Exclusive: Related’s Jon Paul Pérez Talks About The Market, The Future, And His New Ritz-Carlton Brand Tower | Business Observer


When Jon Paul Pérez was a kid, no one ever had to ask him what he wanted to be when he grew up. It was evident. He wanted to be in real estate. He never thought of anything else.

His best childhood memories are going to visit properties with his father on Saturdays after football. His father, Jorge Pérez, was a booming real estate developer at the time.

Jon Paul Pérez got what he wanted.

Now 36, Pérez is president of Miami Related Group real estate development company. In this role, which he took on last year, he heads the family business and heads one of the state’s largest development companies. He oversees the company’s operations in several divisions, manages land acquisitions and helps find financing for large construction projects the company undertakes. Related currently has about $ 13 billion in development projects, including several in Tampa.

Jorge, a former Miami city planner, started the business in 1979 with a focus on affordable housing. Over the next 40 years, Related has built and managed over 100,000 condominium and apartment units around the world. Jorge Pérez is worth $ 1.7 billion, according to Forbes.

Despite the breadth and depth of his work, Jon Paul Pérez says Related remains a family business where conversations inevitably revolve around business when everyone gets together for a family meal once a week.

Pérez was in Tampa on October 13 for the opening of the sales gallery at the new Ritz-Carlton residences at 3101 Bayshore Blvd. When complete, the ultra-luxurious 27-story residential tower will feature 89 residences and 12 townhouse-style villas with floor plans ranging from 2,400 square feet to 11,000 square feet. Prices start at $ 1.6 million and peak at $ 5.1 million. Construction is expected to start at the end of the year and be completed in early 2024.

While in town, Pérez sat down with the Business Observer for a conversation about development, Related’s plans for Tampa and his future atop this great real estate company. Edited excerpts:

Tell me a bit about this project and what is Related Group doing to differentiate itself from other luxury developers?

We had always thought of Bayshore as the most luxurious place in Tampa. You just sit here and you look out the window and you have a wonderful view of the bay. You can see Harbor Island. You are two seconds from downtown. We saw that there was great potential. What we noticed in Tampa was that no one had ever really made a very well-made luxury product that we are proud to make. We have therefore brought the best in its category for each discipline. We said, let’s call in Arquitectonica, a world-class architect and designer. We brought in Meyer Davis from New York, a world famous interior designer. Enzo Enea from Switzerland, who is probably the best landscaper in the whole world. And then we said, what else can we add to this incredible mix of talents? And we said, let’s bring in the Ritz. And why the Ritz? Well, the Ritz is known as the best hotel service brand in the world. So not only do you have a design and amenities, but you also have that service and that touch, so when you get home you don’t really have to lift a finger. It truly is the height of luxury and quality. It was the goal. Build something special that Tampa has never seen and raise the bar – something we always try to do with every new project.

You have pre-sold about 50% of the project. What kind of marketing and outreach is the company doing to sell the rest and how is this new sales gallery helping?

The market has been very receptive to us. Tonight we are opening the sales gallery for the first time so people can see the finishes – the bathrooms, the kitchens and the quality of the product that we are going to deliver. Before that we were selling from our broker’s office up the street and even right around there people automatically assumed quality because you were bringing in from the Ritz-Carlton. Selling 50% in the last 60, 90 days without a sales center, we felt really good. We hope to sell in the next few months.

Affordable housing is a big part of the business model. Can you talk about some of the projects you are working on here and why affordable housing continues to be important?

In West River, we are working (on development) with the Tampa Housing Authority. We have completed approximately 450 units. This is affordable, workforce, mixed income housing, and we still have about 1,000 units in this partnership. This is where we really started. My father was from the city, he was a city planner and started in affordable housing because at the time there was very little equity needed so everything was funded by tax credits or grants from the city . He continued to do so for about 10 years and quickly became one of the largest developers of affordable housing in the country. He then moved to market-priced housing and then to condominiums. And what happened was that during the recession our only line of business was condominiums and there was no more condominium to develop or sell. What we have done is diversify the business and go back to our roots and create an affordable housing division. We have about 6,000 units under construction, of which about 2,000 are in Tampa and the rest in Orlando, down south. It is a great initiative of the company. We have the Rome Yard (Development Project), for which we have just won a tender. It’s 2,000 units next to West River. All mixed income. From the most affordable housing to the average housing.

