Condo Zombies Haunt Miami

Brian Hicks

Updated June 26, 2009




Here is the beginning of a blog post I wrote some time ago about the oversupply of condos. It dealt with an impending condo collapse in Miami.

It reads…

“Ah condos. Don’t you just love them? 

I mean what with all of that concrete and blacktop what’s not to love?  

Throw in the elevators, the creepy hallways, and that collection of busy bodies otherwise known as the condo association and its hard to see why we don’t all live stacked up on one another in a neat little box.

It kind of makes you wonder how the condo market could be so down these days. After all if a 1200 sq ft condo isn’t worth at least 500K what is?

In fact, as hard as it is to believe, things have gotten so bad in Miami lately that a local bank has “blacklisted” 191 new condo projects there, refusing to make any loans in any of those buildings.

Of course, if you were one of the unfortunate folks that bought one these units before the bank pulled up the ladder you’re probably going to have the pool all to yourself now.

That’s because it won’t be long now before all of the other banks follow suit, and when they do you’ll have the place all to yourself, sort of like Jack Nicholson did in “The Shining.”

But at least you can solace in this as you race around the empty halls on your Big Wheel—-your losses will be nothing compared to what the banks that funded these empty towers are going to lose now.

After all, how can they possibly get all of those millions back now if nobody else will make the loans needed to sell all of those units?

That’s why commercial real estate is pretty much the next shoe drop in this mess.”

I bring it up because 17 months later, my sarcasm has turned out to be pretty close to reality.

From the Miami Herald by James H. Burnett III entitled: Condo dwellers finding empty buildings

“Joshua Hamann jokingly compares himself to the last human in a city overrun by zombies. He’s not suggesting his neighbors are zombies. The problem is, he has no neighbors.

Hamann dwells in a newly opened condo. And in the six weeks since moving into the gleaming new Everglades on the Bay in downtown Miami, he has felt pretty lonely. Hamann occupies one of only about 50 sold condos in his 49-story tower, out of 409 units.

A couple miles north at Midtown Miami, Alisha Marks knows the same feeling. ”It was pretty much a ghost town when I got here,” she says.

It’s an odd time for South Florida’s condo market. Over development compounded by the credit crunch and a sluggish economy created an abundance of condo units.

So, what is life like for the few residents whose lights are on?

”Weird,” says Hamann, a 28-year-old project manager for a window shading company, who rents the $400,000 one-bedroom, one-bath unit on the fifth floor. Everglades on the Bay opened in April and offers residents great views, clean white walls, spotless carpets, stainless steel appliances, a well-equipped gym, a pool, and even party rooms. Hamann moved in immediately.

Since then, he has one neighbor on his floor. It took two weeks before his first experience of sharing an elevator ride with a neighbor. ”He didn’t know how to react,” Hamann notes.

”I’m a sociable guy, but you can’t socialize with what isn’t there,” says Hamann, who commutes on weekends to the Gulf Coast where his wife lives. He jokes that before he moved in, he saw brochures featuring smiling ”crowds” hanging around the pool.

On a recent Friday morning, Hamann encountered exactly three people over the course of several hours — two security guards, and a concierge.

Several stops in the fitness center? Empty.

Several visits to the pool? Empty.

Several visits to the laundry room? Empty.

The building is emptier than the cheap seats during a Marlins game at LandShark stadium.

”This is how it goes every day,” Hamann said, adding that he interacted with more neighbors growing up in rural Kentucky, where farms were spaced a mile apart.”

You just can’t make this stuff up.

I wonder if Josh has taken the Big Wheel out for a ride lately.

Have a great weekend.

Related Articles:

Buffett: Economy is in a “Shambles”

Roubini Sees Significant Risk of a “Double-Dip” Recession

Prechter: U.S. to Lose AAA Rating

Green Shoots? Not According to Richard Russell

To learn more about Wealth Daily click here

Angel Publishing Investor Club Discord - Chat Now

Brian Hicks Premium