Acquisitions of hotels and high-end residential real estate by foreign companies and wealthy individual investors from Canada, Latin America, Europe and Asia continue to be on the rise in Florida. In addition to perceiving real estate in the United States as a safe long-term investment and being enticed by the lower real estate prices compared to those in their home countries (together with favorable interest rates for deals that are not all-cash), international buyers are drawn to Florida’s lifestyle, top-tier ocean-front properties with sweeping water views, and ultra-luxury amenities.
South Florida, recently the poster child for the real estate bubble and crash, now is one of the strongest markets for exclusive ultra-high-end real estate investments, due largely to the influx of foreign cash. Some foreign buyers prefer existing developments, like Fisher Island in Miami Beach – an exclusive private island with luxury condominiums and villas accessible only by a ferry - because of privacy, a school located on the island, and a population of wealthy peers from their country of residence. Others are drawn to new construction projects and opt for full-service ocean-front condominiums in South Beach and Bal Harbour, favoring modern aesthetically-captivating designs, open floor plans, and high-tech gadgets. Developers, constantly competing for luxury real estate buyers, endeavor to make their projects very unique – through robotic systems that park cars next to an owner’s condominium unit, on-site restaurants with famous chefs, ocean-side golf courses, or high-tech home automation systems. Cultural aspects come into play as well – many developments have multilingual concierges and staff ready to assist with any request their international residents may have.
In addition to high-end residential real estate, South Florida commercial real estate market has also benefitted from investments by foreign buyers. In the last couple of years, commercial real estate in Florida, and particularly water-front hotels (boutique and full-service), have become international investors’ target trophy assets. With business travel and tourism having stimulated the local demand for hotel development, projects in the hospitality industry are among the hottest real estate targets of 2014-2015. According to the Emerging Trends in Real Estate 2014 report prepared by PwC and Urban Land Institute, Miami, fifth place last year, now ranks as the number one recommendation for the total hospitality sector by metro area. This has translated to foreign buyers looking beyond the “sand” at strategic locations that lie close to Fort Lauderdale or Miami (with the fastest growing airports in the United States), or Brickell Avenue’s City Center.
Foreign investment in Florida remains significant, and given the lower real estate prices, the lifestyle, and the variety of bells and whistles developers are integrating into properties to attract international buyers, it looks like the Sunshine State will remain a leader in attracting foreign money for the foreseeable future.