Bloomberg

The Design District, set in the middle of urban sprawl, now ranks among the priciest US retail destinations.

In the middle of Miami’s urban sprawl, gritty underpasses and highway knots there’s an 18-block oasis for the uber-rich.

Glossy storefronts in shades of white feature the luxury brands favored by Miami’s moneyed class. There’s Hermes for cashmere suits and banker ties. A Chanel boutique for the latest iteration of the 2.55 bag. A Michelin-starred French restaurant featuring a $295 tasting menu. Those wanting to shed the foie gras pounds can call on doctors at a “biohacking” institute. Security guards in khaki shirts keep order by patrolling the streets.

Miles from South Beach’s glitz and Palm Beach’s old-money milieu, Miami’s Design District is one of the most distinct testaments to the wealth transforming South Florida. More than an outdoor mall, its developers pitch it as a neighborhood dedicated to art and architecture, as well as fashion and food. That’s helped vault it to the ranks of the most expensive shopping destinations in the country.

The Design District’s retail rents surged 67% to $500 a square foot last year, according to brokerage Cushman & Wakefield. That was the biggest increase among high-end shopping areas in the Americas. The district is now No. 5 on the real estate firm’s ranking of the priciest US retail streets, up from No. 11 the prior year.

Visitors can find Michelin-starred restaurants, luxury fashion brands, and public art works in Miami's Design District.

“Miami has grown, and we’ve also done something that, at least so far — and I’m not arrogant about it — more and more people appreciate all the time,” said Craig Robins, chief executive officer of Design District co-owner Dacra. He began accumulating buildings in the area in the late 1990s, transforming a patch of largely abandoned furniture showrooms that were “unrenovated and a dump,” he said.

Now, he’s one of the developers who have been able to ride Miami’s boom, which was supercharged after a pandemic-fueled influx of wealthy residents from financiers to tech investors and crypto traders. The Design District’s success has led to plans for a condo building, luxury hotel and new offices, with private equity firm Thoma Bravo among those considering taking space.

Robins estimates that he paid around $15 million for about half of the Design District. The last notable sale in the area was in 2023, when yoga retailer Alo bought its unit for $22 million, or $4,400 a square foot. Based on the district’s roughly 1 million square feet, that suggests the entire property would have a valuation of around $4 billion, which is “as good an estimate as you’re going to get,” said Jorge Portela, senior director in the Miami office of Jones Lang LaSalle Inc.

“The Design District is an outlier because it came from nothing and attracted some of the best brands in the world,” he said. “This corresponds to Miami’s rise as a top-tier global city.”

The area also exemplifies the potential for economic turmoil. The ultra-high-end products sold by the Design District’s retailers are among those that stand to be hit hardest by the Trump administration’s tariffs. Shares of luxury bellwether LVMH Moët Hennessy Louis Vuitton SE, the Paris-based owner of brands such as Louis Vuitton, Tiffany and Christian Dior, plunged last month after the company reported weaker-than-expected sales. And stock-market turmoil stands to hit the portfolios of Miami’s ultrarich.

Robins said the Design District has little debt, giving its developers the ability to ride out downturns and relatively high interest rates.

“There’s a lot of uncertainty right now, which I think makes everyone concerned,” Robins said, speaking of the broader economy. He has little concern about the effects on his own property, noting there are always “up times and down times.”

Robins has been building the area into a design mecca since the 2000s, when he enlisted the likes of Zaha Hadid and Marc Newson to provide installations. Back then, Miami had just one luxury shopping mall: Bal Harbour Shops, at the tip of Miami Beach. The Design District offered more choice and also bigger spaces, which allowed brands to get more creative.

Bal Harbour itself is set to expand by 50% to 600,000 square feet next year, further testament to Miami’s luxury-shopping demand. The additional units will also be as much as four times bigger than the typical store size at the center a decade ago.

“Miami is one of those markets coming out of Covid that just sort of caught fire and never really stopped,” said Matthew Whitman Lazenby, CEO of Whitman Family Development, which owns Bal Harbour Shops. “I think that stores are looking to invest in this market.”

Today the Design District is owned by Dacra, Brookfield Properties and private equity firm L Catterton. Kevin McCrain, head of retail for Brookfield Asset Management Inc., said his “team recognized the potential for this property and believed in its vision.” Brookfield, which first invested in 2014, now holds a 22% stake.

The owners make it as easy as possible for people to visit. Parking is cheap: $3 for four hours or $5 for a valet. Drivers enter via the Museum Garage, covered in white blobs and graphic pink shapes, or City View garage, evocative of an aluminum tin with a pattern of cut out diamond shapes. Far from being an eyesore, the carparks are some of the most architecturally striking buildings there.

Jeff Zalaznick, co-founder of Major Food Group, which has three venues and offices in the Design District, said it’s the best neighborhood in Miami.

“It stands for progress and luxury,” he said, speaking from the dining room of his private members’ club ZZs in the district. “It’s where Miami is headed.”

International and local artists and designers are featured throughout the Design District, from museums to galleries to public art works.

Two office buildings are in the works. In a few months, Robins is planning to start construction of a block of rental apartments. And over the coming years, he’s expanding 15 blocks west, backed by partners, to build a high-end condo tower, additional shops and a 100-room, five-star hotel by the Maybourne Hotel Group.

For artists commissioned to do work in the Design District, the open-air format in a city known for its private islands and gated communities is particularly rewarding. Nicole Moyo, an artist and urban planner who recently moved to South Florida from Toronto, said “being equally accessible to anybody is really the magic of it.”

Her jewelry-themed art display, “Pearl Jam,” includes large patterned beads and “earrings” hanging off a tree, honoring indigenous Ndebele women from Southern Africa who make earrings themselves. The work cost $180,000 to make and Moyo was paid a commission after winning the Design District’s Thanksgiving competition.

“We didn’t want in any way to be a luxury ghetto,” Robins said. “We wanted to be a creative neighborhood.”

See media coverage at Bloomberg.