For the past four years, the real estate team at the Berger Singerman law firm has been doing its own annual survey of local developers, brokers and investors to gauge market conditions. This year, 102 people responded to the survey, and 31% of respondents said they expect 2018 will be even more successful than 2017.
Partner Barry D. Lapides said that in general, real estate professionals are upbeat about the health of the economy, as well as the new federal tax law — its benefits for developers as well as its potential to drive buyers to Florida.
“The warehouse market is really hot right now,” he said. “Multifamily is going along really nicely … Building in the urban core, I don’t see that going away.”
Sixty-nine percent of the survey respondents believe that foreign investment in South Florida will remain at 2017 levels or increase. Oversupply and uncertainty of governmental policies were the biggest concerns, with 62% of respondents choosing those two matters as the most pressing issues facing the market.
One of the survey questions, reminiscent of the game show "Family Feud," asked what words people would ascribe to the South Florida market. “Competitive,” said 51.5%f respondents, “cautious,” said 33.7%, and “measured” and “opportunistic” were also chosen by about a third of respondents.
Berger Singerman handles various types of business law. This year, it arranged the $36M sale and lease-back of AvMed offices in Dadeland. It is currently representing Royal Caribbean on port redevelopment issues, and working on mixed-use projects in Broward, Palm Beach and Daytona Beach, plus a $100M hotel project, partners Marc Stephen Shuster and Jeffrey Margolis said.
As far as trends they are seeing in their practice, Shuster said businesses are opting to purchase industrial space instead of leasing it.
“It looks like the dollar is weakening," Shuster said. "Many of our investors, they’re more or less likely to come in depending on the dollar. I’m excited for that.”
“Refinancing is really low," Lapides said. "There’s a fair amount of equity in the market. We’re seeing more hard money loans ... These were good projects — residential, hotel — but they had to take high-interest loans. They were not able to get financing [otherwise].”
The partners all said that with the economy humming along and consumer confidence high, they were just as optimistic as their survey respondents.
“Where else do people put their money?" Shuster said. "There’s no reason to think, with the stock market as it is, that people won’t continue to keep a percentage in real estate. The U.S. and South Florida are top places to invest for good reason.”
See the survey results here.
