Commercial Property Pensacola / Gulf Coast
Gary Watson, CCIM
Gary Watson, CCIM
BLOG.COMMERCIALREALESTATEPENSACOLA.NET
The CRE Recovery Continues
CoStar.com has been such a great source for Commercial Real Estate Info. I found this today and am glad to hear some promising news. The following article is by Mark Heschmeyer:
Commercial real estate (CRE) fundamentals continued to strengthen in the second quarter of 2011, albeit at a much more moderate pace than the end of last year. The temperate recovery is consistent with global economic trends, which softened in the first half of the year in the face of the Japanese earthquake and the oil-price shock.
While the economy continues to face challenges - including a struggling housing market, anemic job growth, and federal and state fiscal pressures - economic growth is expected to pick up in the second half of the year as energy prices ease and global supply chains are restored. As the economy gathers momentum, the CRE recovery should also accelerate, according to Kevin White, a real estate strategist with CoStar.
Office Market Rebounds
Based on initial quarterly findings, office fundamentals continued to improve during the second quarter. Although demand was not as robust as previous quarters, the fact that supply additions hit a 10-year low helped to support the eight-basis-point decline in vacancy.
As was the case during the first quarter, preliminary second quarter absorption came in short of expectations, as continued macroeconomic uncertainty caused enough uneasiness among business owners for them to delay leasing decisions.
"The office market posted its fifth consecutive quarter of positive net absorption while speculative space under construction reached more than 9.8 million square feet," noted Chris Macke, senior real estate strategist for CoStar Group, in analyzing preliminary numbers. "Second quarter net absorption increased to more than 12 million square feet, a more than 39% increase from the previous quarter's net absorption of 8.7 million square feet."
"However, this level remains down from the robust fourth quarter net absorption rate of more than 24.8 million square feet," Macke said.
CoStar economists will broadcast full second quarter property reports later this month on www.costar.com.
CoStar utilizes a census methodology basing its national results on changes to the entire population of office buildings as opposed to the commonly used practice of sampling, which generates estimates of national results based on results for a portion of the larger markets. CoStar's national population of office buildings upon which its results are based includes more than 10 billion square feet of office properties and believes its research methodology presents the most complete picture of property market conditions across the country.
"We remain confident that strong absorption (at par with 2005 levels) awaits in the not-too-distant future," said Adrian Ponsen, a real estate economist with CoStar. "The most recent job numbers show financial activities employment bottoming out, and professional and business services (60% of office-using employment) growing faster than it did on average during 2005-'07. Combined with today's relatively cheap rents, this foreshadows rapid acceleration in office demand growth."
"Macroeconomic concerns (particularly surrounding the U.S. debt limit) may very well continue to weigh on business owner psychology and leasing during the third quarter. But most conditions necessary for an absorption recovery have already fallen into place," Ponsen said.
Retail: 8 Quarters of Positive Absorption
The recovery continues to push forward, but retailers have throttled back their rate of expansion. Net absorption has slowed to its lowest level since the first quarter of 2010, but weak supply growth has kept vacancies moving in the right direction, according to CoStar economist Ryan McCullough.
"The retail real estate market has now experienced eight quarters of positive net absorption, longer than the office or industrial markets, which have each experienced five consecutive quarters of positive net absorption," Macke said.
"Second quarter net absorption increased to 11.1 million square feet, 700,000 square feet, more than the previous quarter's net absorption of 10.4 million square feet," Macke said. "This however remains well below the robust fourth quarter net absorption rate of more than 26.5 million square feet."
The two-year average net absorption rate is 12.4 million square feet, he noted
"This slowdown should be no more than a temporary slump; an economic uptick in the second half of the year should be enough to stimulate retail sales and encourage retailers to become more aggressive with expansion plans. The construction pipeline is at its lowest level in many years and poses no immediate threat to fundamentals. Expect to see vacancy compression accelerate over the next several quarters," McCullough noted.
Industrial Market Held Back Slightly
The warehouse market continued to gradually improve in the second quarter. As modest demand growth met deliveries that are probably at a low for the cycle, vacancies continued to come in for the fifth consecutive quarter, said CoStar economist Shaw Lupton.
While most industrial indicators have improved markedly in the past year, housing starts remain oppressively low, and the economic events that took a bite out of growth in the first half of the year could continue to hold demand back in the near term, Lupton noted.
"Ultimately, economic expansion will result in a quickening of warehouse absorption. Deliveries are expected to inch up in the near term but should remain low relative to history until warehouse rents grow significantly next year, providing developers with the green light to build," Lupton said.
Things Are Looking UP!
