Douglas Elliman is expanding its new development rental division to South Florida as developers continue to bet on the hot multifamily market, The Real Deal has learned.
Elliman’s development marketing arm has been active in South Florida for years, handling sales and marketing of new condo projects that have included Faena House, Eighty Seven Park and One Park Grove. The New York-based brokerage is now expanding to new development rental leasing, which it conducts in New York, handling leasing of SL Green’s 7 Dey Street multifamily project and RXR Realty’s Magnolia Dumbo.
Elliman’s first leasing assignments in South Florida are Clara Homes’ Bay Harbor development and the rental component of Chetrit Group’s 6.2-acre mixed-use project in the Miami River district, according to a press release.
Clara Bay Harbor, which consists of three six-story apartment buildings with 150 units, will be developed in phases. The first 28-unit phase is expected to open next summer at 10281 West Bay Harbor Drive. Clara Homes is led by developer James Curnin.
Chetrit’s Miami River development is projected to include 1,800 apartment and condo units. The long-planned $1 billion mega development secured a $310 million construction loan in November.
Matthew Villetto, EVP of Elliman’s development marketing arm, said asking rents for both projects will be determined about 90 days before a building is completed.
Curnin of Clara Homes previously told TRD that monthly rents will likely range from at least $5 a square foot to $7 a square foot. At $5 a square foot, monthly rent for a 1,300-square-foot apartment, the smallest in Clara Bay Harbor’s floor plans, would go for at least $6,500.
Elliman plans to expand beyond Miami-Dade County into Fort Lauderdale and West Palm Beach, Villetto said.
Elliman isn’t the only residential brokerage looking to tap into the new development apartment market. Miami-based One Sotheby’s International Realty also plans to launch a rental division targeting new projects, according to a spokesperson.
Rising mortgage rates could be a boon for multifamily developers, as more renters are expected to continue renting rather than buying ahead of a looming recession. Dozens of apartment towers are planned throughout South Florida. Villetto expects developers will be able to set asking rents at prices higher than their initial projections.
South Florida rents and home prices have been rising for months, though the pace of that growth has been slowing. Rents grew about 46 percent annually in May, marking the largest hike nationwide, according to Realtor.com.
But wage growth has not kept pace with the higher cost of living. Miami became the least affordable U.S. housing market earlier this year and has remained in that top spot, according to RealtyHop.