A new real estate trend has emerged and is transforming the urban landscape of South Florida. With the rising demand for housing and retail spaces facing obsolescence, developers are now looking for innovative solutions to repurpose underutilized properties. One such solution that is considered most feasible in the current scenario is the conversion of shopping malls into residential units. This real estate transformation showcases a significant shift in the region’s urban dynamics.
According to Forbes, the Urban Land Institute, and the National Multifamily Housing Council Research Foundation, there are approximately 1 billion square feet of outdated retail space in the United States at present. In South Florida, this trend is particularly noticeable. As per a recent report by Norada Real Estate Investments, Miami’s housing inventory remains approximately 37% below the region’s historical average. This highlights the pressing need for more housing options.
This real estate transformational trend began with iconic shopping malls like Sunset Place, located on the South Dixie Highway and Red Road. A vibrant hub for shopping, dining, and entertainment since its inception in 1999, Sunset Place now stands desolate, devoid of any footfall. Realtor Bryan Gorrita, an industry expert, has emphasized the necessity of diversifying community offerings beyond retail outlets.
Midtown Equities spearheads the redevelopment of Sunset Place, with ambitious plans that are yet to be revealed. Despite multiple attempts to reach the developers, media outlets have received no response from them. Insights from the City of South Miami, however, reflect on a mixed-use approach that integrates residential units alongside food and beverage amenities.
Venturing south to Cutler Bay shows another ambitious initiative with the metamorphosis of Southland Mall into South Place City Center. This transformation plan includes 4,000 residential units, extensive retail space, dining options, a hotel, medical offices, and an amphitheater. With a promise to redefine community living, the development of this project is expected to generate approximately 2,700 new employment opportunities upon completion.
While initial projections indicated completion by 2029, recent updates from the town of Cutler Bay hint at a revised timeline and also an increase in the number of residential units. Despite the challenges of adapting mall spaces into residential units, the allure of living in prime locations and high foot traffic makes such endeavors worthy for the developers.
Dr. Eli Beracha, Director of Hollo’s School of Real Estate at Florida International University, sheds light on the complexities involved in such real estate conversions. He has emphasized the necessity of extensive renovations, considering the inherent disparities between retail and residential infrastructures. Developers are overcoming these challenges as they are incentivized to create vibrant, self-contained communities which are also called “mini-cities” or “destinations.”
Palms at Town and Country is a perfect example of this trend as it has been repurposed from the Kohl’s building into 12-story apartment complexes. The transformation reflects the vertical expansion which is imperative to accommodate growing populations. According to Realtor Bryan Gorrita, this shift is not merely a response to housing shortages but an effort to reimagine Miami’s urban landscape.
While questions regarding affordability persist, initiatives like the Live Local Act aim to incentivize developers to prioritize the workforce and make housing affordable. However, Gorrita predicts a surge in rental communities, which highlights the need for diverse housing options considering Miami-Dade County’s land constraints.
The convergence of housing demand and retail obsolescence has brought a major shift in South Florida’s real estate landscape. As shopping malls evolve into multifaceted residential units, they not only address the longstanding issue of housing shortages but also foster vibrant, inclusive communities.
