1736 W. 28th Street, Miami Beach, Sunset Island I

Lindemann bought the property in 2000 for $8.425M. Villa Tranquilla was built in 1936 and was designed by noted Palm Beach architect Mauricio Fatio. The single-story neoclassical estate has more than 11,000 SF and seven bedrooms and baths. The equally impressive lot boasts 70,000 SF and 453 linear feet of prime, wide-bay water frontage.

Lindemann, an avid contemporary art collector, purchased the property in 2000 and enlisted German architect Annabelle Selldorf to refresh the property. Originally listed in March 2009 for $29,900,750, a sale price of $19.8M doesn’t break any PPSF records, BUT puts it right up there with Star Island estates, which sell for $1,700 to $2,400 PSF.

In 2008, Lindemann’s parents sold their home in Palm Beach for $68.5M.

Related Reading:

• Miami Beach Real Estate: Mid-Year Luxury Waterfront Stats
• Miami Beach Real Estate: Lenny Kravitz Lists Home; Prominent Sunset Island Estate Listed for $29,900,750

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Wow.  It is insane out there.  Our “season” usually tapers off right around June. This post won’t reveal such shocking stats, but I will clue you in on what is happening right now. Deals that will show up in Q3 will really surprise a few.

Basically, the average PPSF is still hovering in the low $700s, which is what I expect will continue for the next year or so.  What did happen this year was the first residential deal to break $20M since 2008 – 13 Star Island Drive sold for $25.5M.

This transaction flirts with Miami Beach’s all-time highest recorded sale of $27M. Back in Oct. 2008, Robert Toll bought five lots on the tip of Sunset Island II for $22.5M.

Luxury Miami Beach Real Estate Sales to Date

As you can see, we’ve already basically surpassed 2009.  It’s clear that 2009 was the year to buy.  Current inventory is at an all-time low, especially at the ultra high-end of the market.

Most Expensive Homes in Miami Beach

• 3 Indian Creek Drive, Indian Creek Village: New Construction – $60M
• 5800 N. Bay Road, Miami Beach: JLo’s old home during the “Bennifer” days – $34.5M

Looking at the Miami Beach Real Estate Sales of 2011

The big story last year was North Bay Road. There were four large sales ($9M+), which were mainly due to those ball players buying two homes there.

So Far, It’s All About the Venetian Islands

The Venetian Islands have ruled Miami Beach real estate in 2011, with 42% (or 15) of all waterfront sales occurring there. Wow. The Islands racked up just 13 sales in all of 2010. The activity this year is pretty surprising considering all of the construction on the Venetians.  But, this is also the year that sellers are finally listening to what the market is saying and pricing their properties lower accordingly.

Sunset Islands

Also of note are the Sunset Islands. There were a couple of “knock down” sales last year, and three transactions in 2009. Nothing to write home about.  So far this year, two homes have closed, and there are another three homes pending; two of those are VERY prominent homes.

Star Island

There’s been intense activity on Star Island this year.  As you probably know, local attorney Roy Black purchased 45 Star Island.  Though the media went into overdrive, this is the first house on the southeast side of the island, and it is closest to the causeway. 13 Star sold for a near-record $25.5M in 90 short days. 35 & 36 Star Island Drive sold for $12.25M in February. That parcel is comprised of two 40,000 SF lots, and the seller was Philip Levine.

Donald Pliner listed his home this year at 29 Star Island Drive for $24M.  The Moroccan-style estate has since been reduced to $21M.

Big Miami Beach Real Estate Deals Ahead

It seems that our luxe neighbor to the north, Palm Beach, has had many sales in excess of $20M this year.  I know of two homes that will close in the relatively near future and add to these numbers.  One is a very prominent home with a very prominent owner, and the other pending deal may very well break the all-time highest sale record by closing for more than $27M. Additionally, a plot of land on tony Indian Creek Island is said to be under contract for $15M.

Finally, embattled businessman Claudio Osorio listed his home at 15 Star Island Drive for $14.9M in April.  The estate was only on the market for two weeks before going under contract.  The home was once owned by, ahem, Vanilla Ice.

That’s the whole scoop.

Happy 4th.  I hope you’re happy knowing that I’m sitting in front of a computer writing and calculating and verifying.  My job is real glamourous, eeh?

Related Reading:

• Miami Beach Luxury Real Estate: 2010 Waterfront Home Stats [SBCB]
• Luxury is Back [Pursuitist]
• Miami Beach Real Estate: Sunset Island Lots Sell for Near Record $22.5M UPDATED [SBCB]
• Miami Beach Luxury Real Estate: Waterfront Homes PPSF Falls 25% Y-O-Y [SBCB]
• Top 5 Miami Beach Trophy Properties For Sale [SBCB]

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$15M Miami Beach Penthouse

I liken Miami Beach to Manhattan or Beverly Hills.  Manhattan real estate operates on its own from the greater New York area, much the same way that Beverly Hills is its own little market inside the greater Los Angeles area.

