Miami's luxury condos causing "real estate apartheid"
America's housing market is soaring, and one Florida property is adding flash and bling to a beachside skyline. High above the Miami suburb of Sunny Isles Beach, buying a Porsche is taking on new meaning, CBS News' Vicente Arenas reports.
When Juan Pablo Verdiquio comes home, he'll park his car in an elevator that carries cars and people to their condos on any of the 60 floors in the Porsche Design Tower. It's the first elevator of its kind.
"It's unique, that's for sure. It is beyond crazy. Beyond crazy," Verdiquio said. "But it's a boy's toy."
Verdiquio, a 38-year-old shoe manufacturer, moved to Miami from Buenos Aires, Argentina, a year and a half ago. He was so ecstatic about the new feature in the building he plunked down nearly $4 million on a unit before construction even began.
"It's going to be a landmark. And not only a Miami landmark, a worldwide landmark," he said.
The Porsche Design Tower will have three elevators -- or "Dezervators" -- named after the building's owner, Gil Dezer.
"To put it simply, it's nothing different than a freight elevator on steroids. The lift is very, very heavy. It's about 40,000 pounds, but it goes up at 800 feet per minute," Dezer said.
The elevators were just the touch Dezer needed for the Porsche tower. He believed the brand name would attract wealthy buyers from around the world and help sell condos in a state rebounding from a devastating real estate crash seven years ago.
Units start at $4 million. Penthouses command over $30 million. Of the 132 units in the Porsche tower, only eight remain unsold.
"You know, branding an apartment gives the buyer something that they know what to feel and what to expect when they move into the apartments," Dezer said.
The high-end carmaker isn't the only luxury brand finding its way into the Miami real estate business. Other condos bearing designer names in south Florida include the Armani Casa and Fendi Chateau.
But not everyone is applauding the wave of luxury condos. For many, they're too expensive. They've also driven up the price of other homes and apartment leases near the beaches of Miami.
Shari Olefson studies the real estate market for industry regulators.
"We are experiencing more and more in Miami what I would call almost a real estate apartheid," said Olefson. "So we are really seeing a segmentation of social and economic classes by real estate affordability. Folks who are not on the top end of the earnings scale need to say goodbye to living on or near the beach."
Seventy percent of the luxury condo buyers in south Florida are foreigners, mostly from South America, where political or financial instability is of real concern. Parking their money in Miami's real estate is safer than a bank account back home.
"In many cases these are second, third or fourth homes for people, and they're not actually going to occupy these units most of the time," said Olefson. "Which means that the space is being wasted in areas where we really need it and they're not adding to the economy."
But as long as Miami remains the tropical playground of the rich and famous, developers will keep catering to them and high-end realtors like Nancy Batchelor will keep busy.
"Yes, I think this is a new trend. I think we're going to be seeing this over and over and Miami is still a bargain," Batchelor said.
