Condos a popular part of Florida commercial real estate market

Condos a popular part of Florida commercial real estate market

Condos continue to be a popular investment in South Florida, with buyers having paid nearly $2 billion on fewer than 1,750 brand new units on the east side of Interstate 95 during the past few years. The condos recently completed in the Palm Beach, Broward and Miami-Dade County areas' commercial real estate markets have been purchased for more than a million dollars per unit. Individual deals ranged from under $150,000 to almost $18 million.

It appears that foreign investors are heavily participating in the transactions involving new condos. Back in 2011, investors from throughout the world were interested in South Florida for several reasons. These included increasing rental rates that landlords were being paid, high exchange ranges for foreign currency against the U.S. dollar and low prices for real estate.

Following the real estate crash in the southern part of the state, developers tried to capitalize on the above-mentioned trends by requiring buyers to prepay half of the contracted condo unit purchase price before the projects had been completed. This gave developers the funds needed to construct the units and also decreased their risk when dealing with buyers. Thousands of additional units are slated to be built in the three South Florida counties.

Developers and investors may understandably wish to take advantage of South Florida's growing condo market. However, it can be tricky to navigate a commercial real estate deal. An applied knowledge of the law may help people to successfully complete their deals and thus achieve their real estate goals in the Sunshine State.

Source: Miami Herald, "Buyers spend $1.9 billion on new South Florida condos during this cycle", Peter Zalewski, May 31, 2015