Five years after the catastrophic collapse of the Champlain Towers South building in Surfside, Florida that claimed the lives of 98 people, the 1.8-acre beachfront site is slated for an ultra-luxury redevelopment called The Delmore, designed by the legendary Zaha Hadid Architects. Yet despite Miami-Dade County’s otherwise active luxury market, a convergence of financial, logistical, and social factors has led to not a single one of the planned 37 residences going into contract during the pre-sale phase. Here’s why: 

Upfront Costs 

The site was acquired by Dubai-based luxury developers DAMAC Properties at a court-ordered auction in 2022. DAMAC was the sole bidder, and paid $120 million in cash for the land, with the proceeds helping to fund an historic $1 billion settlement for the Champlain Towers survivors and victims’ families.

The primary reason vertical construction and sales have stalled is DAMAC’s struggle to secure the complex $1.5+ billion construction insurance package required for high-rise residential builds post-Surfside. In the wake of the 2021 collapse, underwriters drastically shifted how they evaluate risk on Florida’s coasts, and the developer’s lack of a local track record, combined with carriers’ tendency to heavily penalize residential condo projects has made it extremely difficult to lock down adequate coverage.    

Pricing has exacerbated the challenge. The boutique building is set to feature sweeping “mansions in the sky” ranging up to 15,000 square feet and starting at an astronomical $15 million, with penthouses featuring private, glass-fronted rooftop pools priced at more than $150 million—not exactly an impulse purchase, even for the super-rich. 

Finally, there’s the tragic history of the site itself. Though the ground itself is now geotechnically secure, the notion of living on the site of a mass-casualty event has likely given many prospective buyers pause. Local community members and victims’ families have also fiercely objected to the commercialization of the tragedy, with some openly accusing the project of having “blood on its hands” during intense town meetings, and even DAMAC executives themselves acknowledging that while they conducted exhaustive structural and financial due diligence, the site memorial dynamics demanded more “emotional due diligence” as well.

Where Things Stand

Along with missing the crucial winter sales season and facing a frozen project site, the Delmore developers also lost a $200 million multi-unit deal with a single buyer when the developer’s legal team could not verify the source of the buyer’s funds. As of now, DAMAC is actively searching for joint-venture partners to help navigate the challenging Florida market and get the project back on track.