MIAMI-Eighty-five percent of the 23,628 condo and apartment units constructed in downtown Miami since 2003 are now occupied, according to an independent Residential Closings & Occupancy study commissioned by the Downtown Development Authority. That reflects a 31% increase since June 2009.

Conducted by Lewis Goodkin and Craig Werley of Goodkin Consulting/Focus Real Estate Advisors, the report signals a strong demand for urban living in Miami for the first time in the city’s history. According to the study, 78% of the condo units built during the building boom in the downtown Miami area have been sold. Unsold inventory in the downtown area has now fallen to roughly 4,960 units—a 40% drop since 2009. At the same time, average monthly leasing velocity has risen 7% in the past year.

“Sales and rental activity in Downtown Miami has outpaced even the most bullish projections,” says Lewis Goodkin of Goodkin Consulting. “Assuming these rates continue, Downtown’s remaining inventory could theoretically be sold-out within 26 months. This is quite remarkable considering that some analysts believed it would take nearly a decade to reach absorption.”

Total condo sales in Downtown Miami were up approximately 36% year-over-year from 2009 to 2010, with 3,780 units sold in 2010. Seventy-eight percent of the 22,439 condo units completed since 2003 have been sold. Meanwhile, average sales prices in 2010 were up in the fourth quarter and on a year-over-year basis. The average unit sales price in 2010 was $347,729, a 15% increase from the average price of $302,254 in 2009. Average condominium sales price per square foot in 2010 was up 10% to $300 per square foot.

In a sign of further market stabilization, Everglades on the Bay’s $142 million debt was purchased by Rockwood Capital Partners in the fourth quarter of 2010. The number of unoccupied new condos in the downtown area has fallen by more than 3,300 since May 2009.

Much of the sales activity taking place can be attributed to an infusion of capital from abroad. Investors from rebounding markets such as Brazil, Mexico, Colombia, and Argentina are increasingly viewing downtown Miami an attractive place to invest. According to residential broker Ron Shuffield, president of Esslinger-Wooten-Maxwell Realty, international buyers now account for roughly 60% of the sales taking place in Miami’s urban core.

“One of the most important outcomes of the residential occupancy boom is Downtown Miami’s newfound destination status and commercial growth,” says Alyce Robertson, executive director of the Miami DDA. “What was once considered a strict 9-to-5 employment district is now emerging as a vibrant 24-7 city filled with a wide array of culinary, entertainment, cultural and arts experiences. Downtown Miami has become an urban destination in its own right.”