Brittani Rivera says she and her husband plan to stay for now as renters in Pompano Beach — but know that as their community is converted into condos, they’ll move out.
Residents of Envy Pompano Beach, at 475 SE 1st St., learned months ago that the community will be among the latest rental apartment buildings in South Florida being turned into condominium buildings.
Developers say the South Florida housing market is better-positioned now to offer condos. Condo conversions also are planned in cities such as Hollywood and Dania Beach. With the potential for lower mortgage rates, some would-be homeowners may find a better opportunity to buy.
“People want to buy their own homes,” said Envy’s developer, Peter Jago, the managing director of GCF Development. “It’s expensive to live in Florida, to get into something at a good price. I think (interest) rates will come off in 2025 and that will add a new dynamic to the market.”
“We took a right route,” he predicts. “Young people today can’t buy a home because it’s too expensive, and this is a perfect range of starter. Rents continue to climb but a mortgage doesn’t.”
Envy Pompano Beach, a new community built just a few years ago, features two buildings, each 14 stories tall. There, condo sales will start to the general public in late January, Jago said. The community’s new name could be either Envy Condos or Envy Residences, and sales will start at $350,000 and reach $1 million, he said.
Brittani Rivera said she has lived with her husband at Envy Pompano Beach, paying $3,600 a month for a two-bedroom, two-bathroom residence.
As the conversion was announced, she said they were given options: She said she was offered a chance to buy her home for $700,000, or less than it will be offered on the market.
Rivera said she and her husband declined, but took advantage of the offer to lease for another year. Then, they’ll move and shop for a house nearby instead, she said. She feels she can buy a bigger home for less money and “ultimately have more space,” she said.
Pompano Beach Mayor Rex Hardin said city officials always knew a condo conversion would happen for Envy. He said the original developer told him that the project was built with upscale amenities to “allow for future conversion when the market was right,” Hardin said.
“It was built as condos, with that in mind. It was destined to become condos eventually,” he said. “We need more housing, whether it’s condos or apartments.”
In addition to Envy, Jago’s company also owns Circ Apartment Residences in Hollywood, which could be renamed Circ Condominiums or Circ Residences as an apartment-to-condo conversion.
The project is 25 stories and 386 units. Circ officially began sales as condos in November for the one-, two-, and three-bedroom condominium homes.
The homes are being advertised as having oversized windows and expansive patios that offer “enchanting views of ArtsPark, Young Circle, or the picturesque Hollywood Beach, right at residents’ doorsteps.”
He said the project was built five years ago as rental apartments “because the market was not ready for condos.”
When the condo market came to what he called a “grinding halt, collapsed,” in 2007 and 2008, it took “many years to turn around.”
Jago said there is currently a “massive shortage of condos (between) $400,000 and $1.5 million.” These units are in downtown Hollywood, but since it is less than a mile from the ocean, there is an ocean view. “That’s where the shortage lies,” he said. “On the ocean is very expensive, there’s not a hell of a lot of availability.”
The process of a conversion takes about a year, with laws dictating the rights of tenants for both the notice and their first right of purchase, he said.
Planning changes
Another condo conversion plan also is underway in another city: S2 Development President Marc Schmulian purchased the six-building Atlantica project in Dania Beach before it opened as rental apartments, he said.
It is now condos, and the first residents started moving in earlier in December.
The Broward County Property Appraiser’s Office said it is just now starting the process of creating new parcel identifications because it received the “Declaration of Condominium” documents showing it has been converted.
Schmulian said the project, which is walking distance to the beach, is the only new product on the market east of Federal Highway between Pompano and Bal Harbour that is less than a decade old and units less than a million dollars.
His units are selling from $450,000 to $760,000. Each of Atlantica’s six buildings are three stories tall, and the project has a total of 124 homes. A seventh building is reserved for amenities including a dog park.
Schmulian said he pounced on the opportunity to buy the project because he anticipates the market changing because interest rates are coming down.
“When (interest) rates start to come down, there’s more appetite to buy than rent,” he said.
Developers, as part of their job, “try to preempt and anticipate what the market is going to do. The problem is developers are always two to three years in the process because that’s how long it takes to get from A to B.”
But a condo conversion gives you immediate inventory, he said, for times when “you see the writing on the wall, when there’s a lack of for-sale inventory and you want to get to the market much quicker than putting a shovel in the ground and waiting two-three years for a project.”
Preconstruction sales appeal to buyers who are “buying a dream, buying a lifestyle,” he said. “Whereas if you’re buying into an existing building, you know what you’re buying. You can see and touch and you can live that lifestyle from Day 1.”
Housing trends
Keeping an eye on the housing market has been Jack McCabe, a Deerfield Beach-based housing analyst.
“I think we can expect to see more, we’re on the cutting edge of it happening again,” McCabe said of condo conversions.
One of the last times that condo conversions were at their height was in the early 2000s. Prices had gotten so high on new condominiums and single-family homes that the majority of the South Florida population was priced out of buying, he said.
“So developers saw this and saw they could buy apartment complexes at a relatively cheap price per unit and do some cosmetic improvements … and resell them for $200,000 to $500,000 because that was the height at the time. And they were buying the units for $40,000-$80,000 each.”
Then came the Great Recession, which resulted after losses on subprime mortgages struck the U.S. housing market.
Today, McCabe expects more developers to buy older apartment buildings and tear them down “to the studs” and build brand new, or just spruce up newly built buildings yet again. It comes down to finding places to build new homes, since Broward County is considered built out, but still growing.
Lisa J. Huriash can be reached at lhuriash@sunsentinel.com. Follow on X, formerly Twitter, @LisaHuriash
