Real Estate News

Old Coral Gables apartments getting razed, then replaced with $50M luxury home enclave

By Rebecca San Juan

Updated June 02, 2023 10:35 AM
The Village of Coral Gables will include 48 condominiums, duplexes and townhouses. This is a rendering of residences and a courtyard. De La Guardia Victoria Architects & Urbanists

Affordable apartments that had been home to middle-class residents are being demolished in Coral Gables, making way for a new beginning — a $50 million village mostly for millionaires.

The Village of Coral Gables real estate project has been in the works since 2021. It will convert an entire block just west of downtown once filled with 13 rental buildings with 52 apartments into a community of pricey condominiums, duplexes and townhouses.

After the demolition that began in May, Coral Gables-based MG Developer Miami expects to start construction in August, the firm’s founder Alirio Torrealba said. The development will include 48 new residences — near a recently renovated Coral Gables public library branch — in a Seville-inspired community, imitating the Mediterranean architecture that distinguishes the Coral Gables neighborhood from other South Florida communities. The project is expected to finish by the second half of 2025.

Homes will range from a 1,700-square-foot two-bedroom, three-bathroom condominium with a den for $1.9 million to a 3,700-square-foot three-bedroom, four-bathroom townhouse for $4.2 million.

Prices will range from $1.9 million to $4.2 million for the homes getting built in The Village of Coral Gables. This is a rendering of a master bedroom in one of the residences. De La Guardia Victoria Architects & Urbanists

Making room for The Village of Coral Gables has uprooted longtime renters in the area, raising concern over the continuing trend in the Miami area to build luxury homes at a time when real estate experts have said South Florida desperately needs more attainable housing for local residents. In April, the median price for single-family houses in Miami-Dade County reached a record $600,000, up from $565,000 a year ago and surpassed the former peak of $579,000 in June 2022.

The developer paid $20 million in 2021 for the 17 adjacent lots for the project. The lots are bordered by Malaga Avenue, Santander Avenue, Segovia Street and North LeJeune Road.

Apartments like the ones being razed on those lots have disappeared in the Gables, as real-estate speculators and developers catering to an unrelenting demand for luxury condos and apartments buy them. The trend is pushing out many longtime, middle-class and lower-income Gables residents. The old apartments were built mostly after World War II, and command lower-than-prevailing rents because of their age and typically small units.

In spite of Coral Gables’ reputation as a haven for the rich and the ultrawealthy, the city of about 50,000 people has long been home to hundreds of older apartment buildings.

The pandemic that emerged in early 2020 caused a wealth migration from elsewhere in the United States to South Florida and that has motivated developers to build more luxury housing. During the pandemic, executives and remote workers with deep pockets moved here. Although Miami-Dade’s overall home sales overall have slowed considerably over the past year, developers say they still see strong demand for residences priced above $1 million.

"When we compare Miami to before the pandemic, I consider it to be a stronger real estate market," Torrealba said. "Coral Gables continues to have little luxury inventory."

Torrealba said since starting sales in November 2022 for homes to be built in The Village of Coral Gables, 10 residences are sold to mostly local buyers looking to downsize from another nearby home or young couples starting a family. His development firm has all of its city approvals and permits on hand to start construction, and is talking with lenders to secure construction financing.

Craig Studnicky, co-founder and CEO of RelatedISG International Realty, an affiliate of the condo development firm Related Group, said his brokerage in Coral Gables continues to see young families from California and New York flocking to the city. RelatedISG gathers and analyzes data on the luxury condo market, as well as sells luxury condos.

"I think they are going to be phenomenally successful," Studnicky said, of continuing sales of The Village of Coral Gables residences. "The price point is the sweet spot."

The Village of Coral Gables will include a pool, like the one pictured in this rendering, plus a gym and business center. De La Guardia Victoria Architects & Urbanists

The builder MG Developer Miami has a track record of luxury townhouse construction in the Gables. Recently, the firm expanded its reach into Hialeah with plans for apartment rental buildings. Still, the developer continues to invest in Coral Gables and, Torrealba said, he intends to build another development in the City Beautiful. He hopes to build a 12-story building with 68 condos at an undisclosed site.

Lizette Gruma, who lost the one-bedroom apartment she shared with her partner Tito Plua to clear the way for the new luxury housing project, said she can’t understand the indifference to the plight of residents like herself, or the lack of discussion by Coral Gables local leaders over any measures to control residential rents, preserve affordable housing, protect renters or render basic orientation or assistance.

"Here are 50-some families that will be displaced. It’s getting out of control," she told the Miami Herald in an April 2022 interview. "I don’t understand the government. Why isn’t there a cap? The rents are ridiculous. But they don’t care. At the end of the day, they don’t care about the families here. I think there’s too much greed."

A drone view of a Coral Gables block once made up of 13 affordable, older small apartment buildings that are getting torn down to make way for a luxury residential development called The Village of Coral Gables. The block is bounded by Malaga Avenue and Santander Avenue to the north and south, and Segovia Street and Hernando Street on the west and east. Pedro Portal [email protected]

This story was originally published June 02, 2023 5:30 AM.