The Industrial Market In Tampa Bay

By Steven Silverman, Tampa Commercial Real Estate

We are moving out of the recession and the inventory of very low priced bank owned industrial owned space on the market is decreasing. While purchase prices are increasing for high quality product and  lease rates are improving, they are still low since there is still high vacancy.  As an example, in the industrial market in the airport area of Tampa we have a 15% vacancy rate which we have never seen before. In this market this represents at least a seven year supply of industrial space and it is definitely a tenant market. There is a plentiful supply of Class C space available which is  keeping rates down. Industrial warehouse space for lease can be found from three dollars a square foot. The high vacancy rate is inhibiting new development which will not come until there is a faster rate of  absorption.

There is a lot of talk about Amazon coming into Tampa Bay and setting up a 1,000,000 ft.² distribution center near Apollo Beach in Hillsborough County. The brokers and developers that I have spoken with feel that aside from increasing some demand for housing,  Amazon will not have a have a major positive impact on the traditional industrial real estate market. The reason for this is that  Amazon is self sufficient. They bring in inventory and ship it out very quickly. The will not have a gravitational effect in attracting suppliers.

In the longer term as our transportation improves, the Port of Tampa expands and the Panama Canal renovations are completed the industrial market in Tampa Bay will improve. For now we need to concentrate on absorbing existing space.

Steven Silverman is the Broker at Tampa Commercial Real Estate
www.TampaCommercialealEstate.com        steven@TampaCommercialRealestate.com

Sources-
http://sideeffectsofxarelto.org/xarelto-lawsuits/

For companies considering relocating or expanding to Florida, the investment in Commercial Real Estate is a major expense. These companies should be aware of the incentives that may be available to them.

In the wake of the past recession, Florida wants to increase employment. With each corporate relocation Florida is not only creating employment, but if the jobs are high paying then it also raises the per capita income.

With its sea ports, proximity to South America ,international airports low cost housing and business space plus the natural beauty. Florida already is appealing to many out-of-state companies as place seeking to expand or relocate . But government has realized that the appeal alone is not enough. The State of Florida, its Counties and the Cities are courting out of state companies to relocate and expand into to their area. They are offering financial incentives to enhance the appeal

As an example for the companies moving to Tampa Bay
Amazon is opening a $200 million distribution center in Hillsborough County which will create 1,000 jobs Amazon will receive local and state incentives for the 375 high paying jobs of approx. $1 million plus property tax reductions over seven years of $6.4 million
Briston Myers will open a new North America Capability Center in Brandon that will create 579 jobs. They will receive incentives of $2 million from Hillsborough County plus additional state incentives that will bring the total incentive package up to $6 million
In Clearwater, the city recently used incentives to convince General electric to relocate positions from New York. GE made a $49 million investment and relocated 263 jobs.

The incentives are not just being used to help out-of-state companies. Local companies are also benefiting.
As an example, Retail Process Engineering LLC is relocating its corporate headquarters from Tampa and has purchased an office building in Pasco County to serve as its new headquarters. The Pasco Economic Development Council is assisting with the relocation. The company is anticipating job creation incentives of $5,000 per job created, equal to a total of $80,000. It should be noted however that average wage of each job is more than $105,000 which is more than three times the average annual wage in the county ($32,161). That was why Pasco County was so aggressive in the incentive package that it offered. The local incentives was a major reason cited by the company for selecting Pasco County as its new home

However, the State and the local authorities are conservative. They won’t just give money away. There are certain criteria that any government authority will look at before offering incentives.
Industry: QTI is Florida’s Qualified Target Industry Program. Industries such as Information Technology, Aviation, Life Sciences and financial services are their prime targets.
Salary Level: QTI is targeting companies that will pay higher than average salaries
The number of Jobs – less than ten jobs will not usually merit any incentive package
Typically the government officials will want to understand the companies commitment. They will ask how much the company will invest in commercial real estate, and how much they will invest in equipment. They will also want a sense of the competition. What options other than Florida or the particular geographic area is the company considering. The incentives are usually performance based. They are given after the company has created the promised jobs