Is this the future of affordable housing?

Yes. I think when you change from just affordable to affordable, 30 years from now you will have to do the same. So what we are trying to do is not just to create mixed income housing, but to bring businesses, retail businesses, so that there are economic opportunities for the people living in those neighborhoods. So that it is not just about housing. We firmly believe in mixing the different uses so that this is a neighborhood that can prosper and develop on its own with all the residents who live there.

In terms of development, how is Tampa different from Miami – from price per square foot to type of clientele? And do you see a way where they can be alike?

We are extremely optimistic about Tampa. We call it our second headquarters. It’s probably our biggest market outside of Miami. There are a lot of tech companies coming to Tampa, there are new companies coming to Tampa. You see big companies bringing talent with them and with high paying jobs. And their employees are going to need housing. Tampa is extremely pro-business, it’s a great city to do business, they want to see the city grow. The difference between Tampa and Miami is that you have different buyer pools. In this project, here, it is mainly the locals who buy. And the price hasn’t reached where Miami has gone. You have a waterfront property like this in Miami, you’re talking about $ 2,000 a square foot. Here we are approaching $ 1,000. I think there is a lot more room for price appreciation in Tampa. I think at some point they will be the same.

Do you see any similarities between the housing market in 2007 and 2008 and the current market? And when a market is as hot as this, what can you do to avoid the pitfalls?

There are a lot of differences between now and 2007. One of the biggest differences is the amount of leverage. Thus, funding from banks and other sources is not as high as in 2007. There was a high level of bank indebtedness which required developers and owners to bring in very little equity. Much of this growth has therefore been financed by debt. We require additional down payments from buyers. Before, in the 2007 cycle, it was a 20% down payment and people could also resell the unit before closing. So someone was buying a $ 2million unit, which they should never have bought, but assumed they could raise the money to deposit the deposit and then reverse that contract for more. Sometimes it would go from one buyer to the sixth buyer before it was time for the person to close. We don’t allow this, and buyers are investing real equity in the purchase during construction. And you have a lot more local buyers than investors.

You have been for about a year as president of the company. How have you changed during this time and what lessons have you learned? And does being the founder’s son make your job more difficult, more stimulating?

It was a lot of fun. I was doing a lot of the jobs I had before the announcement. My father is extremely involved. He’s still CEO and President, and he loves design, structuring deals and all the fun stuff. We execute the vision we see for the business and for the projects. What happened in South Florida is that we were the beneficiaries of COVID-19. It was a horrible thing, but it was a good thing for Florida. We were able to position the company with several projects to take advantage of the product for sale, the condominium product, the multi-family product, and affordable housing. We believe the future is bright and believe that over the next 40 years we will continue to build great neighborhoods.

And working as a family?

Look, there’s no escape, is there? My work and my personal life are almost the same thing. Whether I’m in the office or on the weekend having dinner at my dad’s house, you talk about personal things almost the same way you talk about business, because business is our life. It’s funny. There are obviously ups and downs, but I would say the highs outweigh the lows. I like real estate and development. My brother too. I never really thought about doing anything other than probably producing a movie just because it’s similar. Being a producer is like being a developer, isn’t it? You have the vision as a producer, you hire the architect or the director. You need to get the script. Then you have the talent. Then you need to get the funding. As a developer, you sort of have the vision and engage all the tools you need to create that vision. They are very similar type roles.

Is this something in your future?

Yes. For sure.

Where does this come from?

It’s like a cool thing to do. Imagine you are producing a movie that goes on Netflix or even in theaters. It’s a tough business, but it seems like something that would be an exciting and fun project one day.

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