Wynwood site. He also cited issues with a strung-out site plan approval process, one many developers complain about.
“I just want to move to bigger and better things,” said Curnin.
What we’re thinking about: Billionaire Adam Neumann’s Flow (and partners) took a majority stake in Chetrit Group’s Miami River development, one megaproject we’ve been tracking for a decade. What does this deal say about the market? Send me a note at [email protected].
CLOSING TIME
Residential: Patrick K. Willis sold a single-family home at 2900 Northeast 37th Street in Fort Lauderdale for $27.4 million to former race car driver and racing company owner Michael Andretti. Willis, who owns a repo company, paid $12.5 million for the nearly 14,000-square-foot mansion in 2021.
Commercial: Private credit firm Favo Capital paid $190 million for the 22-story, 277-unit apartment tower at 1818 Hollywood Boulevard in Hollywood. GCF Development, a Hollywood-based firm led by Charles “Chip” Abele, obtained a long-term equity stake in Favo as part of the all-stock and assumption of liabilities deal.
— Research by Mary Diduch
NEW TO THE MARKET
Spec home developer Todd Michael Glaser and the Posner Group are looking to flip for $169 million the waterfront Miami Beach estate they bought for $105 million in July. They also listed the 2.3-acre estate at 5940 North Bay Road for rent, asking $495,000 a month. Nelson Gonzalez of Berkshire Hathaway HomeServices EWM Realty has the listings. Glaser could sell or rent the existing home as is, but he is also moving forward with plans to develop a spec mansion that could hit the market for $300 million.
A thing we’ve learned
Florida’s population will likely surpass 24 million by 2027, but overall growth is expected to slow within the next few years, according to a report by the Demographic Estimating Conference. The state’s population hit 23 million people last year.
Elsewhere in Florida
- Miami real estate agent Leila Alessandra Trinchero was arrested after police said she slapped a 72-year-old man and another woman during a dispute over a chair at the new Eataly food hall at Aventura Mall, sending him to the hospital, Channel 10 reports. Trinchero is licensed with AvantiWay Realty. The older man was trying to break up the fight between Trinchero and another woman.
- Gov. Ron DeSantis announced plans to convert a vacant North Florida prison into an immigration detention center for more than 1,000 people, calling it “deportation depot.” The move comes as a federal judge considers shutting down the state’s controversial Alligator Alcatraz facility over environmental concerns, according to the Miami Herald.
- Fort Lauderdale overtook Miami as Florida’s most sought-after rental market, ranking No. 1 in the state and No. 20 nationally, according to a RentCafe report cited by the Sun Sentinel.
- Hurricane Erin, which became a Category 5 storm over the weekend, marks the first hurricane of the 2025 Atlantic season. It’s on track to curve north between the East Coast and Bermuda next week, NBC News reports.
