A development firm is building two waterfront houses on speculation in South Florida and expects to list both properties for a total of about $60 million in a sign of confidence in the luxury housing despite economic uncertainty.
The estates at 9540 Bay Drive and 600 88th St. are under construction in the city of Surfside, north of Miami Beach. The 88th Street home is due to be completed in the fall, and the other property will be ready in about a year, according to Kort Development of Sunny Isles Beach, Florida.
The upper end of the housing market appears resilient, industry observers say, and buyers of high-end homes often pay cash. Still, so-called spec building, or starting construction without a buyer in place, carries risk, especially now with a looming economic recession, according to Jack McCabe, a U.S. housing analyst with McCabe Research & Consulting.
"It's unusual for someone to be so optimistic about going ahead with such expensive properties at this time," McCabe said in an interview.
But spec developers Amit Kort and his son Tomer said they have no concerns about moving forward because they are targeting well-heeled, cash buyers who own recession-proof businesses. The properties are across Biscayne Bay from Indian Creek Island, where Amazon founder Jeff Bezos recently bought three parcels and NFL legend Tom Brady is getting offers of $150 million for his new unlisted mansion, Tomer Kort said in an interview.
"We are going after the 1% of the 1%," he said.
Bayfront lot
The 88th Street property will be nearly 10,000 square feet on a corner lot with 75 feet of bay frontage, according to Tomer Kort. It will have high-end finishes, a seawall and dock and likely list in the $25 million to $29 million range, he said.
The Bay Drive home, a double lot with 125 feet of bay frontage, will likely list in the low $30 million range, Kort said. It also will come with high-end finishes, a seawall and dock and include nearly 13,800 square feet of living space.
Tomer Kort is the listing agent for both properties through The Brokerage South Florida Real Estate firm.
Vaster, a Miami-based private lender, provided $25 million in financing for both properties.
"People are still confident in South Florida, and not only people in the U.S., but people all over the world," said George Fraguio, Vaster's vice president of bridge lending, in an interview.
Surfside is a town of about 5,500 residents that made national headlines in 2021 when the 12-story Champlain Towers South condo collapsed. The disaster killed 98 people, but federal investigators delayed a report on the causes of the collapse until 2026.