I service South Beach and Miami Beach; the majority of my clients are NOT from here.  When they read a Case-Shiller report or news report from Diana Olick of CNBC that says X percent of X is X, and prices are falling and foreclosures are everywhere, I’m the one with the task to sort out the mess and misinformation.  Many of my clients have missed out on properties they wanted desperately to buy, but took the info that was produced en masse for the masses and made their decisions on that.

Just the other day, I had a conversation with a client, a very good client, who wanted to buy a unit at the Bath Club in Miami Beach.  It was a year ago today that we put in our offer for $900K.  My client would NOT go up.  The seller would have taken $1.1M.  It sold right after our offer for just over $1.2M.  It came back on the market about a month ago for, get this, $1.8M.  My client looked at me and said, “Kevin, you should have made me buy it!”

What can I do?  I knew it was a steal.  She knew it was a steal.  But when people smell blood, they want more.  The owner was in foreclosure, and conservatively, today, the property is worth about $1.550M.  Can’t beat those numbers with a stick, Diana!

But I digress. Let’s get to the TRUE picture of distressed real estate in Miami Beach (bank-owned and short sales) and show Case, Shiller and Olick a graph or two or three.

Distressed Real Estate in Miami-Dade County

The chart above represents all distressed properties in Miami-Dade County, including Miami Beach.  There are 10,219 homes for sale in a distressed state.  There are more than 1,100 of them selling per month, and about 2,300 properties are being pended per month.

Distressed Real Estate in Miami Beach

Now the true picture is revealed.  In ALL of Miami Beach, there are 700 distressed properties on the market for sale, with about 75 of those being sold per month.  Since our season ends in June, the dip in pended sales makes sense.

Distressed Miami Beach Real Estate over $500,000

If you break it down even further, approximately 100 of the 700 units in Miami Beach that are in a distressed state are
$500,000 and over—that’s like nothing.

Miami Beach Distressed Real Estate

• 3,121 active listings in Miami Beach
• 700 or 22.4 percent are in a distressed state (bank-owned or short sale)
• 600 of those units are under $500k

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Venetian Islands: Whaaa?

What really raised my eyebrow was the lack of sales on the Venetian Islands for the first half of the year.  During the first half of 2008, there were 15 sales on the Venetian Islands, and only four sales for the same time period this year, for a total of nine sales for Q3 2009.

Miami Beach Waterfront Sales Statistics for 1/1/2009-9/30/2009

Blech.  In Q3 there was a spectacularly low sale on North Bay Road.  I would classify this one as the ‘deal of the year.’

Looking forward to Q4 stats expect a few more sales on the Venetian Islands, one more shocker on North Bay Road; and a huge estate on Pinetree Drive that has been on the market for years and years (and mired in innuendo) finally closed last week.

Best Buys for Miami Beach Waterfront Estates

• 4766 North Bay Road, Miami Beach.  $4.4M.  Great lot, great views.  Owner paid $5.7M in 2006
• 303 E. Rivo Alto Drive, Rivo Alto Island, Miami Beach.  $1.990M.  Great buy on a cute little home.  Next waterfront home on the Venetians is $2.485M

Browse Miami Beach real estate

Move over Indian Creek Island,  there’s a new kid on the market and he means business.

11 Casuarina Concourse, owned by auto/real estate magnate Alan Potamkin was listed for $49,500,000. 

 As Paris Hilton would say: “That’s hot!”  This is one of the most fantastic pieces of property south of Palm Beach.

The main residence is over 20,000 sf, and is sited on over 3.6 acres of prime Gables Estates real estate.  The unique location of the property provides approximately 800 linear foot of waterfront.

The property is assessed by the county for $17,588,023*.  The current taxes on the property are $344,497,89.  From a 2006 Miami New Times article

Alan Potamkin, a high-profile developer from Coral Gables, paid a whopping $348,102 in property taxes in 2006. Potamkin’s kingly homestead has a current market value of $21 million, more than ten times what the auto/real estate magnate purchased the four-bedroom property for in 1987.

…hmmmm.

From the listing

“One-of-a-kind breathtaking 11B/8B open-bay waterfront estate is situated on the finest lot in gated, exclusive Gables Estates! This 20,088 sf grandeur home has 800 feet on water and sits on 3.6 acres. Private guest suite with lighted tennis court and courtyard on its own acre. 3 Suites w/full baths, upstairs master suite with full gym, billard, media room are just a few of the delights. Lutron lighting & 12 camera security system throughout this secure estate! A must see…”

I’ve heard that Alan Potamkin is really into his trees and landscaping.  I’m sure the landscaping is first-rate.

Related Reading

• Coral Gables Real Estate:  A Little Birdie Told Me… 

 *Assessment is used for tax purposes only.

*Listing courtesy of Avatar Real Estate Services 

Browse Miami Real Estate Here

Developing….

Browse Pricey Miami Real Estate

Here’s the problem I have with the media in this digital age. In the 25/7 rush to scoop each other on headline news, sometimes stories lack facts. Sometimes the “facts” presented aren’t entirely factual. And sometimes the interview is angled to fit the reporter’s notion of what the story is perceived or desired to be.

