Younger, wealthier, and coming from Asia. The profile of typical buyers in the premium second home resort market is dramatically changing. According to the latest Luxury Portfolio International research, while the baby boomers are traditionally buying second homes more often, the new group under 40 is fueling the premium market, creating a spotlight opportunity for sellers. That younger crowd accounts for almost half of interested buyers or at least half of those looking.
“We believe the demand for premium units in the domestic and international resort market will continue to get stronger. We already see an influx of demand for branded residences with value-added services such as building maintenance, housekeeping, concierge facilities, etc.,” shares his insights on the research Daniel Kodsi, CEO of Royal Palm Companies, a leading South Florida developer. “As individuals increasingly become global citizens with diverse business interests, time is becoming a rare commodity. They want the most amenities in the world in one place.”
Another advantage of ownership resort property is holiday rental and investment yield potential. Now, 60-80% of buyers put their property in the rental pool, which is double what it might have been ten years ago. These rental programs tend to be a bigger driver in resort locations as those buying in cities tend to use them more regularly. It’s the right time to take advantage of this need by investing in mixed-use products providing the services and amenities of a full luxury hotel to the vacation residence users.
According to the latest report compiled by UBS and Campden Wealth Research, premium real estate gained the greatest traction in family offices portfolio this year, with allocations rising more than any other asset class, by 2.1 percentage points. That dynamic signals that most of these buyers are beginning to inherit substantial amounts of money from their parents and invest in real estate.
Where do millennial millionaires want to buy? In Florida, of course. The ‘sunshine’ state ranks among the top seven states (after California and New York) where young and wealthy buyers look for property, based on the most recent “A Look at Wealth” study by Coldwell Banker Global Luxury and data surveyor WealthEngine. Downtown Miami is a rising star on a global map. While New York and Los Angeles are stagnant, the Downtown population has increased by 40% since 2000, according to the local authorities. Last year, Miami broke tourism records – 16.5 million overnight visitors and 6.8 million day-trippers came through – and 2019 is likely to top those. All of this bodes well for the city’s hospitality industry.
The $4 billion mixed-use Miami Worldcenter is underway on almost 30 acres that are poised to become a magnetic destination for tourists and business visitors in the heart of Downtown Miami, with its impressive collection of historic landmarks, world-known museums, and waterfront parks. This is the most significant mixed-use development in the U.S. after New York’s Hudson Yards.
This year, PARAMOUNT Miami Worldcenter, a condo tower designed with a “residential Skyport” for a future of flying cars, has been completed and already roughly 90% sold to buyers from around the world – from Turkey, China, the UAE to Brazil, Venezuela, and Sweden. The next global debut at Miami Worldcenter is Legacy Hotel and Residences, with 278 branded condos above 255 hotel rooms, the city’s first enclosed rooftop atrium, and a first-of-its-kind medical and wellness center. Royal Palm Companies’ plan is to break ground in June and complete the building within almost three years. The tower will join a wave of new projects with rental options for buyers.
For Meritxell Sedo
For Gabriela Huerta