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Business & Labor
The Passion and Vision of Jorge Perez
(southeast.construction.com, February 2006 issue)
By Scott
Judy
Jorge Perez is on an incredible run.
In 2005, he was listed as one of only
several from the construction and development fields on Forbes
magazine's most recent list of the richest Americans, Time
ranked him as one of the 25 most influential Hispanics in
the U.S. and Hispanic Business magazine ranked The Related
Group of Florida as the largest Hispanic-owned company in
the country, with reportedly more than $2 billion in sales
in 2004.
And now the South Florida "king
of condos" is looking to expand his empire, with huge
developments under way in Las Vegas and plans for others in
Atlanta and elsewhere.
Indeed, the CEO of The Related Group
of Florida may be on the cusp of proving himself - and his
multifamily and mixed-use development company - to be a worthy
successor to other great Florida builders before him, such
as Henry Flagler or Walt Disney.
Instead of his legacy, though, Perez
seems more focused on future opportunities, which may include
even pricier developments but also some "affordable"
or workforce housing for an increasingly squeezed-out middle
class.
"I really love creating cities,"
Perez said. "I love changing cities. I love changing
lifestyles."
Leading the Wave
Perez is certainly not just another
developer.
With roughly 27 years in the business,
he and his company are revered as the trend-setting multifamily
developer of the region - and Perez as someone who has helped
define the era.
His South Florida projects include the
latest ICON - ICON Brickell; One Miami; 50 Biscayne; and the
ultraluxury Apogee. And now he is building the sprawling $3
billion Las Ramblas mixed-use development in Las Vegas with
George Clooney and Rande Gerber.
"He's a visionary," said Taras
Diakiwski, business development manager for The Weitz Co.
in West Palm Beach, the contractor for just one of Related's
numerous projects. "He goes into areas where you would
typically see no development.
"For example, in downtown Miami,
where you saw nothing happening, he was the first who came
in. That place used to be dead at night. He started (One Miami)
and now everybody else is following the lead and there's one
crane after the next. He's the guy who will first go in there
and take the risk, because he sees it."
Robert M. Swedroe, a Miami Beach-based
architect who's designed for Perez and Related, added: "He
shares traits with some of our other visionary clients, like
the Soffers of Turnberry. He's on a fast track. He has made
a significant mark as a high-profile developer by building
a lot of projects simultaneously in key locations around the
country. He used to be the rental king and now he's the condo
king."
Joyce Bronson, senior vice president
with Related and a 20-year veteran of the real estate development
business, said she only knew of Perez before joining the firm
seven years ago.
"If there was one person I wanted
to work for in my career it was Jorge because I sensed the
energy and his dynamic leadership," she said. "He's
passionate about what he's doing and about his legacy and
contribution. He expects a great deal, and I think that's
good for all of us who work for him."
Related keeps a close circle of contractors
and subs building its projects. John Moriarty & Associates
of Hollywood, Fla., has been building for Related for about
10 years and has proven to be the firm's most popular choice.
James Palermo, senior vice president
with Moriarty, credited Related's success to the speed with
which it starts and builds a project.
"They have a well-oiled machine,"
he said. Whereas some developers can take up to 18 months
to get a condo project started, Palermo said, "Tom Daly
(with Related) has a penchant for getting a job going in six
months. Once they come into a project, they're totally committed.
"I've been in the business a long
time, and I've never been fortunate enough to have an ongoing
relationship like this with a developer. They've never failed
to live up to any of their promises."
Trend Setter
Perez prides himself on his company's
ability to set trends.
"We're at the forefront, nationally,
as to cutting-edge development," he said, adding that
various groups, such as the Urban Land Institute, regularly
seek out the firm's insights.
One of Related's biggest areas of influence
is that of urban renewal.
"We've been good at taking areas
that have been undeveloped or underdeveloped and seeing the
potential they have," Perez said.
He added that, despite being repeatedly
sought out by various entities to assist developing a particular
building, Related is not currently interested in single-structure
developments.
