By Robyn A. Friedman
City & Shore Magazine
Many experts agree that now is a great time to buy a new home in South Florida. Interest rates are at historic lows, making homes more affordable. In some markets, inventory is tight, so demand may cause prices to rise over time. In others, there’s a growing oversupply of new product, creating competition among developers – and giving buyers more bargaining power.
Still, some developers are offering creative sales incentives to “sweeten the deal” for potential buyers in an attempt to better market their projects, entice buyers in the door and, ultimately, encourage sales. These incentives can create buzz when sales are slow, help close out a project where sales have otherwise been strong, attract new buyers to a non-waterfront project or other development that’s not in a prime location – or just serve as a new marketing tool.
“With incentives, sometimes people who are on the fence feel that they need to move quicker,” says Anthony Graziano, a Miami real-estate consultant. “It’s just like any kind of giveaway or sales incentive.”
Graziano says that some developers offer incentives as a way to avoid lowering prices when sales are slow – and that luxury buyers understand that the incentive is already priced into their unit.
Here’s a sampling of some incentives, amenities used by developers in South Florida:
Verzasca Group LLC, a developer in Bay Harbor Islands, offers condo buyers at its project Aurora a one-year membership to JetSmarter, a private jet company.
“It’s a great add-on for our clients,” says Tim Lobanov, Verzasca’s managing director. “It creates marketing buzz.”
The membership, which Lobanov values at $9,500, is available to clients as soon as they sign a contract. It’s beneficial to buyers from the Northeast who split their time because they can catch one of JetSmarter’s shuttles and be in South Florida in a few hours.
Aurora, located across the street from the beach in Sunny Isles Beach, has 61 two- and three-bedroom units with prices starting in the low $800,000s. Lobanov says completion is expected in late 2018.
Buyers at Terra’s Botaniko Weston, a single-family-home development, receive a one-year membership for two people to Midtown Athletic Club in Weston, a resortlike athletic club that offers tennis, fitness and training, yoga, aquatics, a spa, bistro and boutique. Buyers have three years from their purchase date in which to activate the membership.
Museum and Gardens
Buyers at Paramount Fort Lauderdale Beach receive a one-year membership to Bonnet House Museum & Gardens in Fort Lauderdale. About 80 percent of Paramount’s 95 two-, three- and four-bedroom units and penthouses are sold. Prices range from $1.2 million to $9 million.
Buyers of a penthouse unit at Riva in Fort Lauderdale receive a 35-foot boat slip, valued at $150,000 and suitable for powerboats up to 33 feet. The two-story penthouses, priced from $2.25 million to $3.9 million, have nearly 7,000 square feet of indoor-outdoor living space.
Boca Raton-based SOFA Partners, the developer of 111 First Delray, is offering interior design services to those who purchase through August. Felipe Vergara, a SOFA partner, says the promotion started in early July. 111 First Delray has 70 studios and one- to three-bedroom units priced from the low $400,000s to the upper $900,000s. Vergara says that buyers before Aug. 14 will also receive upgraded home automation packages.
Marrano Homes, developer of 1200 The Ocean, an 18-unit oceanfront condominium in Hillsboro Beach, recently offered an old standby to potential buyers: up to a $100,000 cash discount on the units, which range from $945,000 to $2.39 million. Buyers could use the incentive, which was available to those who purchased between mid-April and the end of June, to upgrade their unit or just apply it against their purchase price.
“The traditional selling season down here typically ends in late April, and we wanted to continue our sales momentum into the summertime,” says Victor Martucci, project manager for 1200 The Ocean. “We thought it would be a good idea to use a cash incentive. We looked at other things, but cash being king, we thought it was the best way to keep the momentum going.”
The promotion worked. Martucci says that traffic from potential buyers increased and that two units sold at a time when it was traditionally off-season. He says the developer is evaluating whether to use another incentive for the balance of the summer.
“Promotions do not sell – they drive traffic,” Martucci says. “The project has to sell itself.”