Return of the Bubble Markets: Supply Heats Up in Florida | Katonah NY Real Estate

The recent strategic partnership between AREA Property Partners and CC Residential to develop multifamily communities (with two 350-unit projects underway) in South Florida continues to shine the spotlight on this once overbuilt region.

In the past couple of months, once-challenged developers like Miami-based The Related Cos. and Boca Raton, Fla.-based The Altman Companies put out press releases touting their presence in Florida. That’s quite the departure from a few years ago when it felt like these companies wanted to get as far away as possible from their new product in the Sunshine State.

A couple of weeks ago, Altman announced four new developments—in Boynton Beach, Coconut Creek, Kendall and Pembroke Pines—that will add an additional 1,110 units to the South Florida inventory of rental apartments. The company’s Altis brand are three-story walk-ups with no breezeways that will have private entries. Thirty percent of the units will have attached, direct access garages. The company, which says it will stick with apartments this cycle, has also identified Tampa and Austin, Texas for new apartment development starts in 2013.

Another long-time Florida name, Related, put out a release in the beginning of May, announcing eight new projects, totaling around 4,000 units, which the company claims would make it the biggest developer in the state. The builder says it has an additional 12 sites set aside for condo projects.

Other companies based outside of Florida, like Atlanta-based Wood Partners and McLean, Va.,-based JAG are also active in the market. It’s easy to see why, with occupancies at 96.7 percent overall and between 92 to 99 percent in many B and C complexes in the three South Florida counties tracked by Jack McCabe, chief executive of McCabe Research & Consulting in Deerfield Beach, Fla.

“I think there’s a strong belief by developers, and I share it right now, that Florida will be a booming market for rentals in the future,” McCabe says.

Florida’s booms often end in busts a few years later. No one is confident that won’t be the ending again. But for the next couple of years, at least, demand should remain strong.

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