Miami "condo king" hit by boom-to-bust downturn

Tue Mar 24, 2009 6:45pm EDT
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article | Single Page
[-] Text [+]

By Tom Brown

MIAMI (Reuters) - The once-booming real estate market that made Jorge Perez a billionaire is crumbling around Miami's "condo king" in what may be the biggest U.S. condo glut.

The chief executive of the privately held Related Group is South Florida's most prolific developer, a driving force behind a string of high-rises and mixed-use developments from Miami to West Palm Beach who championed the frenetic construction well after the market peaked in late 2005.

Today, Perez is trying to ride out a huge inventory buildup and falloff in property values across Florida, long on the frontlines of the U.S. housing and mortgage default crisis.

"I think he just kind of went overboard," said Lucas Lechuga, a Miami realtor and blogger.

About 45 percent of the nearly 23,000 condo units added to downtown Miami since 2003 remain unsold, said Peter Zalewski, whose Florida-based Condo Vultures Realty firm represents investors looking to buy large blocks of condos and rent them out until the market recovers enough to sell then at a profit.

He said many builders were having trouble paying down construction loans.

Perez's latest project, a gargantuan complex called Icon Brickell, consists of a boutique hotel and more than 1,640 luxury apartments packed into three gleaming towers on a spit of land where the Miami River meets Biscayne Bay.

It was supposed to be a crowning achievement after 30 years at the helm of Related for the man dubbed "Tropical Trump" after New York real estate mogul Donald Trump. But Icon Brickell opened as Florida was getting hit with a meltdown in its condo markets.   Continued...

<p>A woman runs in front of the Icon Brickell condo, billionaire Jorge Perez's latest project, in downtown Miami, Florida March 24, 2009. REUTERS/Carlos Barria</p>