An important aspect for companies that are considering applying for an incentive package is that they do not sign a contract to purchase an Office Building or the purchase of an Industrial facility before meeting with the local Economic Development Councils and making a formal application for an incentive package. The company must create the atmosphere where the EDC competes for the company relocation or expansion and the jobs the company will bring. You want the county to offer their best package. Once a lease is signed for commercial real estate or commercial real estate is under contract or has been purchased in Florida, the State and local government know that the Buyer is already locked in. The company will move regardless, so there is no incentive to offer incentives. If you are considering a corporate relocation or expansion and think that you may qualify for incentives, then then we encourage our clients to make a visit to the local Economic Development Corporation one of the first stops that they make. We are more than happy to set this up meeting for our clients.

With careful planning and awareness of the inventive programs available the company that is considering moving or expanding into Florida can make a huge difference to its bottom line

The economy in Florida and Tampa is rebounding. After years of decline construction is once more taking place. Developers and property owners are once more trying to develop properties to their highest and best use. Commercial real estate development is occurring. Shopping centers are planned into new and larger redevelopments which swallow up adjacent land. Residential subdivisions are being contemplated for rural areas. There are competing interests for local residents who want to preserve their old way of life and developers who want to promote commerce. A particular homes for cash company in san diego, believes that the area they buy in is more suitable. There may also be opposition from the county who may feel that the proposed development does not meet their objectives for the community

The first factor that developers should consider is the long range plan for the community in which they seek to build.  It is much easier when a property is already zoned for the proposed use. Often, however, the land use must be changed to accommodate a particular development. Counties in Florida assign a “Future Use” to properties so that development can be planned and consistent.  The land use for a particular property can be changed but it is a lengthy process that requires consideration of the local community and approval of the Board Of Commissioners

With social media and the internet local communities are increasingly able to organize in opposition to a project that they do not feel fits with their community . Residents worry about environmental issues, increased traffic, noise, landscaping, architecture.  Sometimes they do not want to lose property to development that they have come to regard as a local play area. The local county is obligated to notify local residents by mail of new project applications and also put up public notices on the property.

Developers should take the local community very seriously.  As an example, eight large projects in Hillsborough County were shelved due to opposition. Developers need to be proactive and make sure that community understands what they are trying to achieve.  They should try to work with the community and explain how the project will benefit the community. Developing good will makes negotiation easier with neighborhood associations and local residents and to find common ground to reduce local opposition.

Developers need to factor in the sentiments of the community and understand the objectives of the local County when planning commercial real estate development.

Perspective On The Commercial Real Estate Market In Florida

Conventional wisdom is that commercial property follows the rooftops.  As a local economy grows, the  demand for  housing increases which in turn causes a rise in the price of residential real estate. Commercial real estate such as Office, Retail and Industrial will follow Residential  in order to cater to the growing economy. And vice-versa.  In a downturn, commercial real estate will follow residential real estate downwards like houses, building or apartments based in St Kilda, Melbourne some of them with big fences from AAA Fence and other facilities. if you require a st kilda apartment then make sure to call us now.

Recently, there has been strong housing growth in Florida. Homes have increased in value and for the first time in years new housing development is occurring. So conventional wisdom says that commercial real estate should follow the residential real estate upwards. recently, I was able to buy an amazing home in Louisville thanks to Family Reality.

The issue to examine is why the price of housing is increasing. A large part of this is due to the low interest rates which are making housing affordable again. Low interest rates and the return of banks to the lending market are also benefiting commercial real estate. We have seen more demand and increasing prices for commercial real estate because of this. In this respect it does seem that commercial real estate is indeed following residential real estate.  Yet as a broker, it does not seem that the increased demand for commercial real estate is as strong as the residential market is experiencing.

