Case Study: 5725 SW 77 Ter

CASE STUDY: 5725 SW 77 TER –
Hidden Gem in South Miami

ASSIGNMENT:

A colleague sought assistance in locating a specific property for a family member: a small professional office in the highly desirable South Miami submarket.

CHALLENGES:

The target property type faced significant demand from small business owners, particularly those in medical fields such as ophthalmology, dentistry, and primary care. These businesses, typically owner-operated and stable in size, rarely change hands. Further investigation revealed a common practice of intergenerational transfer within families, further limiting the supply of available properties for newcomers.

The client had exhausted traditional search methods, including MLS, LoopNet, CoStar, and similar platforms, without success in identifying a suitable property.

In addition to the challenge of identifying the correct property and working with the seller. We had challenges with closing the deal because of tight financing during a turbulent time in 2023 where rates were rising at each fed meeting, and it was summer and “Because Miami” we ran into bottlenecks with insurance.

SOLUTION:

Recognizing that the ideal property would likely be off-market, we implemented a strategic approach:

1. Created a comprehensive database of South Miami and nearby Coral Gables properties with appropriate zoning and size requirements.
2. Conducted thorough research to obtain ownership details and contact information.
3. Systematically reached out to property owners, prioritizing locations closest to the potential buyer’s residence.
4. While not my challenge as I repped the sellers, the buyer’s agent (Rayza Perez) was able to secure temporary construction financing and builders insurance. This bridged the gap between purchase, renovation, and hurricane hardening of the property and permanent financing with an SBA loan.

RESULTS:

Initial outreach confirmed our hypothesis: most properties were held by family practices with long-term succession plans, making them unavailable for purchase.

A breakthrough came when we contacted a CPA office that had occupied their building for over three decades. While not actively considering selling, the owners acknowledged:

1. Significant appreciation in local property values since their initial purchase.
2. Increasing upkeep costs (repairs, insurance, and taxes).
3. Evolving business needs, with less reliance on in-person client meetings and a shift towards remote work.

These factors combined to create an opportunity for both parties. After extensive negotiations, we reached an agreement that:

1. Satisfied the seller’s price expectations.
2. Allowed for a 3-month post-sale occupancy, facilitating a smooth business transition.
3. Provided the buyer with assurance of a funded and closed deal.

LESSONS LEARNED:

1. Certain commercial property types rarely appear on public listings due to limited supply, high demand, or business considerations.
2. Proactive outreach to property owners can uncover opportunities for those considering changes in the near future (6-12 months).
3. Buyers must be prepared to offer competitive prices, as off-market sellers typically lack urgency or financial pressure to sell.
4. Good deals aren’t always advertised, but they are always negotiated.