In August, The Astor Cos. reached a milestone when the Miami-based developer announced that the 199-unit Douglas Enclave project in its hometown had reached 95% leased.

The project, part of Astor’s attainable Enclave brand, spans a 1.1-acre city block and is located adjacent to a Coral Gables Trolley stop, allowing access to downtown Miami and Brickell. 

“Miami is a very diverse market,” Astor CEO Henry Torres told Multifamily Dive. “There are certain sections of town that are very rich and very expensive. And, just like any other major city, there are areas that are not. That’s where the blue-collar workers mainly live.”

Torres said his goal is to build safe, quality housing for these types of workers. “We provide them with a product that is very similar to what you see in [wealthy] Brickell,” Torres said. “Maybe it doesn’t have the same finishes, but we provide a good product.” 

Torres isn’t finished with Enclaves. Before the end of the year, he plans to begin construction on another attainable project — the 179-unit Havana Enclave. It's planning to start a third project, the 246-unit Flagler Enclave, in early 2025.

“These are under the Live Local Act,” Torres said. “It’s a version of workforce housing. The rent is restricted to 120% of area median income, and you get some concessions from the city.” 

Like many South Florida developers, Torres also plays at the higher end of the market by building condos. It is working on a number of for-sale projects, including ONE Fort Myers in the Downtown River District of Fort Myers and Merrick Manor, a 227-residence luxury building in Coral Gables.

Here, Torres talks with Multifamily Dive about land costs, government incentives in Florida and his ideal hold time for new construction.

This interview has been edited for brevity and clarity.

MULTIFAMILY DIVE: How can you shave costs off housing to make it more affordable to blue-collar workers and students?

HENRY TORRES: Because of the land where we build attainable housing, it's less expensive than other areas where we produce a higher-end product. It's a lot cheaper than living in Brickell. It's not rocket science. And the city also gives you some incentives and things like that.

What percentage of your cost is in the land?

In these areas where I build in Miami, it's usually about 20%.

What concessions do you get from localities under the Live Local Act?

They let you defer your impact fees for the city and also for the county. They give you special consideration when you're going through the permitting process. You go to the top of the stack. 

Does the building have to be 100% workforce?

The building doesn’t have to be 100% workforce. But if it's going to be workforce, I want the whole building workforce. I'd rather do it that way.

I do it 100% workforce, and it works out because your neighbors are on the same level. You're not looking at Jeff Bezos in one apartment and the guy who works for waste management in the other.

Are you finding other construction costs have come down?

They have backed off a little bit. When you start paying people more money, it's very difficult to backpedal. At one time, laborers working on construction sites were getting $18 an hour. Now, I can't find the labor for less than $25 to $28.

If I go back to 2020 or 2021, I’m looking at probably an increase of somewhere around 40% to 45% for some of these projects. The rents have gone up, but not 40% to 45%. 

If we put a building together and sold it, we would make 30% if everything turned out fine. Today, we're lucky to make anywhere from 15% to 18%.

How long do you usually hold your properties after construction?

I've sold things that are six months away from finalization, and I sold things that we held for years. 

You lease them up, stabilize them and get all the bugs out of the new construction because there are always things that come up, and you try to clean it up as best you can before you sell it so the next guy that comes in doesn't come in with a bunch of headaches. The finalization of construction always has headaches. People do things wrong. You’ve got to fix this and fix that. 

What kinds of concessions are you seeing in South Florida right now?

At one time during the early summer, there were a lot of concessions going on. But that tapered off. I’m also seeing promotions from new construction offering two months free.

We just did a study of 33 apartment buildings, and eight of them were given concessions. It's been consistent now for the past two or three months.

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