A few miles away from the resort-like atmosphere and pace of South Beach, is Miami’s thriving greater downtown scene. The area, which already hosts the largest concentration of international banks in the United States, as well as many large national and global companies, is experiencing an unprecedented boom, both in terms of the variety and the scale of real estate projects being carried out. As it stands today, Miami is reported to have the 3rd highest number of skyscrapers in the US, after New York City and Chicago, and yet more vertical structures are on their way.
Someone who is well versed in the new spike in demand for real estate in downtown Miami is Commissioner of District 2, Marc Sarnoff who notes, “The investors we are seeing in this building cycle are somewhat different from those of the previous cycle, which were already a good crop. What we are seeing today is much closer attention to architectural design as well as to the environmental impact of projects, and more iconic structures. Overall, this building cycle is more sustainable than the one before because this time we are not dealing with banks’ money, but instead people are putting down their own money, and that clearly reduces the likelihood of them walking away from their own investments.” Besides being the city’s District 2Commissioner, Sarnoff is also Chairman of Miami Downtown Development Authority (DDA). As such he has been a strong advocate of enhancing the area’s overall quality of place, through a number of initiatives aimed at relaunching neglected and unproductive urban areas, protecting the environment through stricter green policies, managing the city’s water resources more effectively, and overall, nurturing the creation of a more appealing downtown ecosystem. In his on-going personal quest to endow the city centre with a higher and richer quality of life, he feels that a lot has been achieved already, “In 2010 Miami was ranked as one of the world’s top 3 cities alongside London and Moscow, by the International Journal for Investment, so I would say we are already in the top league. Plus, we are still a bargain. Miami is definitely one of the most competitive places on earth in terms of value for money.”
Alyce Robertson, the Executive Director of the DDA, corroborates his statement, “We are a very young city by comparison with most other cities around the world and in many ways we can claim we have not yet been discovered. As Miami Downtown Development Authority our job is to get the message out that our city is not just about sun and fun; this is a place where you can have a full business schedule, as well as immerse yourself in the arts and culture, enjoy our beaches, and a lot more. We are a highly diversified product and destination, that can please all palates, up to the most demanding.” Robertson explains that the DDA operates within the boundaries of approximately two square miles and, while today downtown is home to a population of around 80,000 people, it has doubled in number over the past decade.
Francisco Garcia, Director of the Department of Planning and Zoning for the City of Miami, outlines what he calls the “wholesale reorganisation of the region’s population”. He explains that over the years the South Florida market has been developing in a very suburban fashion, giving birth to a number of very upscale, luxurious single-family residential clusters away from urban centres. “What is happening now is that people are beginning to coalesce around the urban core and as they experience an increasingly more taxing commute, they will start considering moving closer to our downtown area, especially given the high-quality products that are being delivered and will continue to be delivered to the market going forward”. He explains that the density plan for Miami’s urban core is currently around 1000 units per acre, somewhere close to the density of Hong Kong and Tokyo. “We are going to give people who now live 20 or 30 miles away the opportunity to move increasingly closer to their place of work and live in an environment that ensures them a level of convenience, safety, beauty of place – a quality of life – that is hard to match elsewhere,” explains Garcia. In his widely shared opinion, this will ultimately give shape to a city with year-round business, as opposed to just seasonal business as it has been so far. “We are becoming a 12-month a year city, which speaks to the sustainability of our plan. The fact that more and more foreign investment is coming to our city is a good indicator that the level of our infrastructure is significantly going up in quality.”
Currently, 75% of Miami is zoned as single family residential, which equals approximately nine units per acre. Garcia describes such numbers as anachronistic and, consequently, unsustainable in the long-term, “I personally see no end to the increasing pace and quality of urban development in Miami; with the upgrading of our seaport and airport, not to mention our roadway and freeway system, we are inevitably set to become one of the next great cities of the world. The idea behind Miami 21 – a vision of how the Miami of the future will be, based on the adoption of a holistic approach to urban planning and the use of our land – is to get people out of their car and start relying on public transportation. To give you an example, a project called CENTRO was just approved, featuring 352 condos and just four parking spaces, one of which is for disabled people. At our current pace of growth, traffic is a problem that must be taken very seriously. We are moving into a phase where you will no longer be able to park your car. People will have the option of either using public transportation in the downtown area or relying on automated parking systems.”
Miami 21 identifies six elements as pivotal to transforming the city into a unique place to “live, work and play” – namely, zoning, economic development, historic preservation, parks and open spaces, arts and culture, and transportation.
The revitalisation process of greater downtown Miami is led by Brickell City Center, a mixed-use development project embracing four blocks from west of Brickell Avenue to the south of the Miami River, and Miami World Centre, a 10-block site situated in Park West neighbourhood, just north of the city’s Central Business District. The former is being developed by Hong Kong-based Swire Group, and is currently well into its first development phase, and the latter by Miami World Center Associates, which is expected to break ground this year.
North Carolina-born Stephen Owens, President of Swire Properties, arrived in Miami in 1979, after spending two years in Hong Kong at the company’s headquarters. Talking about Brickell City Center, he is quick to counter misunderstandings to highlight the bigger picture, “It is the largest private-sector project currently under construction in the US. I believe that the stimulus, the inertia, and the energy generated by this project will act as a potent boost of confidence for our community and provide an accurate perception of where Miami is heading.”
As evidence of their commitment to creating a high-quality urban space, as opposed to merely pursuing profit, Owens points that “Only 73% of what we are entitled to build is actually being built. Sustainability – and how we affect the communities in which we operate – is a cornerstone of every project Swire does. I want to underline that this is not something that is mandated by the government, for we take the same approach in China or anywhere else we go. We have also taken extra steps to create greenways. In fact, when we started this was the first pre-certified LEED neighborhood project in North America.”
Owens quantifies the company’s financial commitment for the first phase of the project as being approximately $1.2bn, going up to around $2bn with its second phase, scheduled for 2019. “We have 1,700 construction workers operating 24 hours a day and we are putting a floor on each tower every four days, which is a terrific pace”, he underlines. Given the scale of such a project, what is Swire’s biggest challenge? “With all the development that is going on in Miami costs have gone up by 20% in the last 12 months, a figure that is clearly unsustainable,” says Owens. He believes however that that is going to have a positive effect on the market, as it will keep the number of new developments to more rational and manageable levels. “The staggering numbers that are circulating with regards to pre-sales figures, around 70% in some cases, are simply not realistic. If all the new condominiums that have been proposed were to actually break ground, the market would simply be unable to absorb them.” As is often the case, the reality of what is announced and what eventually goes up are two very different things.