Short-Term Rental Market Will Continue to Grow, Says Miami Developer

Catering to those who seek flexibility and convenience above anything else, the short-term rental sector has only been growing over the past few years. In South Florida, an area known to be a tourist magnet and a sought-after business destination, condo developers have been increasingly embracing the short-term rental model.

Rilea Group has been constructing condo towers across Miami since the 1980s. One of its latest development projects is The Rider, a 12-story high-rise with 146 residences in Wynwood that will allow both short- and long-term rentals, without any restrictions.

We asked Diego Ojeda, president of Rilea Group, to talk about the driving forces behind the short-term rental market in Miami and provide details about his company’s latest ventures into this growing sector.

What are the main reasons people look for short-term rentals today?

Ojeda: Renters can get a high-end hotel experience while enjoying the comforts of a residential unit with a full kitchen, separate bedrooms, bathrooms and amenities. It allows for a more live-work-play lifestyle that transcends a vacation spot. It is much more conducive to everyday life, while allowing the opportunity to explore exciting cities. 

Is the short-term rental sector still gaining momentum now that many employers have asked their employees to fully or partially return to the office?

Ojeda: While companies may be updating their return-to-office policies, the pandemic also spurred a new generation of entrepreneurs who work according to their own schedules.  

Short-term rentals go beyond offering a hotel alternative, now making for a viable and attractive investment, especially in major international cities like Miami. The beauty of it all is the flexibility. You can live in it full-time, part-time or simply rent it out at your convenience on Airbnb, VRBO or select building management programs. 

---

LISTEN TO: Podcast—Maximizing Multifamily NOI Through Flex Living

---

How does the short-term rental sector compare to the longer-term rental sector nowadays?

Ojeda: I think short-term rentals cater to modern-day jet setters and business people. The world has become increasingly connected and for those who envision a life that explores several locations throughout the year, a short-term rental is the perfect housing option for them. There’s less maintenance and more flexibility, not only in terms of usability but also monetarily. Having short-term renters often offsets the ownership costs of a residence. 

Location is also key. Our newest development in Miami, The Rider, is located in the heart of Wynwood, one of the city’s trendiest and most exciting neighborhoods. It’s also steps away from the upcoming high-speed railway stop, offering unrivaled connectivity to other Magic City neighborhoods, South Florida and beyond. 

How has The Rider’s location influenced the project’s design and offerings?

Ojeda: Proximity to the upcoming rail stop has certainly influenced the design, branding and offerings of The Rider. The development’s name is derived from the commuter train.

Being able to fly in, check into your unit and not have to worry about a car because you have access to various transportation options, from the train to rideshares and even a fleet of on-site Harley Davidsons for use, along with electric bikes and scooters, is an unrivaled luxury. Wynwood is also extremely walkable, offering world-class restaurants, retail and entertainment at your doorstep. It enhances connectivity and flexibility for every resident, owner or renter within the future building.  

How can developers and investors take a balanced approach to address community concerns while meeting short-term accommodation needs?

Ojeda: Concerns typically arise from short-term rental units that are located in buildings that also are home to long-term renters and resident owners. There’s a disparity in lifestyle demands. 

For developments curated with short-term rentals in mind, owners and neighbors have a clearer picture of what their living space will entail. Miami has done a good job of mapping out the areas in which short-term rentals can operate so there’s a distinctive and balanced approach. People can choose how and where they want to live. Also, tourism is a huge economic benefactor for the city’s economy and hospitality industry, so having the best of both worlds is important. 

Are there any other U.S. areas that have recently emerged as short-term rental hotspots?

Ojeda: Short-term rentals in trending second-home markets and vacation destinations are always going to perform well. 

Miami will always be a top short-term rental market due to its annual line-up of international events such as Art Basel, Formula 1 Miami Grand Prix, Ultra Music Festival, the South Beach Wine & Food Festival, in addition to the upcoming World Cup. The white-sand beaches, as well as top-tier entertainment and restaurant options also work to draw in year-round visitors. 

Growing markets such as Charleston, S.C.; Nashville, Tenn.; Tampa, Fla., and more, have also risen tremendously due to their entertainment and cultural offerings. 

Finally, what are your expectations for the short-term rental sector going forward?

Ojeda: I think it will continue growing as we, as humans, keep reevaluating how we live our lives. We are becoming increasingly global and are working more flexible hours. It’s likely we won’t be entirely stationary in one home or city our whole lives, like generations before. Short-term rentals allow buyers and renters the flexibility of everything, from ownership to travel. It’s a win-win for everyone participating.