Co-living has proven to be a success around the world. But will Miami residents really embrace the concept of rent-by-bedroom in order to live in the booming downtown district?
Developer Property Markets Group (PMG), the developer of high-end projects such as the 50-story Muse tower in Sunny Isles Beach and the 57-story luxury Echo condominium in Brickell, is betting big that they will.
The company breaks ground Tuesday on their newest communal living tower, a 49-story, 714-unit rental apartment building at 400 Biscayne Blvd. that will replicate the rent-by-bedroom model of X Miami, the apartment building at 230 NE Fourth Street that features 80 “co-living units.”
The project is a joint venture between PMG and the Toronto-based Greybrook Realty Partners asset management firm. The two companies plan to develop more than 25,000 units around the U.S. over the next five years.
“We obviously believe in the co-living concept,” said Ryan Shear, a manager partner at PMG who oversees the firm’s projects across the U.S. “The world is becoming more expensive and people are getting priced out of cities. Everyone in the industry is starting to consider the co-living concept because it’s a disruptor. I believe that in 10 years, it will be as common as co-working spaces are now.”
Co-living buildings allow tenants to share the living and kitchen areas of the furnished apartments and take advantage of amenities usually available only to luxury properties, such as an open-air pool deck overlooking the downtown landscape.
The rents aren’t cheap — the current asking prices for a private bedroom/bath at X Miami range from $1,370 to $1,890 — but Shear said the building is close to 90 percent fully-leased.
Shear said the 400 Biscayne building will feature amenities geared to attract a variety of ages to combat the stigma that co-living is only for people in their 20s and early 30s.
The tower will also incorporate a new 25,000-square-foot space spanning the bottom ten floors for First United Methodist Church of Miami, which had previously occupied the property. The church will have its own separate entrance and parking and will include a chapel, a fellowship hall, classrooms and offices.
PMG bought the one-acre site in 2018 for $55 million from the church.
Another PMG co-living tower, the 650-unit, 41-story X Las Olas in Fort Lauderdale, is scheduled for completion in 2020. The company plans to rebrand its future co-living towers to attract a wider demographic than just millennials, although the new name has not been finalized.
PMG has also acquired a parcel of land in Wynwood, where it plans to build another co-living tower. The company declined to disclose the exact location of the property until the sale closes.
Last week, the London-based developer The Collective announced it will bring a 325,000-square-foot, $210 million mixed-use co-living space to Wynwood.
Co-living continues to gain traction in big cities around the world as a solution to steep housing costs for people starting their careers in dense urban hubs. According to the World Economic Forum, co-living was one of the big topics of discussion at the 2019 MIPIM market conference in Cannes, an annual gathering of international property owners and developers.
Although X Miami is the only location in the city that currently offers co-living, the concept is prevalent in other cities around the U.S. with dense populations and high housing costs, such as Chicago, San Francisco and New York.
The website coliving.com, which allows users to search for co-living locations around the world, shows the housing is particular popular in countries such as Japan, China, South Korea and the U.K.
The 400 Biscayne PMG building will also house the 20,000-square-foot sales center for another PMG project: The Waldorf Astoria Hotel and Residences Miami, which will be built on the adjacent lot at 300 Biscayne Blvd. That building will take a minimum of three-and-a-half years to build, Shear said. The sales center will be completed by the end of 2019.
Shear acknowledges the rent-by-bedroom concept is still new to Miami and admits some developers are skeptical.
“Compared to most major cities, Miami is a statistical outlier when it comes to delivering rental units,” Shear said. “We are super light on the amount of multi-family units available. We can’t be a condo city forever. And although micro-units are popular now, I always ask myself ‘Would you rather live in a 250-square-foot by yourself or in a 1,400-square-foot space with your own bedroom?’ It’s too soon to tell. We obviously believe in the concept.”