Builders bullish on housing as new apartments get ready to launch in West Palm Beach
Can there be too much of a good thing? Not when it comes to building new apartments, it seems.
In West Palm Beach alone, at least four more projects are in the works by developers eager to cater to residents moving to the area.
The projects include Cielo, a 263-unit apartment building planned on Dixie Highway by Cypress Realty in Jupiter. The site is just north of the Loftin place apartments, the 259-unit complex built by Cypress after the 2008 recession.
In addition, a 16-story, 223-unit apartment dubbed 303 Banyan will rise at 303 Banyan Boulevard, across from the courthouse complex. An affiliate of Woodfield Investments recently paid $8.9 million for site, formerly owned by a group of local investors.
To the west, a 280-unit apartment complex dubbed Broadstone at Lakeside will be built at 3600 Village Boulevard, west of Interstate 95 and south of 45th Street at 3600 Village Boulevard. The developer is Alliance Residential.
And Palm Beach investor Jeff Greene said he's considering building an apartment complex on mostly vacant land he owns on Datura Street at South Dixie Highway.
The slate of new projects, which would add hundreds more apartments to the city's housing inventory, come following the recent completion of more than 1,000 apartment units in or near the downtown during the past few years.
They include the 315-unit Broadstone City Center, at 410 Datura St.; the 290-unit Park-Line, between Datura and Evernia streets west of the Florida East Coast Railway tracks; and the 205-unit The Alexander, at 333 Fern Street.
And just south of downtown at 3111 S. Dixie Highway, Time Equities just built the 300-unit Casa Mara, a garden apartment complex spread out over 10 acres.
Despite all these new apartment complexes, developers say there's still room for more.
"We're the second-fastest growing state in the nation besides Texas, and there's pretty strong demand for all types of housing," said Michael Ging, managing director of Alliance Residential Co.
In fact, since Nov. 1, one construction company, Kast, has provided budgets on 12 potential Palm Beach County apartment projects totaling 3,000 rental units, said Dave DeMay, Kast senior vice president.
Alliance is no stranger to West Palm Beach. The company built Broadstone at City Center, which leased up a year ago, prompting interest by Alliance in more apartment sites.
In January, Alliance paid $11.5 million to Family Church for 30 acres on Village Boulevard. (The church sanctuary will remain on adjacent property still owned by the church, Ging said.) The Alliance apartment site is near another apartment complex already under construction: A 374-unit complex dubbed Palm Beach Riverstone, on 45th Street.
What makes Ging particularly upbeat about Palm Beach County is that his company has received rental inquiries from people seeking to move here from far-away states such as California, instead of the typical Northeast states.
"I've been doing this for 33 years, and very rarely do we see interest from California," Ging said.
Ging also is optimistic about the continued migration of companies to Palm Beach County.
The coronavirus pandemic has led to a number of financial firms moving or expanding to the area as they chase wealthy customers and enjoy the low taxes and better weather in the Sunshine State.
The same sentiment was expressed by Cypress principal, Nader Salour.
In 2014, when Salour started building Loftin Place, at 805 N. Olive Avenue, he was the first developer to build an apartment complex downtown following the recession. After Cypress leased out Loftin Place, the property was sold in July 2017 for $63.5 million.
But even as he was wrapping up leasing, Salour was feeling iffy about building Loftin Place's second phase. Back in 2016, he decided to pause new construction on land adjacent to Loftin Place because so many other complexes were coming to the market.
Salour isn't feeling hesitant anymore, however.
Given the accelerated migration to Palm Beach County in recent months, Salour said he thinks now is the time to build apartments on the site just north of Loftin Place. Cielo, the apartment complex's name, is Spanish for sky.
"Everybody had already foreseen this migration, but nobody thought it would happen at quite this intensity," Salour said. "We're very bullish."
As proof, Salour cited the deals taking place at the newest office building in the city, the 360 Rosemary office tower next to Rosemary Square, formerly CityPlace. A number of financial firms are leasing space in the tower. Among them is New Day USA, a Maryland mortgage servicer that is moving to West Palm Beach and bringing 600 jobs to the city.
Apartment construction isn't just happening in West Palm Beach, however. It's a trend taking place across Palm Beach County.
In just one pocket of Boca Raton, a business park now is home to at least four apartment complexes, following a change by the city that ended a decades-long prohibition on building residences in the former industrial park.
The new apartment complexes include the 398-unit 10X Living; Allure, a 282-unit complex; Avalon 850 Boca, a 370-unit complex; the 270-unit Bell at Broken Sound, and Aura Boca, a 322-unit apartment complex.
And it doesn't end there. Related Development, an arm of Miami-based Related Group, is building the Manor Broken Sound, a 297-unit apartment complex in the business park, known as The Park at Broken Sound.
Salour had planned to join the Boca Raton construction trend and build hundreds of apartments to the west and south of the Park at Broken Sound, on commercial land Salour owns along Military Trail near the Town Center mall. The land consists of a bowling alley and a former gym.
But the city never rezoned Salour's commercial property to allow for apartments, prompting Salour and two other commercial property owners along Military Trail to sue the city. Their Palm Beach County Circuit Court lawsuit failed, as did an appeal before the 4th District Court of Appeal.
"We're very disappointed," Salour said. "I could have rented (apartments out) in record time in that location. But the elected officials didn't want it."
So Salour will focus instead on building Cielo in West Palm Beach.
Cielo will consist of two, eight-story towers on opposite sites of Eucalyptus Street, just east of North Dixie Highway. The buildings will be connected by a bridge, and the buildings' design will be more modern than previously planned. Salour wants to increase the number of one-bedroom units at Cielo to about 70% of the project, including adding dens to the one-bedroom units so residents can have a home office to accommodate the work-from-home trend. Only about 30% of Cielo will be two-bedroom units, he said.
Salour is awaiting final city approval for the project because he is seeking to boost the project's density to 263 apartments from 204 approved apartments.
But Woodfield already is starting construction on 303 Banyan, with Kast Construction of West Palm Beach commencing site work. The apartments will be built on the site's parking lot, but a Wells Fargo bank branch will remain.
Back in 2019, when the Banyan property first went under contract for the property, Woodfield's Todd Jacobus said he liked its proximity to to Palm Beach. He also liked that family offices and other finance-related businesses were moving to Palm Beach County even then.
Woodfield is familiar with West Palm Beach. The company built the Oversea, a 251-unit apartment complex that is part of Flagler Banyan Square, a mixed-use development on the old city hall site near Flagler Drive.
As for Greene, he's eying the West Palm Beach apartment market carefully.
He still has apartments available for lease at Cameron Estates, a 548-unit apartment complex he built west of the downtown, off of Palm Beach Lakes Boulevard near the Palm Beach Outlets mall.
But Greene said the demand for downtown apartments has caught his attention, even as he continues to build a 30-story, twin-tower complex dubbed One West Palm, featuring 328 apartments in one tower.
Greene said he's considering building apartments on four parcels he owns along Datura Street, just east of S. Dixie Highway.
The property, he said, "is in the dead center of town" and a block south of the Clematis Street dining and entertainment district.
Greene said he just dialed up an architect to start planning. He's thinking a 12-story complex could feature apartments catering to would-be residents who want to be close to the action. "It's a nice site. I like the location," Greene said.