Gaia Real Estate moved its headquarters from New York to Miami, as it focuses on investment in South Florida’s multifamily market.
The move comes after a slowdown of the influx of out-of-state companies to South Florida, which reached an apex in the three post-pandemic years. Gaia’s heightened investment in the Magic City also comes at a questionable time for the rental market.
Gaia established its base at 8163 Northeast Second Avenue, after first opening an office there early this year, according to the firm’s news release. It’s expanding at the site, where it’s leased a total of 5,000 square feet, with two new leases starting early next year.
The building is in Miami’s Little River neighborhood.
The firm wants to be closer to its “key markets,” Gaia CEO Danny Fishman said in the release, saying Miami has “the right momentum” for Gaia’s evolution.
Founded in 2009 by Fishman and Ken Woolley, Gaia so far has been based primarily in New York. Over the years, it has invested more than $4 billion in the residential market across more than 20,000 units.
It’s not ditching the Big Apple entirely, keeping an office at Carnegie Hall Tower, the release says. It has 35 staff members in New York, and 150 contracted employees at its property sites nationwide.
The Miami office will start out with 10 employees in January, and all new Gaia hiring will be here, according to the company. Some of the New York staff members will move to Miami or will work hybrid schedules between both offices.
In May, Gaia partnered with Miami-based Moderno Development Group to launch the first half of a $300 million investment fund to purchase and renovate or rebuild single-family homes and townhomes in South Florida. Through development and investment firm MILAS, which stands for Miami land and single-family, Gaia and Moderno plan to lease out all new homes that are part of the first phase.
Monthly rents will range from $4,000 to $7,000, Doron Broman, Moderno CEO, told The Real Deal in May.
Moderno, which also is based at 8163 Northeast Second Avenue, owns the building through an affiliate, according to records.
Separately from its Moderno partnership, Gaia also is focusing on value-add multifamily investments and also has a fully discretionary real estate investment trust for new multifamily properties in the Sun Belt, including in South Florida, the firm said.
The REIT has made roughly $300 million in investments in more than 1,000 units in Houston, Orlando and Nashville.
South Florida apartment leasing has slowed over the past years compared with the bonanza that ensued after the pandemic’s onset. At the time, New Yorkers, Californians and other out-of-staters created unprecedented demand and prompted record rent growth.
After developers seized the moment, they completed a record 18,600 units last year, outpacing 15,000 net new leases, according to CoStar Group. That led to slower lease-ups, more concessions and a drop in rents, though developers are continuing hefty multifamily construction.
In the year that ended Sept. 30, construction started on 14,515 apartments in South Florida, according to CoStar.
Still, Moderno and Gaia are focusing on single-family and townhome rentals, an asset class that Broman said in May has high demand and limited supply.
Gaia’s decision to move its headquarters to Miami also shows the influx of New York firms to South Florida may not be over. Companies rushed south from 2020 to 2022 due to the state’s early lifting of the lockdown and business-friendly climate, leasing big blocks of offices, though the migration had slowed in more recent years.
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