Five Park Miami Beach | The Investment Value of the Park Residences

In this article, we delve into a research analysis conducted for a client exploring the investment potential of a 2-bedroom unit at Five Park Miami Beach residences. Their key question: “Is this a good investment?”

This research was done for unit 1207 (Asking $2,485,000 / $1,712 per SF) and unit 1807 (asking $2,830,000 / $1,950 per SF) which are both ocean-facing units offering 1,451 of interior SF.

Why are we Bullish About The Park Residences at Five Park Miami Beach?

There is no other brand-new product in that price range.

There are NO new construction projects in the entire Miami Beach area that are selling at the price of Five Park. All the others are at $4M+ (if you are lucky to still find one) and are located on the sand. This is the only new condo with an ocean and/or bay view in the highly sought-after South of Fifth/West Avenue area. Because of this, there are no comparable sales from other new construction projects.

Extreme Low Inventory in the Resale Market

When I look at resale units, there are very few units for sale that were built after 2015 and offer 2 bedrooms in ALL SOUTH BEACH AND SOUTH OF FIFTH. I added two links below which will show you the current listings at any given moment. At the moment of this research, there were only FOUR newer 2-bedroom units that were listed below $3M.

To keep this article current, I won’t delve into each comparable unit. However, please consider the following facts:

• How many listings are there in ALL of the South Beach and South of Fifth Area?
• How many of these listings are priced below $3M
• Also, look at the price per SF (dividing the asking price by the amount of SF). Larger units tend to be more expensive so therefore we use price per SF. Then compare that to the price per SF of the Five Park Units referenced at the start of this article.
• How many listings are located in brand-new condos?
• How many listings offer views of the ocean and or bay?
• How many listings offer the amount of amenities that Five Park offers?

You will notice that the price / quality ratio of Five Park is very competitve.

Resale Comps Support the Asking Prices of Five Park Miami Beach

• I found these 4 sales that can function as the best possible comps.
• Marea (801 S Pointe Dr). Properties trade for around $1,200-$1,250 per SF. This is a 2015 construction in a condo that does not offer any views (the units overlook the street). In addition, this boutique condo does not offer the same level of amenities.
• Monad Terrace (1300 Monad Terrace). A good comp here is unit 10C. This unit offers 1,453 SF as well and offers a glimpse of the ocean. This traded for $2,850,000 or $1,961 per SF. Monad Terrace was finished in 2021. It is more boutique with fewer amenities and it is in a less desired or exclusive area compared to Five Park

PERFORMANCE OF 2 Bedrooms over the last decade

This is the performance of ALL 2-bedroom condos (priced from $2M and up) in South of Fifth in the last 15 years

This is the performance of ALL 2-bedroom condos (priced from $2M and up) in Miami Beach/South Beach and South of Fifth in the last 15 years

As you can see the prices for 2-bedrooms have gone up considerably over the last two decades.

What will the Future Bring?

There are currently just 9 two-bedrooms for sale that are built after 2015. OF which the majority is listed as over $3M. We also know they are not building anything new. Nothing has been announced so for the coming 5 years we will not see any new units enter the market. We are dealing with a supply issue and in my last podcast with Craig Studnicky, head of Related ISG we discussed how we are not building fast enough to deal with all the demand.

Furthermore, we discuss interest rates. Most economists, about 94 percent of them, believe that the Federal Reserve might start reducing interest rates in 2024. When this happens we do expect another surge for Miami real estate as there is so much cash sitting on the sidelines and so many buyers are waiting to get into this market. I asked Craig the question: What if interest rates come down in 2024? This was his answer:  We will see the average price of condos go up by 10%. Why so much? Because there is tremendous pent-up demand. People are waiting for that opportunity. The inventory is scary low and people are literally waiting to make the purchase. The second part is still being edited,  but this is part 1 of that podcast.

The best Miami Condo investments with the highest appreciation

I wrote an article about Miami’s best-performing condos, and what they all have in common. Applying this to Five Park I see a lot of reasons to be bullish about Five Park

• Lot Size: Five Park sits on a large lot and is bordered by 3 acres of a park dedicated to the city. It does not feel cramped between other condos.
• Not being overly boutique: Five Park is not a mass project but it is highly amenitized
• Unit format: Flow-through units or units wide unit frontage (having the widest possible living room view of the water), and fewer internal disruptions to architectural flow perform best. Unit 1807 offers wide ocean views and has a functional floor plan. 
• Views: Of course water views are preferred but variety is also essential. The top choice of unit is one where you see BOTH water and the city. This is the case with the units at Five Park.

In Conclusion

I’m very bullish on the two-bedroom units at Five Park:

• You are buying a 2-bedroom in a market that barely offers any new 2-bedroom units and neither are any new condos planned. The demand is higher than the supply and when interest rates come down, we expect another surge of buyers resulting in a 10% increase in prices.
• The comps of active listings and closed sales support the unit’s asking price.
• We have seen the historic data of luxury two-bedrooms, which show prices have been increasing.
• The unit and project are very much in line with what our study found as “characteristics” for being a top-performing condo that appreciates over time.

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