💸 Ruthless Rental Reality

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Happy Saturday Highest & Best! Today we’re talking apartments and rent. Here’s the rundown:

🤼‍♂️ Miami is the nation’s “most competitive” rental market

🤔 Rentals for underpaid Miami lawyers

🌊 A wave of Miami super-sized apartment towers

Let’s get to it!:

Miami is the Nation’s Sharpest-Elbowed Rental Market

Renting an apartment in Miami requires a fair bit of jostling and pushing.

That’s according to a report this week that lists Miami-Dade County as the nation’s most competitive rental market:

😲 Nineteen prospective renters compete for every one vacant apartment in Miami, the highest anywhere in the U.S., according to the study by RentCafe.

📆 It takes an average of 36 days for a vacant unit in the Miami area to find a tenant — the shortest time frame in the country.

😲 Only 3.5% of Miami’s total rental units are actually available to apartment seekers, as more tenants stay put and renew their leases, the firm said.

📈 76% of Miami tenants choose to renew their leases instead of finding another place.

💥 Miami is going through a multifamily construction boom, but it’s unclear how much that will alleviate the rising costs of rentals at the current pace of in-migration by young professionals, at a time when home purchases are also becoming out of reach.

By the end of this year, 10,538 newly built apartments will be added to Miami’s rental market, according to commercial real estate data firm Yardi Matrix. That’s a 6.4 increase in new supply, based on the current housing stock.

Another 19,500 newly built units will come to market in 2025 and 2026 combined.

⏪ Catch up on recent Highest & Best issues:

• Going Full Floridian, June 22 2024

• Miami Mega-Loan Mania, June 14, 2024

• Foreclosure, Fines and Forklifts, June 7, 2024

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How to House Poorly Paid Miami Lawyers

Miami’s public defenders — and prosecutors— can’t afford to live in Miami.

About 156 lawyers left the Miami State Attorney’s office in the past two years. And the Miami-Dade public defender’s office lost nearly 60 lawyers in the same time period.

Their starting salary, as set by state law, is $68,000 annually — which is 14% less than the area median income for Miami, according to a report by Miami Today. And young lawyers carry an average of $160,000 in student debt.

Add to that: the median rent for a Miami one-bedroom apartment is $2,800, which works out to nearly half their salary going toward rent— should they find a place at that price.

So what can one do? If you’re a zoning commissioner in Miami-Dade County, you might try, strong-arming , ok, enticing a developer to give preference to public attorneys when renting out (a limited supply of) affordable housing.

In a meeting this month to consider approval of a new 39-story apartment tower, Miami zoning officials promised to greenlight the project —- IF the Chicago-based developer could guarantee that public-salaried attorneys would get first dibs on the future building’s 26 “workforce housing” apartments, priced below market.

The Chicago-based developer, Focus, readily agreed to the deal, and got unanimous approval for the 517-unit apartment project in the Brickell neighborhood, called Miami Starlite.

Turns out several commissioners on the zoning board were once public attorneys themselves, and knew the burdens of living in Miami on that salary, even before the pandemic’s mass migration sent rents to the stratosphere.

“I can tell you that those units will be rented in four hours,” said Commissioner Eileen Higgins, according to a report by Miami Today.

“We may be able, at least with this private-sector project, to plug the attrition drain on the experienced attorneys,” she said.

The building, at 128 SW 7th St., will rise on the site of a former motel. The tower is expected to be complete in 2028, according to the developer’s website.

More, More, and More Rentals Coming (Some Affordable)

It’s been a month of supersized apartment tower plans in Miami.

Developers, seizing on the apparent need for more (and possibly less expensive) rental housing, have unleashed a wave of high density proposals.

They’re taking advantage of Florida’s new Live Local Act, which allows builders to bypass certain zoning restrictions — like limits on a building’s height — so long as they designate 40% of their project’s units as “affordable” to people of certain income thresholds.

Here’s what’s proposed:

👋 Last Sears standing: A 1,050-unit rental project on the site of South Florida’s last Sears department store got the go-ahead this week from a Miami urban review board. The Miami project calls for 995 rental apartments, 55 rental townhouses, and 420 “affordable” units (which is exactly 40% of the building’s total). The development, spread out across three separate buildings, includes 1,070 bike storage spaces sand 1,924 parking spots. The developer is RK Centers, which is led by Miami Heat minority owner Raanan Katz.

😮 From 12 stories — to 48: A developer is proposing a 48-story tower in Miami’s Wynwood neighborhood— a place where building heights are capped at 12 stories by local law. The builder, Bazbaz Development, is seeking to erect a building that’s four times higher in exchange for designating 40% of the project’s 544 units as affordable, and priced slightly below market.

At least three other tall towers surpassing Wynwood’s 12-story height limits have been proposed, for a combined 1,730 new rentals to the neighborhood, the Miami Herald reported this week. They’re all seeking to invoke the new Live Local Act.

😮3,200 Rentals: In Miami’s West Little River neighborhood, a developer has submitted plans for a 3,233-unit mega project that calls for six apartment towers ranging from 26 stories to 37 stories, plus garages with 4,200 parking spaces. The project, dubbed alternately as Holland Park or HueHub in site plans, would be built on properties now occupied by single-story buildings. It would be the biggest Live Local project yet in Miami-Dade County, and would pretty much dwarf any other building in the largely single-family home neighborhood.

To qualify for such high scaling towers, 40% of the project’s apartments would have to be set aside for tenants who earn no more than 120 percent of the area median income, which today comes out to $95,400 for a single-person household.

That’s it for today!

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