A developer is converting a two-year-old Miami apartment building into condos, pitching the project as attainable housing in a city replete with luxury towers.
Gamla Cedron Group is launching sales at the eight-story Centralis Residences Miami at 1110 NW First St. The 100 units are priced from the $300,000s to nearly $500,000.
The building is in the heart of the city near downtown. It's within walking distance of LoanDepot Park, home to the MLB Florida Marlins, and less than a mile from the city's Health District.
Douglas Elliman's Solis Chirino Group, led by Miguel Solis and Mario Chirino, is the exclusive sales agent for the project.
"The key is affordability," Chirino told Homes.com. "It's a chance for people to be centrally located in Miami, and they don't have to drive an hour to get to work."
The conversion is also appealing because buyers don't have to worry about Florida's new condo safety law, he noted. Legislators enacted the measure following the collapse of the 12-story Champlain Towers South in Surfside, Florida, in 2021.
The legislation requires associations in older buildings to complete inspections and finance reserves for repairs, potentially pricing out some existing residents. But the law doesn't apply to newer construction.
Condo conversions not new
During the late 1990s and early 2000s, developers converted apartment buildings to condos across the country to capitalize on demand for new homes. In South Florida and other destination markets, some buildings sold in days as investors clamored to buy units and resell them for big profits.
That led to a nationwide surge in home prices and a bubble that burst in 2006, ushering in the Great Recession and the worst housing downturn since the Great Depression.
Once the market collapsed, individual units and entire buildings fell into foreclosure, and the condo conversion craze largely ended.
But conversions, such as this one happening in Atlanta, could be on the comeback, analysts say.
Rising costs in older buildings make new condos more attractive, but the vast majority of new condos under construction in Miami-Dade County are priced close to or more than $1 million.
What's more, liability insurance was a big problem during the early 2000s, and many developers and lenders prefer to avoid new construction for that reason, according to James Young, an associate finance professor at the University of Oklahoma.
HOA dues relatively modest
Affordable units with a lower total cost of occupancy will become more attractive to residents who want to leave their older condo buildings and not go into the rental market, Young noted.
"It just makes sense in a lot of ways to do these conversions," he said in an interview.
The one- and two-bedroom units at Centralis Residences Miami range from about 600 to more than 1,000 square feet.
The building comes with a pool, a social club and a gym, but it does not have other amenities that tend to drive up association fees, Chirino said.
Monthly dues for a one-bedroom unit would be up to about $600, while dues for a two-bedroom unit would top out near $900, according to Chirino. Centralis Residences Miami has fully funded reserves, he said.