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Miami and its Archistars
Park Central Hotel (Miami Beach)
There is more to the city in Florida, USA than blue skies and white beaches
March 30, 2016: Miami is one of the most exciting cities in the world. The favourable climate, with blue skies and white beaches, is one of the things that helped the city move on from the financial crisis. And in the past few years, the city has been experiencing an important and steady growth in all sectors.
Aside from its strategic geographical location as the gateway and the financial capital of South America, several other important factors contribute to the fundamental strength, the expansion and the momentum that are helping Miami overtake other main cities in the United States, such as New York and Los Angeles.
First, the city shows the highest concentration of international banks within the United States and the number of investment funds is constantly increasing. Demographics are also very positive and show growing figures, as a consequence of the internal migration from other US cities, due to the high quality of life and a favourable tax system.
In Florida, there are no state income taxes. You will be required to pay only the federal taxes, saving about 13% annually. This is pushing a high number of High Net Worth Individuals to shift to Miami. Their presence enhances the attractiveness of the city also from a cultural point of view because many of these billionaires have been investing a lot in museums, art exhibitions, sport events, public venues and local infrastructure.
Miami is one of the main touristic destinations in the world, with 15 million visitors per year, 50% of these coming from foreign countries. The market is not seasonal anymore; visitors come all over the year because of business, international congress and art exhibitions. This has positively influenced the hotel market and Miami is now ranking second in terms of Average Daily Rate (+7.6%) right after New York, ahead of San Francisco, Ohau Island (Hawaii) and Boston, and fourth in terms of occupancy, after Ohau Island (Hawaii), San Francisco and New York. (Source CBRE H1 2015)
Top 5 US hotel markets
Source: CBRE, Miami, Hotel MarketView, H1 2015
The city will also benefit from investments in the infrastructural sector, among others to enlarging the port to facilitate the entry of boats coming from the Panama channel and construction of a passenger railway that will connect the city to Orlando.
Most of the visitors (96%) to Miami arrive by plane. Miami International Airport was recently renovated at a cost of $6.5 billion. It is featured in the Top 10 airports of the US in terms of passengers. Furthermore, direct flights to Asia will be added soon, opening Florida to a new booming market.
Miami is also the most international city in the United States, as 51% of its population was born in a foreign country, and counts 75 foreign consulates. 90% of the investors in the real estate market have foreign origins. The residential market is nowadays much more stable and healthy, compared to the period before the financial crisis, thanks to the restrictions applied by the lending institutions, to a high level of liquidity in the market and to the new deposit system, which requires buyers to put down 40%-50% of the purchase price as deposit at the time of signing the contract. In the past, only 10% was required.
The boom in the real estate market has attracted well-known architects, who are redesigning the skyline of the city, contributing to its cultural growth. The big names in the world of architecture and design (Herzog & de Meuron, Frank Gehry, Norman Foster, Zaha Hadid, Renzo Piano, Lissoni, Enrique Norten) have either already realised or are realising at least one project in Miami. Their presence has pushed residential prices to very high levels.
Among the most important projects are Jade Signature (Sunny Isle Beach), by Herzog & de Meuron (the firm that realized the Pérez Art Museum Miami), whose units sell for $1,400/SF; Faena House (Miami Beach) by Norman Foster, where prices are in the range of $3,000/SF; 1000 Museum (Miami Downtown) by Zaha Hadid, with average prices of $1,300/SF; 321 Ocean Drive (Miami Beach) by Enrique Norton, whose units sell for $1,500/SF; and Baltimora Terrace (Miami Beach) by Renzo Piano, with average prices of $2,000/SF.
3D development pipeline in downtown Miami
Source: Miami Downtown Development Authority, 2015
The combination of the above-mentioned factors has triggered growth in Miami, both from a cultural and an economic point of view, and has transformed it into a luxury and sought-after city, much more sophisticated than in the past. It is not a coincidence that it has been recently defined as “America’s City of the Future” by the well-known magazine The Departure and its stature is expected to grow further.
The swift growth of the market has made some local architect firms famous worldwide. Among these are Arquitectonica (the firm that projected Brickell CityCenter, the biggest mixed-use development project currently under construction in Miami) founded by Bernardo Fort-Brescia, and Shulman+Associates (who took care of the renovation of Lincoln Theater on Lincoln Road, Miami Beach and the Soho Beach House) led by Allan Shulman. Both firms are working on three out of the four projects that Optimum Asset Management S.A. is executing in Miami, through its affiliate Optimum Development USA LLC, awarded Fastest Growing Real Estate Development Company in the US by International Finance Magazine in 2015.
Optimum Asset Management S.A. is a Luxembourg based Asset Management Company with specialisation in the Private Equity sector and a strong focus and vocation on Real Estate, active in several markets, among others Miami, New York, San Francisco and Los Angeles.
Arquitectonica has been engaged by Optimum Asset Management S.A. for a residential boutique tower in North Beach (Miami Beach), in collaboration with the well-known interior design firm Lissoni Associati (Milan), and a modern office building in the prestigious district of Coconut Grove (Miami). Shulman+Associates is working on development and renovation of one of the Art Deco buildings in the shopping district of Collins Avenue, Miami Beach.
Arquitectonica project for Optimum Asset Management S.A. in Miami Beach
Shulman + Associates project for Optimum Asset Management S.A. in Miami Beach
Optimum Asset Management S.A. is also renovating the Park Central Hotel, one of the most iconic hotels on Ocean Drive, Miami Beach. This project, realized by the New York architect firm Space4Architecture and led by the fourth-generation architect Michele Busiri-Vici, includes also the construction of a modern all-suite building on the last buildable lot on Ocean Drive.
Park Central Hotel (Miami Beach)
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