Boutique Near the Beach

Adagio Fort Lauderdale Beach may start going up this summer on the quiet side of the city’s barrier island.

By: 

Mike Seemuth

Published date: 

Aug. 1, 2017

Despite a deceleration in sales of new condos in South Florida, real estate development company Alco International Group expects to break ground this summer for construction of a boutique condominium along the Intracoastal in central Fort Lauderdale Beach. The 31-unit condominium, called Adagio Fort Lauderdale Beach, may open by the end of 2018. Adagio, a term referring to a slow part in a musical composition, also could describe the pokey pace of new-condo sales in South Florida.

Condo developers in Miami-Dade and Broward counties cumulatively have sold 19,326 of 23,220 units in the pre-construction phase of development, according to a May report by Aventura-based real estate brokerage International Sales Group, LLC (ISG). But developers sold only 212 units, or less than one percent of the units in South Florida’s condo construction pipeline, during the first three months of 2017, ISG reported. Separately, Dodge Data & Analytics reported that the value of residential construction projects that got underway in South Florida during the first quarter dropped to $1.27 billion from more than $2 billion during the same period last year – a reflection of the area’s pre-construction condo sales slowdown.

But even with unit prices averaging over $2 million, Adagio Fort Lauderdale Beach is well positioned to sidestep the slowdown. The 10-story project has an experienced developer behind it and a small scale that makes it easier to sell out than a high-rise condo. “It’s a little more difficult to market a big building. You have to be careful with this market,” says Leonardo Coll, the president of Alco International.

The 0.8-acre Adagio development site at 435 Bayshore Drive is part of a brand-name neighborhood. The angular waterfront site hugs the Intracoastal just north of a bend in Bayshore Drive, walking distance to the beach and such oceanfront destinations as The Residences at W Fort Lauderdale and the Hilton Fort Lauderdale Beach Resort. Under development just north of the Hilton on North Fort Lauderdale Beach Boulevard is the Four Seasons Hotel & Private Residences.

With its Adagio development, Alco International intends to maintain the luxurious standards of its well-known neighbors. Renowned South Florida design firm Interiors by Steven G. created the look inside the units and the common areas. The condo building is designed with spacious units (the smallest ones are 2,383 square feet) plus upscale finishes and top-of-the line appliances, and common-area amenities that include a six-slip marina and a rooftop swimming pool.

Pre-construction unit prices reflect Adagio’s rich design, ranging from $1.8 million to $4.5 million for penthouses. The minimum deposit is 40 percent of the purchase price, paid in installments. Atop a $25,000 reservation fee, pre-construction buyers are supposed to pay 15 percent when they sign a purchase contract, another 15 percent when construction starts, and 10 percent when construction crews finish the top floor of the building.

Recently there were reservations for 14 of the 31 Adagio units, or about 45 percent of the building. “We are trying to reach the 50 percent [reserved level] but, if not, we’re going to start construction anyway,” Coll says. Summer typically is a slow season for pre-construction condo sales, and “it’s a very season-dependent market … But we’re very happy with what happened in the last [winter selling] season.”

Still, times have changed in the condo business. Since early 2016, when Alco International paid $13.5 million for the Adagio development site, the descent in condo sales in South Florida has been especially deep in the Miami-area market, where once-plentiful foreign buyers have become scarce.

“Miami is a 100 percent different market. Fort Lauderdale is more local. It doesn’t depend on the international buyers as much as Miami,” Coll says. Pre-construction reservations of Adagio units have come mainly from residents of the Northeast who want a second home and empty-nester couples who want to unload large suburban homes in western Broward and move east.

Coll and his cohorts have been down this road before. They already have successfully developed a boutique condo in Fort Lauderdale bearing the Adagio brand. In 2015, Alco International finished construction of the 11-unit Adagio on the Bay condominium, at 1110 Seminole Dr, and sold out the waterfront development just west of Hugh Taylor Birch State Park at unit prices between $1.4 million and $1.7 million.

“We learned from Adagio on the Bay that you have to be very careful with the details, the quality of the building, the finishes,” Coll says. “That’s what sells.”

Over its 50-year history, Alco International has sold a lot. The company has built more than 15,000 residential units at developments in Florida, Panama and Venezuela, where Coll’s father started the family business, now headquartered near Port Everglades in Harbordale.

The company’s long track record has attracted both equity investors in its developments as well as lenders. “We have had conversations with a few banks” about borrowing to finance construction of Adagio Fort Lauderdale Beach, Coll says. Compared to years past, “they are a little bit more cautious, but I’m sure we’re not going to have any problem with that, because of all the experience we have.”