Greenspoon Marder Talks Challenges of Massive Growth for South Florida Real Estate

While the hospitality sector took a sudden, horrible hit at the onset of COVID, Florida hotels came roaring back at almost the same velocity.

“To say that we took a hit during the pandemic is an understatement. It was quite a shock,” said Gerry Greenspoon, co-founder and co-managing director of Greenspoon Marder LLP during a recent video conversation with Commercial Observer executive director Robyn Reiss. “But then we took off again within the same year. By the last quarter of 2020, things started to open up again. There was just too much pent-up demand by restaurants, hotels and condominium developers in the South Florida area, and in Miami in particular.”

This was just one of the pressing South Florida issues discussed by Greenspoon and Reiss during a recent conversation on video at Commercial Observer’s South Florida Leadership Reception.

Reiss and Greenspoon then got into the negative flip side to South Florida’s current real estate landscape in the form of high rents. 

“Issues we’re facing include affordable housing, as a result of our tremendous and exciting growth,” said Greenspoon. “Prices skyrocketed here as high as probably anywhere in the country or even the world. Although that’s wonderful to see, it does create problems. We have growth in the industry, but obviously we need places for our employees and executives to live and work.”

On the topic of challenges, Greenspoon noted that with sudden growth comes challenged infrastructure, given the added pressure on water usage, sewers and drainage, and that solutions to these issues typically lag behind development.

Advances in sustainability also present a challenge for developers  in terms of keeping up with progress, said Greenspoon. Items such as electric vehicle charging stations, solar options for housing, and other renewable energy options are relatively new, but quickly coming to the fore for municipalities.

In Miami, as one of the top coastal cities facing the threat of rising sea levels, sustainability challenges have to be top of mind for developers. 

Greenspoon advised developers to work closely with the city to help implement strategies that mitigate the dangers of climate change, while developing an intimate knowledge of the communities in which they’re developing properties.

“Understand the political climate and intent of those who are in control. What are their hot buttons?” said Greenspoon. “There are many experts available to developers locally who understand that it’s hyper-local. We have counties, and municipalities within each county, and municipalities have tremendous control over what goes on in their city. So it’s really about getting to know, understand and deal with the concerns of that particular community.”

Reiss concluded the interview by asking Greenspoon for an example of a complex commercial real estate challenge that he recently helped a client overcome.

“We typically deal with complex structures where there’s a multi-use factor to the property. That’s become a norm in South Florida,” said Greenspoon. “You’ll see a commercial segment, a condominium segment, a hotel segment and a condo hotel. We put all of those together and make sure we protect the developer for ultimate control of the commercial areas they want to control in the future. Because you never know — commercial development changes over time.”