Don’t get me wrong. I have a lot of respect for the media in general and participate in many interviews myself. But like so many industries pressured by the ubiquity of Web information, and in the media’s case, significant declines in ad revenue, circulation, and staff resources, haste can make waste.

How did CBS make the already bad news about Jade on Brickell worse? 60 Minutes reporter Scott Pelley toured the downtown Miami condo with local broker Peter Zalewski and portrayed it as a victim of the subprime meltdown. False! This story line actually sounds better for Jade than the reality, but it disservices the truth.

The Real Story on Miami Condos

Anyone in Miami real estate since, say, 2004, knows that Jade’s problems are because of MORTGAGE FRAUD, overspeculation, and oversupply, NOT because of subprime lending. It is well known that Jade sold at the VERY top of the market. It is also common knowledge here that the majority of Jade’s contract-holders are speculators, though no one would EVER admit it.

Jade on Brickell started closing units in 2004-2005, WELL BEFORE any hint of financial fallout. The 60 Minutes segment further misses the point by leaving out important details. For example, when people buy preconstruction condo units, they do so WITHOUT a mortgage contingency.

Flipping Miami Condos

When Miami’s condo rush was in full swing, money was cheap and easy to get. Condo sales were not hooked to the mortgage market. Cheap mortgages and subprime loans were not used as an enticement. Zalewski commented that Option Arm and Alt-A loans were “essential” for Miami condo buyers. Not the case.

Back then, obtaining a mortgage was rarely discussed because most buyers planned to flip (remember that word?) their condo BEFORE closing. Bad CBS.

I can name many high-end buildings that are or were RAMPANT with mortgage fraud. Hello! Where’s the story on that??

Jade’s issues, I repeat, are NOT from subprime lending practices, and Zalewski should have known that and pointed it out. In the 60 Minutes segment, new condos in the downtown Miami/Brickell area seem to be portrayed as a hotbed of foreclosure activity (because of the subprime collapses). They are not.

I wish CBS had asked another broker or agent for the real story and the real center of foreclosure activity in South Florida real estate. But since they didn’t, I’ll help them out: Homestead, Florida. Working class Homestead, Florida.

Some of the more interesting (and hopefully more accurate) footage in the interview comes from Whitney Tilson, who tracks U.S. mortgage information. Here are the residential real estate loans coming up for readjustment:

• Sub Prime: $1 trillion. We seem to be near the end of these resets.
• Alt-As: $1 trillion.
• Option Arms: $500-600 billion.

Then there’s the commercial real estate market, but we won’t go there right now.

From the Credit Suisse graphs on CBS, it looks as if Alt A and Option Arm loan resets won’t peak until mid-2011. Yikes. These mortgage defaults could be more numerous and longer lasting than the subprime plunge.

Don’t you love the interview with the speculator who plays victim because she “didn’t ask enough questions” about her loan terms? Oh, okay. Sign six mortgages, but don’t read your contracts. This one gets the big “Duh!”

And did you see Oscar Munoz cleaning out ONE condo? He used to be a Miami real estate agent. Now banks hire his company to empty out foreclosed properties.

Peter: There really isn’t any way to spin “vulture.” You tried, though.

Chronicling the Miami-Miami Beach condo boom and bust:

• Condo Development on Miami Coast is Hot, Hotter, Hottest (The Miami Herald).
• They’ll Take Your Houses(New Times). The latter article is kind of ironic since the Tribune Co. just filed for bankruptcy.

This data is based on information from the  Southeast Florida Regional (SEFR) MLS or from the associations participating in the SEFR for the period of 1/1/2008-11/9/2008.

Miami Beach Real Estate

My last post on Miami Beach condo stats was on August 6th.  Between June 30th and November 11th the number of sales in each condo is as follows:

• Apogee South Beach-3
• Continuum South-5
• Continuum North-8
• ICON South Beach-14
• Murano-1
• Murano Grande-7
• Portofino Tower-3
• South Pointe Tower-2
• Yacht Club at Portofino-6

Miami Beach Condo Sellers:  Here’s your cup of coffee

Nothing really shocking here, but looking at the numbers from just over a year ago, inventory is hanging around much longer.  What most don’t realize is that the chart above is probably the most telling of all.  Here’s the rub:  condos don’t sell for whatever reason (I know what it is, but more on that later) and the inventory continues to back up.  Buyers see this as even more of a reason to either make “low ball” offers or wait on the sidelines.  Why?  Because real estate is primarily driven by the law of supply and demand.  Lots of supply/low demand:  prices fall.  A great anecdote is the price of gas over the last few months.  Demand eased, inventory backed up, and prices fell.

Generally, 10% of the building inventory could be for sale at any one time.  The average condo inventory for each of the nine buildings in South Beach-SoFi is 15.9%; which is up from 13.3% from 6/30/2008, or an EXTRA 55 units added to the normal amount of inventory already on the market.  Obviously, Continuum North and Apogee South Beach have added a lot of units to the market, but that is normal.  Their percentages will come down.

Here’s the fun one.  Six of the nine buildings have gone up in price ($ PSF) since the last market report.  Apogee surprises me, time and time again.  Apogee South Beach is #1 since it came on the market earlier this year.