News

Doral flips the script…

By Joseph A. Mann Jr., The Real Deal

Doral, hitherto best known for its gated communities and golf courses, has become the focus of intense development activity. Thousands of residential units are in the pipeline, and some market watchers are expressing optimism — albeit cautious optimism — about the city’s future.

“Doral is undergoing a renaissance of new mixed-use development that will change the face of the city and its skyline,” said Jack McCabe, the CEO of McCabe Research & Consulting. “The question is, how many will be finished? We’re boom and bust here.”

Doral was incorporated as a city in 2003. Since 2010, its population has soared nearly 30 percent, to an estimated 59,000, with a median household income above $70,000.

Now developers are betting that even more Floridians and foreigners would like to call Doral home. They’re planning to pour as much as $2 billion into residential and mixed-use projects, including offices, shops, restaurants, supermarkets, schools and parks.

“We are transforming Doral from a car-based, strip-mall culture to a mixed-use, walkable city,” a spokesperson for the City of Doral said. “This is the new urbanism, where people can live, work, shop and create, all on foot or bicycle.”

Codina Partners, a Coral Gables-based real estate investment firm, is developing the project Downtown Doral on land formerly occupied by aging mid-rise commercial buildings. Shovels broke ground about three years ago on the city’s largest mixed-use project. By the time it is completed, the construction of this new city within the city is expected to cost more than $1 billion.

Encompassing 120 acres, the master-planned community calls for 2,840 new residential units — including condos, townhouses and rental apartments — over 1 million square feet of office space and a Main Street with an outdoor shopping mall with 180,000 square feet of retail and restaurant space.

The first of eight planned condo towers, 5252 Paseo, was completed in early 2016. The 203-unit, 20-story building has sold out, primarily to buyers from Latin America who bought well in advance of the project’s completion. Pre-sales began in July 2016 for the 251 units in the 19-story tower at 5350 Park, where prices range from $200,000 to $700,000.

The developer’s partners on the Downtown Doral project include Lennar Commercial, which is participating in the Main Street retail component, and private investment groups advised by JPMorgan Chase. Codina and Lennar are also considering redeveloping part of the 130-acre Doral Great White Golf Course, potentially adding as many as 2,700 condos, townhouses, single-family homes and apartments.

Codina has been an active partner in the overall redevelopment of Doral, also building the Doral City Hall and an adjacent three-acre park with a public sculpture by Michele Oka Doner, a native Floridian.

The Related Group and Shoma Homes  have also gotten in on the action in Doral, developing an $800 million, 55-acre mixed-use project called CityPlace Doral that is scheduled for completion by the end of 2016. The development calls for 250,000 square feet of retail space and more than 1,000 housing units, including 150 single-family homes, 700 rental apartments and 320 condos. The central section will include a pedestrian mall and a Vegas-style fountain.

The developers say they’ve already signed up retail tenants such as Fresh Market, CineBistro-Cobb Theatre and Kings bowling. Related owns a similar mixed-use development, CityPlace West Palm Beach.

“Unfortunately, Doral didn’t have many good residential areas,” said Masoud Shojaee, chairman and president of Shoma Group. He said they had designed CityPlace with a mix of residential and retail because “we want to keep people here.”

Nearby, Century Homebuilders is developing the Midtown Doral complex. Plans include more than 1,500 condos in residential towers with fitness centers, outdoor areas for family gatherings and commercial space. An outdoor shopping center called The Shops at Midtown Doral is planned to include an open-air amphitheater with two stages.

“Doral has a huge daytime population and a lot of people want to live here,” Sergio Pino, founder and CEO of Century Homebuilders said. “Midtown Doral will have all the things that people want in their neighborhoods: restaurants, gyms, coffee shops, doctors and other professional offices.”

Uncertain outlook
Prices are lower here than in trendy neighborhoods to the east, like Brickell or Miami Beach, which has helped to attract condo buyers from South American countries such as Venezuela.

Yet sales became sluggish in mid-2016. “Summer was slower, which I think is normal,” said Ana Codina Barlick, CEO of Codina Partners. “We’re waiting to see if it’s a seasonal effect, or a sign of a slowdown. We’re very bullish on Doral.”

Other developers say they’re remaining flexible, and will delay construction if the market conditions warrant it.

Peter Zalewski, a real estate consultant and the founder of Condo Vultures, views Doral as a value proposition. “It’s in the heart of a booming local economy, with a nice lifestyle and strong source of jobs.” He said he’s bullish on Doral in the long term — but not in the short term. “Developers will need to discount if they want to keep sales moving.”

Zalewski pointed to figures on Doral resales, showing that completed condo sales in the first half of 2006 were on the market for 48.9 days. In the first half of 2016, that figure was 125.8 days. The average price per unit for the same period in 2006 was $289,455, compared with $210,316 in 2016.

“Developers are getting a little ahead of themselves,” he said, “like they usually do.”