Developer Al Adelson helped usher in West Palm Beach’s new era of high-end condo developments with the Bristol, a pre-pandemic building that proved buyers would pay $1,000 a square foot for units west of the Intracoastal Waterway.
Now Adelson is developing The Berkeley Palm Beach, a condo tower at 500 South Australian Avenue, on the western edge of Downtown West Palm Beach. With units priced at $2 million to $10 million, Adelson again is pushing the pricing envelope.
The following conversation has been edited for length and clarity.
Commercial Observer: I remember when you came to market with very aggressive pricing for the Bristol, and I was skeptical that it would sell. How did you know that price point was possible?
Al Adelson: I have been in Florida for 25 years. I observed the market very closely, and I did studies. I interviewed almost 100 different brokers from Palm Beach to West Palm Beach, and I got a very, very good understanding. I did a lot of research on the island, and I understand very well how those people who lived there – I lived there myself for a few years – think and feel.
I realized that there was a hardcore 20 percent of people who reside on Palm Beach Island who wouldn’t move off of it if you gave them something for nothing. You know, just dedicated to the island. Not only are they not bothered by the rules and regulations, they’re in favor of them — such as they have no high-rises allowed to be built above six stories.
They have thousands of units that are very old, and it’s almost impossible to tear something down and build new, because the cost of the land is so prohibitive. And there’s no chance to go high, so you don’t get to spread out your cost over a large number of units. So, therefore, I felt very strongly that West Palm would have an opportunity to pick up a whole bunch of units, and I put my money where my mouth was. I did the Bristol, and it became beyond phenomenally successful. I think it’s probably the most exclusive, nicest condo in South Florida, and probably rates up in the top five on the whole East Coast.
Your current project, the Berkeley, seems similar in that you’re bringing a higher price point to a location where those prices hadn’t existed.
Well, there’s no question that the Bristol is on the Intracoastal, and the Berkeley is on Clear Lake — which, while it is a lake, there are no boats, swimmers, jet skis, there’s never any type of vehicle of any kind or any individual that ever can use the lake, because it’s the water supply for West Palm Beach and Palm Beach Island. Clear Lake is called Clear Lake because there is absolutely nothing on it.
I knew that the only problem with West Palm Beach is traffic. There’s so much new development taking place in the West Palm Beach area that there’s absolutely a real traffic issue. Getting from the Intracoastal to I-95, you have to come across Okeechobee, and the traffic in season is terrible.
At this moment, the only other opportunity to get to 95 via Australian is across Banyan Avenue. I happen to know that Fern Street, which is right in the middle of Okeechobee and Banyan, has been approved to cross the railroad track to Australian.
Further, Vanderbilt University is building a graduate school right behind the Berkeley location, and basically one door down on Australian, Cleveland Clinic is building a 200-bed hospital. Stephen Ross is developing another high-rise residential project on Australian. It made this site just fantastic.
And all those changes are in the process of going on, as I’m now starting construction. And that’s why our sales really streamed up the last couple months, when everything I just told you became public knowledge. So I’m in love with this site. And we’ve sold a substantial amount of units, and we have started construction, so we’re very happy with the way things are going.
A substantial amount – can you say how many?
We’re over 20 percent sold.
Compare and contrast this project with the Bristol. Are you doing anything different for this building?
I’m trying to make it look a lot like the Bristol. But I’m trying to keep the cost substantially less than the Bristol. The services and the look and the interior floor plan will be equal to or nicer even than the Bristol.
There’s new products out that did not exist when I did the Bristol. For example, there’s a product called Dekton that is made in the United States. It looks and feels like marble, except it’s actually better than marble. You can pour red wine on Dekton and two days later wipe it up and there’ll be no stain. Whereas marble gets any red wine on it and it’s a real problem. So there are things like that that keep the cost down, but they look and function exactly the same as Italian marble.
Our amenities package, because of improvements in technology, we’re able to offer fantastic packages with a lower cost of installation. Sound systems cost less, magnificent sculptures cost less. So we’re trying to take advantage of all those that we possibly can.
I thought the boom would have run its course by now. What’s driving this ongoing boom in West Palm?
That’s a great question. I wish I could tell you for sure.
I have been in the industry 57 years. And I’m used to seeing up and down, up and down, over many years. But the truth of it is, if you look at Palm Beach County, it’s been going straight up. The prices of homes, the value of land, the number of people moving here, it’s just unbelievable. The state of Florida is just doing great.
The weather’s great. The taxes are less. I just think it’s a trend that, at this moment, I don’t see stopping. I mean, who knows the future? Nobody knows for sure. But based on what’s going on in New York and in California, I don’t see why people choose there over living in Florida, besides the weather, obviously. But our tax system, and our pro-friendly business atmosphere, I just think makes this one of the best states to live in.
Jeff Ostrowski can be reached at jostrowski@commercialobserver.com.
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