"It's very hard for just a single
building to have an impact," Perez said. "What we
are trying to look at (is) something that will allow us to
not only start with one building but also have other land
available to create a center where we can do a mixed-use development.
We're trying to do places where people can live and work and
shop within a very short distance."
Related wants to work on large, multiple-structure
developments that are nearly self-sustaining communities.
Bronson cited the award-winning City Place district Related
guided several years ago in helping transform an urban section
of West Palm Beach.
"We are expanding what we do and
City Place is another perfect example of crossing that line
of just being a residential developer," Bronson added.
"We are expanding as markets change."
Perez said residential "is a driver,
but we like to see restaurants and shops in the developments
we're doing. So as we leave South Florida and go into other
areas, almost every one of the developments we're looking
at is a mixed-use development - whether it's Las Vegas or
Atlanta or Jacksonville.
"To be successful in creating residential
communities, you need to provide the amenities that people
need. And people need (more than) a health club, pool and
a tennis court. We provide retail establishments and office
space and other types of uses that complement our residential
use and make it that much more viable."
The incorporation of hotel services
for condominium owners is another next step. For example,
one of the three towers of Icon Brickell will incorporate
a boutique hotel that will provide all of the apartments in
that tower with hotel services.
"What we really want to do is make
sure that the people who buy from us really have the easiest
possible life, and we provide the greatest comfort that we
can," Perez said.
Affordable Living
Perez, who started out building affordable
housing, is arguably one of the greatest beneficiaries of
the booming luxury market. But he still sees the lack of affordable
housing as the top issue for cities moving forward - and perhaps
another growing market for Related.
"That might be the single-biggest
issue facing cities today - how do we provide housing for
workers?" he said. "Cities are becoming the places
for either the very poor, who get their rent subsidized, or
the very rich. Few people can really afford $500,000 to $5
million condominiums So, are we defeating the purposes of
cities? Because if you can't afford (to live downtown), you're
not going to be close to your employment."
Perez said Related is working with different
cities on affordability programs to fill the market gap.
"If we could build apartments at
$300 per sq. ft. in downtown Miami, I'd sell them like hotcakes,"
he said. And, in fact, he has. A recent effort between Related
and the city of Miami allowed public workers first shot at
lofts selling in the $200-per-sq.-ft. range.
Perez said the units sold immediately.
Since then, land and construction prices have shot up so dramatically
that that price range is now history.
"We need to continue to work with
government to find those alternatives that will make some
of this housing available to the working folks," he added.
"Affordable housing is really disappearing, and we are
going to have a major problem. Prices have just driven up
to the point where the middle class is just totally cut out
of the housing market."
Expanding Empire
There are still plenty of luxury multifamily
and mixed-use offerings in Perez' sight, however.
For instance, Related is going through
the zoning processes now on an approximately 4-million-sq.-ft.,
mixed-use development in Atlanta's Buckhead area and is looking
at a development site in downtown Jacksonville for a mixed-use
project with luxury high-rise condos.
Building upon its successes already
in the Fort Myers area, Related is also looking at waterfront
developments in Tampa, Bradenton and Marco Island.
Again, Perez said it comes down to project
impact.
"We're looking at important developments,"
he said. "And we're only attracted to developments that
have a real impact on a city - and where we can establish
an ongoing presence."
In short, Perez is looking to build
a strong presence in Atlanta and elsewhere.
"We think Atlanta has a tremendous
future growth potential, so it was a place we felt we wanted
to be in a large way - not just doing a building, but sort
of re-creating what we've done here in South Florida,"
he said. "That's what our attempt is - to establish a
Related Company of Georgia or Atlanta."
But Perez still sees his home base of
South Florida as the strongest market for the long-term future.
"We very strongly feel that South
Florida is poised to be the highest-growing area in the country
over the next 20 years," he added. "I think the
immense demand that we have continues. There's going to be
a correction at some point (because) too much has been announced.
But once we get through that correction, we're going to have
another period of great growth. People want to come to Florida."
Click
here for the Interview with Jorge Perez
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