Focusing on such topics as luxury retail, undervalued neighborhoods and local prospects for “linear parks,” industry leaders gathered in downtown Miami on Wednesday to discuss the state of South Florida’s real estate market.
The city’s cultural transformation and its ability to draw wealth from the U.S. and abroad have made it an attractive target for developers, speakers at the University of Miami Real Estate Impact Conference agreed.
“This is now a world-class, international gateway city,” said Ian Schrager, a developer who was behind the boutique Miami Beach Edition hotel, which opened last December.
As a result, Miami’s luxury market has thrived.
“Miami is now the third-biggest market after New York and L.A. for luxury retail,” said David Forbes, a partner at the Forbes Company, a high-end shopping center developer.
But that means commercial rents for retail have also skyrocketed, doubling over the past six years, according to Robert Cohen, an executive at the real estate broker RKF.
“Sustainability is a big word and we’ll see what happens in the next cycle,” Cohen said.
And another cycle is inevitable, said Richard LeFrak, the New York-based developer who now owns 183 empty acres, formerly a landfill, at Biscayne Landing in North Miami.
“There will be some volatility in the market even if people are buying condos and putting 50 percent down,” said LeFrak, the event’s keynote speaker.
But LeFrak, who bought the Biscayne site during the last financial crisis, said volatility leads to new opportunities for developers to invest and keep building out Miami’s growing urban core.
“People will look back at this time as a transformational period for this city,” he said.
As prices flare up in Miami’s downtown, developers are turning to new neighborhoods. The consensus favorite among conference speakers for new development seemed to be the Biscayne Boulevard corridor.
“It has frontage on the bay, it’s close to the beach, there’s a major north-south road, and it’s an area with empty land,” LeFrak said. “It’s the next ring of development after downtown and the Beach.”
One of Miami’s newly developing neighborhoods, Wynwood, may not be ready for high-end projects yet, said Schrager. “Wynwood reminds me of Williamsburg [in Brooklyn],” he said. “I think it is not safe at night there yet, but it’s cool. I’m keeping my eye on it.”
The conference, which was at the JW Marquis Marriott Miami, also hosted a panel on local efforts to create public green spaces, or “linear parks,” along existing trails in Miami-Dade.
One such proposed project, called the Underline, would create 10 miles of bicycle and pedestrian paths on unused space under the Metrorail line that runs from Dadeland to Brickell Station.
“We want to find ways to take these leftover lands and give them back to the public in meaningful ways,” said Meg Daly, who is spearheading the effort through a group called Friends of the Underline. She cited the High Line, an elevated walkway in Manhattan that replaced an unused railway spur and drew new investment to a barren part of the city, as an inspiration.
Daly also said the project could reduce car accidents involving pedestrians and bicyclists.
Similar proposals include converting six miles of abandoned railway line between Dadeland and Miami International Airport — the Ludlam Corridor — into a walkable trail studded with parks and mixed-used developments.
Speakers also agreed that the county needs to make a serious investment in public transportation and existing roadways if Miami wants to compete with other international cities. Otherwise, traffic will continue to gum up the city’s development as more people move into a confined space, LeFrak argued.
“You don’t have the luxury or the geography of letting the city spread because you’re bounded on the west by nature,” he said.