Miami condo developer sees "rough years" ahead

By Tom Brown

MIAMI (Reuters) - Miami condo builder Jorge Perez answered with a shrug of the shoulders and an uncharacteristic "who knows?" on Tuesday, when asked when he sees south Florida's overbuilt housing market finally hitting rock bottom.

Perez, the chief executive of privately held The Related Group, a leading south Florida developer, isn't known for acknowledging ignorance about the once-booming market that made him a billionaire.

But these are unusual and unsettling times, as the U.S. housing and mortgage crises continue unabated and foreclosure filings reach a record pace.

"We're not at that bottom yet," said Perez, venturing one of his few predictions in an interview with Reuters.

He spoke after announcing a new joint venture with Bermuda-based Orient-Express Hotels Ltd (OEH.N) for the development of three luxury properties in Miami Beach, Cartagena, Colombia; and Panama.

Miami's condo market has long been considered one of the most overpriced and overbuilt in the United States, with newly opened towers dotting the downtown skyline after a frenetic construction spree that continued well after the market peaked in late 2005.

Perez is loath to single out Miami or south Florida as a particular cause for concern, however, even though condo prices there are now thought to be teetering on the brink of collapse after holding up surprisingly well over the past year.

'PERFECT STORM'

Miami's problem is part of a larger one, Perez said, and one that could spell trouble ahead for U.S. real estate for a long time to come.

"It's going to be a couple of rough years," he said.

"In the United States, we're probably in one of the toughest real estate markets that we've seen in many, many, many years," said Perez.

"I keep on thinking of it as the perfect storm," he added, saying the U.S. real estate crisis was worse than many people ever imagined it would be.

"Real estate has been going down, but the financial sector has been going down, the economy has been going down, the equity markets have been going down. ... We are in some rough waters," Perez said.

Despite all the doom and gloom, Perez said he sees little room for further price erosion in the south Florida market.

And the goateed real estate mogul, sitting in the dining room of a tony waterfront restaurant that forms part of his Miami headquarters, indicated that Related Group is unlikely to book a loss for 2008.