T
he Invesca Development Group has secured a $55.2 million loan to convert a 214-unit complex in Pompano Beach into condos. The Envy complex, completed in 2021 at 425-475 East Atlantic Boulevard, is part of this plan. This move comes as there is continued demand for condos and a slowdown in the multifamily market in South Florida. The bridge loan was provided by Palm Beach-based private lender Forman Capital, which was represented by BayBridge Real Estate Capital's Jay Miller and Spencer Miller. The Envy complex consists of two 11-story buildings offering studios to three-bedroom apartments, ranging in size from 703 to 1,026 square feet. Monthly rents start at $2,123 and go up to $4,470.
South Florida's multifamily market has experienced significant changes over the past two years. From late 2020 to late 2022, the tri-county region saw unprecedented apartment demand and record rent hikes due to out-of-state transplants. This led to over 42,400 units being under construction in 2022, the most since at least 2006, according to CoStar Group data. This surge in demand and rent increases has tempered, with rates plateauing or declining in some submarkets. Some landlords are now offering concessions to fill buildings. Envy's website advertises "2 months free" on select apartments.
Pompano Beach is emerging as a condo market of its own, with several projects underway. The Ritz-Carlton Residences, a two-tower, 205-unit condo project by Edgardo Defortuna's Fortune International Group and Ricardo Dunin's Oak Capital at 1380 South Ocean Boulevard, is one such project. The Pérez family's Related Group and the Motwani family's Merrimac Ventures plan to build a 28-story, 92-unit Waldorf Astoria-branded condo tower at 1350 South Ocean Boulevard in Pompano Beach.
In other rental-to-condo conversions, PMG switched its 646-unit Society Biscayne tower under construction at 398 Northeast Fifth Street in Miami to The Elser Hotel & Residences condo project in 2022. This marked the first condo conversion in recent years. Developer Chip Abele converted the 386-unit Circ Residences apartment tower completed in 2019 at 1776 Polk Street in Hollywood to condos. Last year, developer Henry Pino's Alta Development opted to switch its 283-unit River District 14 apartment project under construction at 1451 Northwest 14th Street in Miami to condos.
The shift in South Florida's multifamily market has led to developers pausing projects as they wait for market conditions to improve. The Envy complex's conversion to condos allows the landlord to immediately offer units to potential buyers, providing a more immediate solution than waiting for new projects to be delivered.
