- Live Local Act likely to stimulate affordable housing
development – Following last year's
implementation of Florida's Live Local Act, which aims to
increase the supply of affordable housing statewide, we expect to
see developers look to take advantage of the program's tax
credits and exemptions. More Live Local projects will likely move
forward in 2024, particularly in non-urban-core communities such as
Homestead, Kendall, West Broward, and Lake Worth.
- More investment in transit and infrastructure
– Amid the recent and ongoing expansions to Tri-Rail and
Brightline, areas outside South Florida's eastern urban core
markets are now attracting higher-density developments within
designated transit station zones. We expect that momentum to carry
over into the new year throughout Miami-Dade, Broward, and Palm
Beach counties, where local officials are generally supportive of
securing funding for transit and infrastructure projects as the
region's population continues to grow.
- Redevelopment opportunities for government-owned land
– Local governments throughout South Florida are
increasingly assessing the redevelopment opportunities for the land
they own to get the highest value and best use for the asset,
especially land west of the urban core. This has led to an uptick
in requests for proposal from local governments seeking developers
interested in redeveloping government-owned land through long-term
ground leases, which have become an attractive option for
developers and lenders given today's high-interest-rate
environment.
- Continued strength of condo financing market
– Despite the current lending environment,
high-quality condo and mixed-use projects with experienced
ownership in Florida generally have been able to attract new
construction financing. A case in point was last year's $430
million loan for an Auberge-branded redevelopment of the Shore Club
in Miami Beach -- one of the largest residential construction loans
in South Florida history. We expect several other large financings
over the coming months, indicative of the continued strength of the
local market.
- Growth of branded residences – The trend toward the development of branded residences and high-end condo projects continues throughout Florida, from Miami Beach and Coconut Grove to Pompano Beach, Jacksonville, Naples, Tampa, and West Palm Beach. High-end hospitality, food, and luxury brands like Aman, Ritz Carlton, St. Regis, Waldorf Astoria, Pendry, Dolce & Gabbana, Bentley Motors, Casa Tua, Major Food Groups, and Rosewood Residences are all planting flags in Florida, reflecting the demand for branded residences statewide. More world-class brands likely will follow suit and continue the trend of expanding to additional markets across the state.
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