I can't speak for my competitors and I can't explain it but man the phone is ringing.
It actually started prior to the November 2 elections. Companies are tired of sitting on the sidelines waiting to see what Washington is going to do. I think we all felt like something was about to happen....and it did! Now whether the Republicans can turn this 'boat' around is yet to be seen but the mood seems to be we are about to see some pro-business legislation and if we can get the banks to loan some money we might actually get out of this mess.
Commercial real estate is generally the last thing to recover but that's based on history....I think we're rewriting the rules....we'll just have to wait and see.
There are more good deals along the Gulf Coast including Mobile, Pensacola, Pace, Milton and Ft. Walton Beach than at any time since I've been in the business (34 yrs.). The whole Panhandle of Florida would explode if money were to free up.
So...if you're wondering what you should do....call a commercial real estate agent and make something happen. If you don't have a commercial agent.....call me. I'll take care of your needs in the Panhandle of Florida or anywhere in Alabama. If you need help anywhere else in the country contact me and I'll get you hooked up with the best agent in your market.
Gary Watson, CCIM
gwatson@ccim.net
850-232-7576
It actually started prior to the November 2 elections. Companies are tired of sitting on the sidelines waiting to see what Washington is going to do. I think we all felt like something was about to happen....and it did! Now whether the Republicans can turn this 'boat' around is yet to be seen but the mood seems to be we are about to see some pro-business legislation and if we can get the banks to loan some money we might actually get out of this mess.
Commercial real estate is generally the last thing to recover but that's based on history....I think we're rewriting the rules....we'll just have to wait and see.
There are more good deals along the Gulf Coast including Mobile, Pensacola, Pace, Milton and Ft. Walton Beach than at any time since I've been in the business (34 yrs.). The whole Panhandle of Florida would explode if money were to free up.
So...if you're wondering what you should do....call a commercial real estate agent and make something happen. If you don't have a commercial agent.....call me. I'll take care of your needs in the Panhandle of Florida or anywhere in Alabama. If you need help anywhere else in the country contact me and I'll get you hooked up with the best agent in your market.
Gary Watson, CCIM
gwatson@ccim.net
850-232-7576
More Failed Florida Banks
Who is Buying Troubled Banks in Florida?
Florida depositors are starting to see new names competing for their money, as the state's troubled banks are closed and sold by the Federal Deposit Insurance Corp. On Monday, TD Bank announced it would acquire the parent company of Mercantile Bank, adding 66 more branches in Florida. So far this year, the FDIC has arranged the takeover of 10 Florida-based banks, nearly as many as the 14 it auctioned all last year. Buyers are scooping up failed banks, because the FDIC shares in losses on their bad loans. Although losses can run into the billions, keeping the banks and running them would cost taxpayers even more, officials say.
(Florida Trend May 17, 2010)
Pensacola Beach Still Clean!
A beautiful Sunday afternoon and Pensacola Beach was hopping. Lines to get in restaurants......backed up traffic at the toll booths. Just another day in Paradise.....almost......
Yes it's true Florida is still clean though is was reported that 'tar balls' were washing up on the beach on Dauphin Island. Though what was seen on Pensacola Beach was quite normal, I can't help believing folks were trying to get in what might be the last weekend of the summer to enjoy the sugar white sands we've all come to love.
The only thing that looked out of place was a Coast Guard C-130 flying 50 feet above the surf......most likely looking for 'oil'.
Now.....we all sit back and wait to see how the pending disaster will impact the businesses, business owners and their employees of all the beachs. I think we have been holding our breath for 3 weeks and though we 'know' we're going to get hit we're hoping for a miracle. And we just might get one.....the wind has been blowing out of the north for 2 days......
On another note......commercial real estate activity seems to continue to increase and we're thankful for that. Don't hesitate to call if I can be of service. Gary Watson, CCIM 850-232-7576 / gwatson@ccim.net
Yes it's true Florida is still clean though is was reported that 'tar balls' were washing up on the beach on Dauphin Island. Though what was seen on Pensacola Beach was quite normal, I can't help believing folks were trying to get in what might be the last weekend of the summer to enjoy the sugar white sands we've all come to love.
The only thing that looked out of place was a Coast Guard C-130 flying 50 feet above the surf......most likely looking for 'oil'.
Now.....we all sit back and wait to see how the pending disaster will impact the businesses, business owners and their employees of all the beachs. I think we have been holding our breath for 3 weeks and though we 'know' we're going to get hit we're hoping for a miracle. And we just might get one.....the wind has been blowing out of the north for 2 days......
