The Tampa Bay commercial real estate market continues a strong trend of positive growth. Although there were some big events near the end of 2017, such as Hurricane Irma in September, the Tampa Bay commercial real estate market performed remarkably. That’s still the case as we go through the summer of 2018. Tampa Bay enjoys a strong population growth as people seek to escape adverse seasonal climate conditions, as well as higher taxes.
What’s the Commercial Real Estate Market like in Tampa Bay?
The Tampa Bay area continues to perform as one of the top locations in the entire southeast. It does so because it’s a business-friendly environment and there is no state income tax. Not to mention, the weather, which boasts super mild winters. The Tampa Bay area added an astounding 30,6000 jobs over the past year, hitting a growth rate of 2.3 percent. So, it also boasts a low unemployment rate, which last fell by a whopping 90 basis points to decrease to 3.5 percent.
Following the 2008 financial crisis, the equities market has outperformed almost all expectations and has provided a boon for investors’ portfolios. But with higher rates on the horizon and multiple other signs pointing to a potential shift in the market cycle, investors may want to trim their allocations to equities and explore other investment opportunities. One sector that is attracting strong inflows right now is the U.S. commercial real estate (CRE) equity and debt markets.
Additionally, the area continues to attract startups in many industries. Plus, the University of South Florida and the University of Tampa, along with St. Petersburg College, also attract talent for many roles on their campuses. All of this means a higher and higher need for commercial real estate as demand outpaces supply.
3 Signs of a Strong Commercial Real Estate Market
Determining the status of a commercial real estate market is quite a challenge. Because there is no multiple listing service, like there is for residential real estate, the stats are a bit more difficult to track down. But, there are some general trends which help to identify the health of a commercial real estate market:
- Low and/or competitive interest rates. Although interest rates are indeed on the rise, they are only incrementally increasing. Which means people are still finding value in different propositions, such as refinancing, relocating, and more. Since interest rates are still low and affordable, businesses will continue to expand and that’s a plus for the local commercial real estate market.
- People continue to move into the area. Of course, the more people in a given area, the more need for housing and day-to-day living necessities. The dynamic created is one that greatly benefits commercial real estate and residents need housing and more.
- Good consumer confidence and low unemployment. The overall consumer confidence rate is steadily rising nationally. The same is happening right here and as wages rise and fewer and fewer people are unemployed, thanks to increased labor demand.
If you’d like to learn more about commercial real estate investment benefits and more about the selling process, please contact me.