Tampa Bay Commercial Market Update
If any of you have been waiting with baited breath for part 2 and beyond of our series on selling multifamily properties I apologize. The good news is that I have been so busy with market activity that I have not had time to post, but I promise more is coming. It contains a wealth of information that comes from experience in real life deal making and property ownership.
Now for a brief update on the actual feel of the Tampa Bay Commercial Market:
In the past several months activity from buyers have increased by at least 50-75% over last years levels at this same time. The general consensus I get when I speak to buyers is that they are waiting for the market to stabilize before they invest. So the root of the problem is not a lack of capital or investment desire; the root is fear of the market caused by instability. Whether or not the recent drops in the Federal Funds rate have helped quell that feeling or not is uncertain. However, one thing is becoming more certain; the fact that buyers are once again ready to make actual purchases. This being said we are still seeing our fair share of ridiculous low ball, bottom-feeder offers. As many will tell you from experience, sometimes these low offers will be accepted but I do not believe Sellers in the current market feel their properties have bottomed out enough to start cutting loose their equity in a last ditch effort to simply be rid of their properties.
Another good sign for all investors is the availability of financing increasing. Local banks, conduit lenders and other funding sources were very tight fisted in past years with their underwriting and their desire to take on new projects in our local area but those fists are slowly opening. In the multifamily market many new sources of funding are opening up on both a local and national level.
The bottom line is the market is starting to stabilize at least in my opinion and by the end of the year buyers and sellers may be their closest to a meeting of the minds that they have been in the last 5 years. If that happens, it will be a great time for everyone.
I look forward to any comments or critiques you might have on the subject. A good dialogue is always welcome on this blog.
Peter J. Barnett, CCIM