On another note......commercial real estate activity seems to continue to increase and we're thankful for that. Don't hesitate to call if I can be of service. Gary Watson, CCIM 850-232-7576 / gwatson@ccim.net
Oil Slick Approaches Mobile-Pensacola Beaches
From Dauphin Island to Panama City Beach, including Gulf Shores, Orange Beach, Perdido Key and Pensacola Beach the impact is being felt even though the oil slick has yet to touch shore. Vacationers from around the country are calling to cancel their visits to the Gulf Coast. There is no doubt Lousiana and Mississippi will also be impacted.
Though it's too early to know the full impact, it will be felt soon and sadly, most likely, for a long time. It's strange how something like this can effect so many aspects of our lives. Just think about: The fishing industry, the families who have fished, shrimped and gathered oysters for generations will be out of business. The banks that finance the fishing vessels. The seafood wholesalers. The restaurants who serve fresh local catches. The waitress who is either supporting her family or supporting herself (his self) while attending college. And yes the impact on creatures of the sea, small and large. The least of which is, our loss of enjoying good local fresh seafood which we all love to eat.
It could also impact the commercial real estate industry. Wholesalers operate out of warehouses. Restaurants owners own or lease their properties.....we could see troubled properties relative to the seafood industry coming at us soon. Like most tragedies these are the properties we hate to see, knowing the failed loans were completely out of the control of the borrowers. Much like the current economic 'tragedy' the job we do is somewhat lack luster.
If you wish to follow the local news regarding the oil slick click on the "WEAR-TV" RSS Feed on the left.
Though it's too early to know the full impact, it will be felt soon and sadly, most likely, for a long time. It's strange how something like this can effect so many aspects of our lives. Just think about: The fishing industry, the families who have fished, shrimped and gathered oysters for generations will be out of business. The banks that finance the fishing vessels. The seafood wholesalers. The restaurants who serve fresh local catches. The waitress who is either supporting her family or supporting herself (his self) while attending college. And yes the impact on creatures of the sea, small and large. The least of which is, our loss of enjoying good local fresh seafood which we all love to eat.
It could also impact the commercial real estate industry. Wholesalers operate out of warehouses. Restaurants owners own or lease their properties.....we could see troubled properties relative to the seafood industry coming at us soon. Like most tragedies these are the properties we hate to see, knowing the failed loans were completely out of the control of the borrowers. Much like the current economic 'tragedy' the job we do is somewhat lack luster.
If you wish to follow the local news regarding the oil slick click on the "WEAR-TV" RSS Feed on the left.
EXIT Realty NFI-Commercial Is Busy
After attending a breakfast last week here in Pensacola where Dennis Lockhart, President and CEO of the Atlanta Branch of the Federal Reserve Bank, spoke I think he was right. His comments were very insightful and encouraging. He says the national economy has started to 'turn around' and he sees signs in numerous sectors including real estate.
However, one of his and the Fed's concerns is deflation . He says we are teetering on the edge right now!
Starting mid March my phone started ringing. Everything from calls to lease office and retail to purchases of troubled strip centers to medical office buildings. Contracts are being written and negotiated.
It almost feels like 2007!!
Mr. Lockhart did say the recovery was going to be long and slow but it appears we've bounced off the bottom.
Gary Watson, CCIM is President of the Commercial Department of EXIT Realty NFI-Commercial. He can be reached at 850-232-7576 / gwatson@ccim.net
However, one of his and the Fed's concerns is deflation . He says we are teetering on the edge right now!
Starting mid March my phone started ringing. Everything from calls to lease office and retail to purchases of troubled strip centers to medical office buildings. Contracts are being written and negotiated.
It almost feels like 2007!!
Mr. Lockhart did say the recovery was going to be long and slow but it appears we've bounced off the bottom.
Gary Watson, CCIM is President of the Commercial Department of EXIT Realty NFI-Commercial. He can be reached at 850-232-7576 / gwatson@ccim.net
Commercial Real Estate-Pensacola
For some unknown reason the commercial market has picked up to the point it alsmost feels like the old days (prior to 2008).
About Me
Gary is a 36 year veteran of the Commercial Real Estate Industry. He has worked with large national companies like Ford Motor Co. and Murphy Oil USA to the local business expanding. He earned his CCIM (Certified Commercial Investment Member) Designation from the National Association of Realtors in 1997. He is licensed in Florida and Alabama. He is past President of the Pensacola Association of Realtors, past President of Pensacola Cordova Rotary. He served on the Board of Directors of The NW Florida Blood Services Foundation for several years as well as The Leaning Post Ranch (an equine therapy facility for handicapped kids and youth at risk).
