Running a condominium developer requires myriad skills—market and submarket expertise, land acquisition prowess, financing know-how, and design sensibility, among other things. But if you’re Carlos Rosso, president of The Related Group’s condo division, you can add international political scientist and economist to the list of competencies.

Rosso says he monitors South American economies on an hourly basis. And if there’s a big election? He might be burning the midnight oil to decipher the results.

“There were elections yesterday in Argentina, and we’re trying to see how it’s going to affect us in here in Miami,” Rosso said during a phone call in August. “I think it’s not so much whether the candidate wins. It’s what policies are going to be in place as far as allowing people to buy outside or not buy outside the country.”

Why is Rosso so focused on South America? It’s simple: 90% of Related’s buyers come from other countries, with 80% hailing from below the equator. That means if an election in, say, Brazil makes it harder for people to get money out of the country and into real estate, Related could lose potential buyers. And, as the firm found out in 2008 and 2009, buyers can walk for many reasons. The last time that happened it left Related on the brink of extinction. Rosso is working to ensure that doesn’t happen again.

Back from the Brink

In 1979, Jorge Perez partnered with Stephen Ross (currently the Miami Dolphins owner and then-owner of the Related Group in New York) to form the Related Group's Florida operation.

Related’s early focus was affordable housing and renovating homes. But Perez’s developments grew more extravagant, with world-renowned designers such as Philippe Starck creating towers and collections of art and amenities. Consider Icon South Beach. The 290-unit project felt more like a hotel than a condo with a 40-foot-long reception desk enshrouded in white curtains; a lounge at the foot of a pink-hued glass wall encasing a fireplace; and a 24-foot golden urn-shaped coffee and tea area.

When the condo market collapsed in 2006, Related was easily the most exposed developer in Miami. It developed 24% of the 22,737 new condo units delivered or under construction in the downtown Miami area from 2003 to 2010, according to Florida research firm Condo Vultures. But, unlike many of the fly-by-night condo developers in the Sunshine State, Perez found a way out. He partnered with Lubert-Adler, a Philadelphia-based real estate private equity firm, to establish a $1 billion fund to buy distressed real estate assets, including its own.

And, his lenders showed mercy. “In 2008, we didn’t know whether we were going to have a company,” Rosso says. “We had $2.5 billion of debt and it took a lot of work and a lot convincing [with the banks].”

Enter Rosso

In 2010, while still recovering from the recession, Perez decided to appoint presidents of his condo, apartment, and affordable housing operations. South Florida apartment vet Steve Patterson was brought in to run the rental operation and Albert Milo Jr. took over affordable, which is Related’s Urban Development Group.

Given where the majority of Related’s buyers were coming from, the choice of Rosso to run the condo division makes sense. The MIT grad, who started as an assistant project manager in 2002, first met Perez when he was working on a thesis about flows of capital from South American pension funds.

Since then, Related’s rental business has grown, which provides a hedge against the volatile condo market. In 2005 and 2006, 100% of its starts were condos, compared with 45% in 2015.

Related is more diversified, but Jack McCabe, CEO of Deerfield Beach, Fla.–based McCabe Research & Consulting, says condos are still a big part of its business model. “Even though they’ve become more diversified and are doing more affordable apartment construction, they still have a tremendous amount of luxury condos underway,” he says.

More Restraint

As Rosso took the helm of Related’s condo division, the mid-2000s disaster wasn’t far behind. But he thinks he’s found a formula to weather any future disruptions.

For one thing, the company won’t be as exposed. In 2005, Related started 6,720 condos. In 2014, it started 1,937 unit. “It’s more measured and more spaced out this time,” Rosso says. “It’s not the same thing that was happening in 2006 where we had a lot of jobs and they were much bigger with a much different financial structure.”

Specifically, the company now requires a 50% payment before it sells a condo. Then a building must be 80% full before construction starts. But not all of that newfound restraint is being driven by Related. Just this year, buyers from 90 countries have purchased units from Related. With the ebbs and flows of international investment, banks want buyers to have more skin in the game. “Banks realize that it’s very difficult to measure demand in Miami,” Rosso says, because of the high number of international buyers. “I think they feel comfortable if they see a lot of cash ahead of their loan.”

Restraint isn’t just a buzzword in sales; it’s also a trend in design. Related is focused more on “substance,” according to Rosso, which might mean creating multiuse buildings.

“We are adding other types of uses, where they need to operationally work,” he says. “We’re doing hotels with condos. We’re doing restaurants with condos. Everything we are doing has a little more of an operational use.”