By Chris Cobb | Associate
Welcome back to the Big3 with CC, your weekly real estate investment source. Lately, we have seen something unusual in Pensacola, ice and snow. It does happen every once in a while, however when it does happen, it’s no less of a surprise. Despite the cold weather, the Southeast has been hot in terms of commercial real estate growth. Because of that, here are three markets in the Southeast that investors should pay attention to:
The main reason for the strong growth here is that the demand is outpacing the supply. In the Multifamily sector, developers constructed approximately 11,000 units in 2016 alone (according to brokerage firm Marcus & Millichap) and show no signs of slowing their pace. As a result, Atlanta’s strong multifamily fundamentals are attracting more interest from both domestic and foreign investors than ever before. The average effective rent is projected to climb 5%. The migration to Atlanta has also increased the labor pool of Atlanta which will translate into more potential development for office and industrial space.
The Bay Area (Tampa, Not San Fran)
Partnered with its neighbor St Petersburg, Tampa is Southwest Florida’s economic anchor with very active defense and security industries. Tampa also has a strong and growing financial sector, which is one of the reasons it is home to 10% of the nation’s Fortune 50 shared-services operations. Moody’s predicts that Tampa will continue to grow at the same pace as the rest of the United States with 2.1% annual growth year over year. The city does face some challenges in terms of public transport, however, The Tampa Bay Express, a program that will attempt to modernize its transportation and ferry services aims to make some serious gains.
The 305 (Miami)
If you have been to Miami or flown through, you may have noticed the smattering of new luxury high rise towers being built along the Atlantic Coast. But those are merely the tip of the iceberg. The three counties in the greater Miami area are home to approximately 6 million people. The population in Miami-Dade alone is expected to increase by 180,000 by 2020. Private capital dominated the CRE market over the past few years, with 70% of properties sold to private investors. However, CBRE researchers note that the flow of institutional capital into Miami’s apartment market surged in 2016 and accounts for 60% of investment sales in the local multifamily market thus far.
So, come on down to Florida and have a look. I guarantee it will be worth your time.
When it concerns real estate, invest yourself.