However, there is a new factor propelling the increase in values that we are seeing in the housing market. Institutional money . In the past Wall Street was a major factor in the real estate bubble because they supplied easy and risky mortgage financing . Now major investment companies are back in the housing market, buying thousands of single family homes. Their focus has been in struggling markets where they can achieve a low purchase price/sf . It is in these markets, where, as the supply of homes decreases that housing prices are now increasing the fastest.  The investment companies have become landlords and are using management companies to control their properties.  Some are doing it themselves. Blackstone, as an example has opened 14 offices throughout the country to serve the homes it has purchased. This is new territory. Purchasing houses for investment is not anything new but in the past the landlords were local investors.

The question is how will these institutional players affect the housing market.  Buy low and sell high. That is how institutional investors  operate. Their strategy is not a secret so we should not be surprised when it eventually happens.  We should not be complacent and assume that because they are buying houses now that they will want to stay in this market forever.  Some investment firms are stepping up their rate of investment in single family homes and continue to increase their presence in state like Florida and California. However, other investment firms have already taken first steps to cash out. Certain investment firms have filed to go public. Others have started to sell holdings.

Fitch ratings has warned that in certain areas where the rise in housing prices has been faster than the growth of local economies, housing markets could stall or even reverse.   Will commercial real estate follow again?

The danger for the housing market is that we are relying on the institutional  real estate investors to be rational. Because they are professionals, we make the assumption that they know what they are doing. We have been down that road before. Small moves by them can have a big impact on the market.

There are changes coming to the Florida real estate market. The low current interest rates cannot remain indefinitely. If the new pack of institutional investors act in an orderly manner at the time of disposition the market should hold. If they adopt a herd mentality at the first sign of an inevitable slowdown, and start to sell faster than the market can absorb, there could be a significant impact on the housing market. Housing prices will fall. This in turn will effect the commercial real estate in areas where the institutional funds have made the largest investments.   Good commercial properties will hold their value. When making a commercial real estate investment in today’s market, the quality of the property is more important than ever. This all can sometimes get a little confusing, so if youre planning on buying or selling a property, it’s always recommended that you get aid from a professional like https://southerncaliforniahomebuyers.com/san-diego/, they can help you get the most cash in your pocket when selling your home.

Steven Silverman – Broker

Tampa Commercial Real Estate

Tampa Commercial Real Estate is a member of the Florida Gulf Coast Commercial Assoc of Realtors. (FGCAR)

Each month members of the FGCAR hold several commercial property pitch sessions at different locations in the market

In January 2013 Steven Silverman, the broker at Tampa Commercial Real Estate hosted a FGCAR pitch session in Tampa at a property that is listed by Tampa Commercial Real Estate. The building is a free standing office located on W North A street across from Westshore Plaza

Hosting a property pitch session is a great way for a Broker to get exposure of a listing to other Brokers. Brokers that attend get to see the property and can talk with confidence about it to their clients..

At the property pitch sessions commercial real estate members of FGCAR exchange information about new properties on the market and market conditions. Affiliates such as Banks, Title Companies etc also attend the meetings and update the commercial real estate agents on their sector of the market. Members of FGCAR that attend the property pitch sessions keep their fingers on the pulse of the market.

Members of FGCAR have to conform to strict ethical standards. Clients that employ members of FGCAR to Sell, Purchase or Lease commercial property have a distinct advantage in the commercial real estate market place. They know that FGCAR members are serious about their business. An ABL facility is perfect if a business owner is trying to make their income grow. One of the first questions that should be asked of a broker when discussing a commercial real estate project in the Tampa Bay market is whether that broker is a member of FGCAR

What Is A Fair Annual Increase In the Rental Rate For A Commercial Lease?

