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Miami Pre Construction with Airbnb or Short Term Rentals

by Gastón Laugé - November 23, 2022
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Miami Pre Construction with Airbnb or Short Term Rentals

We are going to discuss a branch of real estate investments that has had great success in Miami-Dade county, and that is properties with short term rentals and AirBnB capability.

As many know, this new way of renting apartments, where the owner works as if he was a hotel manager, has great advantages, even though there are also certain disadvantages.

The big advantages are being able to use the apartment every time you visit Miami, without worrying about the typical restrictions of a residential building where you can only rent it once or twice a year. At the same time, in certain cases, the profitability is higher than an annual rent, and the shorter the period of stay, the higher the price you can charge per night, especially in areas with a lot of tourism.

If we talk about the negative points of these properties with Airbnb, it could be that these buildings are not recommendable if one is staying for a longer term or to live in since these buildings don’t have the characteristics of tranquility and privacy that a residential building with an annual rent would have. There is also a little more wear and tear on these units and you also run the risk of not renting it on a constant basis, producing perhaps a low ROI…

But despite that, the advantages, such as the possibility of high profitability and the convenience of using your apartment in one of the most touristy areas of the world, never worrying about a hotel reservation and the increase in value these apartments have had recently, seem to be the major factors that have made these types of buildings a complete success.

In the following list, we will mention the opportunities that we have in the market and the traction that these buildings have had recently… We are going to focus on two areas that investors prefer and where the city has been friendly with the permits for Airbnb buildings…Downtown Miami and Brickell…

We won’t name the buildings that are condo hotels, because we don’t have the same flexibility as with AirBnb and they tend not to have a lot of profitability.

In Downtown Miami, thanks to the constant development of the new Miami World Center, the future train to Orlando, FTX Arena, museums, closeness to Brickell and the beaches, we have had a great success with the Legacy Miami World Center building, which launched in 2020, and is a mixed-use building with a hotel, convention center and a high-end medical center. The studios and super luxury apartments were sold in record time in the middle of the pandemic… and today, those apartments increased in value by 30% or more.

We also have Natiivo, which is currently the most advanced in construction from all the projects. Natiivo also has a hotel and apartments completely furnished from studios to 3 bedrooms with great city and partial water views.

Once the Natiivo sales ended, we continued with 501 First, one of my favorites, which offers better views than the previous projects due to its proximity to low-rise buildings such as Miami Dade College. It also has spectacular amenities on the top floors and with excellent prices per square foot… at the time we’re creating this article we also have 501 First inventory available since the developer recently released a few floors of the building that were not previously available for sale, and the construction is imminent in these weeks, the historic structure which stood there before has already been demolished.

Later came District 225, owned by the prestigious Related Group, in this case the building is located closer to the legal and administrative sector of Downtown Miami, and despite the fact that it did not have balconies, it was also a total success, and is currently under construction.

The next building with this modality was the Crosby Miami World Center, also owned by the Related Group, which launched in early 2022 and was sold in record time, with studios, 1 and 2 Bedroom apartments and amenities on the top floor just like 501 First.

In Brickell, for example, we have only had one opportunity for a luxury type of AirBnB called Lofty Residences, which currently has inventory of Penthouses and 1 bedroom units, in perhaps the best area of ​​Miami, next to Brickell City Centre with excellent views of the water and the city… this project is more expensive per square feet but it’s worth it for its location and great potential for profitability.

In 2022 we also had options in Wynwood, with Nomad Residences, which is backed by a great hotel company…the price per sq ft is high, but it is the only building with daily AirBnb in the entire area with no competition in sight, at least for the moment. In Wynwood we also have Diesel Residences, a building with great quality in its interiors and finishes, and despite the fact that it is not possible to rent out daily, it can be rented for a minimum of 30 days.

Also with 30 day rentals, we have The Standard Midtown, a hotel brand that is in style and the only project of this characteristic in Midtown Miami. A few blocks away, but in the Edgewater area, VIDA Edgewater, which will allow AirBnB for its larger units, but it is at a very premature stage in sales.

A building that stands out in the Downtown Miami area is Elser Hotel & Residences, which is on the verge of completion and despite the fact that we consider the prices a little excessive, it has by far the best views of the bay, the port and the sea than any of the previous mentioned projects.

We also have options such as Nexo North Miami which has been selling for a few months or recently launched Avenue in Coral Gables, although in both cases we are a little farther from the tourist centers of Miami.

Finally, in the past days we have launched the last great opportunity of pre-construction apartments with short term rentals, called 600 Miami World Center…

This building is from the same creators of 501, Yotel Pad (the pioneer in this type of building in Downtown) and many other high-end buildings in Miami. It has units from studios to 2 bedrooms, with many 1BD + den options, which we consider to be of better profitability because of the potential to be rented as a 2 bedroom unit but with a lower purchase price than an actual 2 bedroom. This project is currently under reservation stage and we consider it to be an excellent investment opportunity.

In all the mentioned projects, we only have valet parking, furnished and completely finished apartments, and available financing for up to 60 or 70% in certain cases, with the need to have a deposit of 30% once groundbreaking has occurred.

Another great advantage of pre-construction is that we can choose, or at least in the launch stage, the apartment that we like the most, and pay for it in installments throughout the construction of the project, while the value of the apartment, in many cases, continues to rise.

If you have any doubts or need to consult about the pre-construction market with short term rentals, we are here to help you. Please contact us for more information about prices, floor plans, and renderings, and subscribe to our YouTube channel.


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