Diego Estrada

Diego Estrada started his company, Tectum Real Estate, a little over a decade ago and was able to see the incredible transformation in Brickell, where he concentrates a large part of his business.

In this conversation, he gives us his perspective on the market in this section of Miami.

Versión en español

IN. Where is Brickell's development going? How do you see it today?

DE. In 2010, Tectum started with the sale of Icon, which was the first project with which we began to sell strongly. If you look at it in perspective, Brickell had different times.

As of 2010, Icon and Axis were selling a lot. Then a plateau came (and) it seemed that Brickell was left behind. Some said that there was excess inventory and that the takeoff was not going. Instead there were developments in Sunny Isles and other areas. But in recent years, with projects like SLS and SLS Lux, then Brickell City Center, Flatiron, plus all the business development on South Miami Avenue, they took a big turn. And today, Brickell is seen differently by American Chicagoans, or New Yorkers, who want to have a second home in Florida.

They see Brickell as a different place than Miami Beach or Sunny Isles, which are just another vacation market. That American public today is becoming interested in a Brickell corridor that has also been extended to the north with the Aston Martin and Waldorf Astoria buildings.

And for the other side, look now at the arrival of St. Regis, which is launching the second tower. It is a landing of an important brand, and that part of Brickell is also beginning to move toward the entrance of Key Biscayne, which seemed calmer and is (now) beginning to boom with these new developments..

IN. Who is the typical buyer of apartments in Brickell today?

DE. The large percentage of buyers are people who come from other large cities in the United States. New York, Chicago, Boston, or places in California. It has happened to us in recent shows that Realtors represent people who are in New York or other cities, see the apartment on Facetime and buy.

The transformation and consolidation of Brickell began with the arrival of the American who sees Miami as an option. The Latino buys more for the beach, for vacations or for rent.

The small gastronomic hub – with Sexy Fish, Baires Grill, Lolita, North Italy, Toscana Divino, P.F. Chang, and others – began to show gastronomic and entertainment offerings, and the requirements for living in a big city, which were not there before.

In 2000 there were few buildings. Then there were offices, but nothing to do. Today in Brickel people live, entertain, shop. There is a growth in the leisure offer that did not exist before.

IS. There is a lot of construction coming. Do you see a high risk in Brickell's future supply when all these high-end projects come up for sale almost simultaneously?

DE. Today, inventories in Brickell are still very low. There are very few apartments for sale in buildings with many apartments, like SLS, Icon and Brickell on the River. They are buildings that have some 500 or more apartments and there are very few – 10 or 20 apartments – available for sale.

I was a banker and what I am seeing is that these high-end developments, which have between 1,000 and 2,000 units, with a good marketing campaign in the big cities, are sold. The American with strong purchasing power does not see these projects with a level of risk.

Looking back, there are two levels of observation: Florida and the United States. And we have to see where inflation goes, and what finally happens in interest rates.

Today if you look at a Treasury Bond curve, it is flat; it is the same to buy debt at one year, at 5, at 10 or at 30. When you look at the mortgage curve, it is inverted; that is, mortgages are more expensive below $600,000 than the highest. Inflation is going to impact what happens to economic activity in the United States.

Although Florida is experiencing a moment of splendor today, a more complex situation is going to end up having repercussions here – although it is difficult to say this today, in the midst of a sales euphoria.

The truth is that there are still many “ifs” because we do not know if this euphoria that Florida is experiencing – with 400-500,000 people who have arrived in recent times – is a phenomenon of people who came to stay or to see what happens with this lifestyle.

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