As the recession hit Florida and foreclosures came onto the market, buyers with cash discovered that the Internet is a great place to find deals on commercial real estate. Many reasoned they can do this without a broker. Some believed that the less people involved in the deal the better and and thought that they could get a better deal by not having to pay real estate commission.
Most of that logic is misplaced.  Firstly, the Buyer usually does not pay the real estate commission. Nine times out of ten the bank that is the owner of the foreclosed property recognizes  the real estate commission as a cost of doing business and it is already included in the price. I firmly believe that it is mistake not to use the services of a local expert to help you make your decision. That may sound self serving because I am a real estate Broker. However,  since the brokers services are free to the Buyer, a good broker can help the Buyer avoid making a serious mistake.
Recently a prospect called me from California. They were working on the acquisition of a portfolio of properties.  They were interested in a property they had learned about in Tampa Bay that seemed like a very good deal. According to information they had received, the property was a partially finished 5,800 sf Day Care Center on 1.5 acres of land. What made this property interesting was that there were no Day Care centers close by to compete with this center.  The property was bank owned and very well priced, one time I wanted to sell house fast in Cleveland and the bank bought it from me intermediately, I guess the house was in good conditions.
They asked me to take a look at the property and give them an opinion of value. Google maps told me that I should set aside a few hours to get to the property and back. As the miles rolled away, I was, as usual,busy on my mobile  phone so I did not pay too much attention to the travel time. Under normal circumstances I would have become concerned as the road narrowed, traffic decreased and the landscape turned from houses to orange groves but I was not paying close attention. Besides, I had the address plugged into my trusty Garmin GPS which seldom lets me down.

I found the property without a problem and was able to report to the Buyer the good news that the structure had lots of natural daylight. Also it  was very peaceful.  The conclusion of my report to the Buyer was they not proceed with the acquisition.  One look at  the photo of the property and my reasons will be readily apparent.

As a Broker my advice to the client was to run, not walk. I hate to  see a client lose.  By giving honest advice and helping the client prosper, it will lead to more transactions down the road

As a Broker that is closely in touch with the local market, I have noticed that companies in the high tech sector seem to be growing the fastest.

Tampa Commercial real estate is pleased to have brought Savtira Corporation into the Tampa Bay market Savtiras “Cloud” platform is attracting global attention. They grew from zero employees at their Ybor City location in January 20 11 and will reach close to 100 films by the end of 2011. It is forecast  that they will reach 300 employees by the end of 2012.

Tampa Commercial Real estate is also pleased to have brought MH Labs  into the Tampa Bay area. It MetricHalo p will be relocating from New York and they purchased it office warehouse facility in safety of. MH labs is a high-tech supplier of sound systems and software to the music industry. Their clients include companies such as Apple, the Royal Philharmonic, the Summer Olympic Games and many recording studios and artists.

We were also pleased to find a freestanding building for Knowledge Accelerators. Knowledge Accelerators services client such as Microsoft and IBM with translation services so that they are manuals can be distributed worldwide

On October 28, 2011 the St. Petersburg Times wrote about a recent study of emerging trends in real estate which was just published I the Urban Land Institute and Price Waterhouse Coopers.

The report shows that there has been a definite improvement in the commercial real estate sector in Florida and in Tampa Bay.  The report is not saying that commercial real estate is again at the top of the market but it is clear that commercial real estate is no longer below ground level. The improvement has been assisted by price corrections as commercial real estate moved to adjust to the current market.

One of the better performers was Miami which ranked 17th and compared to other markets. Political instability has been driving foreign cash into investment opportunities in Miami. Overall the rankings for Florida as compared nationally with major metro areas were.

• Miami 17th
• Orlando 29th
•  Tampa Bay 33^rd
•  Jacksonville 40th.

At the bottom were Detroit, Cleveland and Las Vegas.

The report states that apartments are benefiting the most across the country and that it will still be slow going for investors in industrial properties, hotels, shopping centers and office buildings, at least until 2012. However, not all local brokers agree with the report. One leading national brokerage company that closely monitors local markets says that the report does not show all the games made during 2011. His analysis shows that vacancy rates have decreased in industrial and office buildings. An example given was the decision by Time Warner to create 500 new jobs in the Hillsborough County over the next five years.

Source: Gulf Coast Busniess Review