Measures to contain the spread of the coronavirus continue to shift — and so do responses by investors, developers, builders, banks and buyers. To track the impact, RE|source Miami is asking area real estate professionals in various sectors for on-the-ground reports.
Today we hear from Joe Furst, founder and managing principal of the development and private equity firm Place Properties in Wynwood. Furst worked for a decade at the real estate development and management firm Goldman Properties. He drew up-and-coming retailers and restaurants to Wynwood in the mid-2010s and partnered with the development firm Sterling Bay to create 545Wyn, a 325,000-square-foot mixed-use project with office, retail and restaurant space.
He’s also signing tenants for Doral Yard, a 20,000-square-foot community hub in downtown Doral. Already committed are della bowls, Paletas Morelia, Pokekai and Santo Dulce.
Q: How has the pandemic influenced leasing activity for commercial real estate in South Florida?
The pandemic put a pause on leasing activity for many sectors of commercial real estate. Most of the deals that were underway pre-COVID, still plan to move forward, but have moved much slower than typical.
There are two great opportunities, post COVID, for Florida: First, the population growth that I’ve seen in each of three markets in which I focus — Miami, St. Petersburg and West Palm Beach — has been explosive over the last three months. The value proposition of living in highly dense urban areas has clearly decreased and warm weather climates with more outdoor recreation activities are in strong demand. Second, the demand for industrial space and last-mile distribution centers is at an all-time high as various distribution and logistics companies expand delivery services.
Q: What type of industries are strong enough to expand their office foot print, and why?
I believe COVID will accelerate the relocation and expansion of many industries, but particularly technology, to South Florida. The clear proliferation of the virtual workplace provides enhanced opportunities for companies to spread their labor force to more desirable lifestyle markets such as Florida, where we’re already seeing an increase of new Class A developments in widening office markets such as Wynwood. We are set to open our new office project with Sterling Bay, 545Wyn, this summer.
Q: What type of retailers are performing better than others in South Florida, and why?
I’ve been deeply impressed by many of the local retailers who have managed to iterate their business to meet the unique demands of COVID. Zak the Baker, All Day and Alter, all three which I know intimately well, converted their sales channels to specialty food delivery as well as give-back programs to help with restaurant employee relief. Not only were their product offerings unique and high quality, but they did what they could to ease the financial pain of many individuals in their industry.
Q: You helped bring unique tenants to Wynwood. Who are you excited to bring to the neighborhood now and why?
Unfortunately, there is no doubt that some retailers and restaurateurs are not going to survive the temporary closures and decrease in tourism that resulted from COVID. The silver lining is that there will be a new crop of entrepreneurs who find opportunities in markets which didn’t previously exist due to various barriers to entry, including but not limited to price point, supply or the economic hurdle of first-generation restaurant space.
Q: How did the pandemic influence the opening and progress of the Doral Yard?
We were set to open the Doral Yard in March. Obviously, we delayed the opening of the Yard until the fall. The resilience and determination of Downtown Doral, and the businesses that are located there, make us more excited than ever about opening a business in Doral. We have received countless messages of support and enthusiasm for our business from the local community. Further, the sales and absorption of the housing stock in Downtown Doral and the surrounding area demonstrates that we have a built-in audience for our programming, entertainment and dining. Although we are disappointed that we are not able to serve the community at this time, we are deeply grateful and excited about our new space and the community which we will serve.
Source: Miami Herald