The real estate market is dynamic. It usually moves up gradually until it reaches its peak, where demand for properties is high and prices are record high. After reaching the peak, what follows is the slowing down of the market. This is where the real estate market is currently. Most parts of the country are experiencing reduced demand for real estate, but the supply is high. The result is reduced property prices in most parts of the country. In Florida, however, things are different. Currently, the demand for real estate is high. Property prices are also high. Some experts attribute this trend to the beautiful weather experienced in Florida all year round. Others attribute this to the diversity of the population in Florida as well as its proximity to central and South America. Whatever the reason, Alex Kleyner of Miami’s ABK Capital has positioned the company to take advantage of the thriving real estate market in South Florida and Florida in general as the market continues to be strong.
Why the South Florida Real Estate Market is Hot
Market statistics show that there is a huge demand for properties in Florida and a shortage of supply. It is a seller’s market, so prices are expected to continue rising rapidly throughout the year. Now is a good time to sell if you have been planning to sell your property. If you are a developer, you can complete your real estate project and get huge returns on your investment.
In the first quarter of the year, the number of properties for sale reduced compared to the same period last year. The median property price increased considerably while the number of days it took to sell a property reduced from 64 to 53 days. The number of closed sales during the first quarter also reduced slightly due to the shortage of supply and the high APRs charged on mortgage rates.
How Alex Kleyner Miami ABK Capital Can Help
The high-interest rates charged during the first quarter had an impact on the market as they discouraged borrowing. Since the same rates also affect developers, most projects have stalled because high-interest rates make real estate development projects less attractive for investors as it reduces their returns. The sad thing is that, even with the high APRs, some lenders are still not willing to advance enough funds to property developers without collateral. Fortunately, ABK Capital was founded with real estate developers in mind. A local real estate developer DNA Builders who has worked with Kleyner’s company in the past said “We are seeing no slow down at all as more New Yorkers move to Florida. In fact the most expensive home in Fort Lauderdale was just sold for $28.5 million dollars according to the Real Deal.
Senior Secured Loans
ABK Capital has been offering secured real estate loans to property developers to help them get the project off the ground. These loans are tied to the value of the land on which the property will be constructed. These funds can cover the site preparation, foundation, and ground floor of the structure. This type of funding is only meant for developers who have not yet used their land as collateral with another lender. While the low rate environment was a boom to business things are still busy with the fastest rate hikes in history.
Mezzanine Real Estate Financing
This is funding meant for projects that have already taken off and the developers have already used up all the money they borrowed against the value of their land. Mezzanine financing is an unsecured type of loan meant for projects that have already started and have reached the first floor. Alex Kleyner and the team usually assess the viability of a project to determine the maximum amount of money they can lend to the developer without exposing investors to unnecessary risks. This financing will help the developer finish up the construction works and prepare it in readiness for the market. In a bid to protect investor funds, ABK Capital has a team that will advise the property developer accordingly to ensure the project will be completed successfully.
ABK Capital also offers equity financing to property developers with projects that are nearing completion. The interest rates on all these loans are competitive. ABK Capital has always been successful in striking a balance between the need to keep investor funds safe and availing as much money as possible to real estate developers.
ABK Capital operates throughout Florida and has footprints across the country. This is due to the huge demand for real estate financing across the country. Ever since the market crashed in 2008, real estate developers have been having challenges securing affordable financing. Fortunately, ABK Capital is always willing to offer assistance.