NAPLES, FL—How long will it take for Southwest Florida to flush out its distressed assets inventory? Where are the best opportunities?
We caught up with Jim Garinger, senior managing director and principal at Colliers International Southwest Florida, to get his insights on these and other distressed asset investment trends in the region. Be sure to go back and read part one of this article, “Distressed: Southwest Florida CRE Trends Emerge.”
GlobeSt.com: For how long will there still be availability of lender-owned/distressed assets in Southwest Florida?
Garinger: We expect the number of distressed properties in most asset classes in Southwest Florida to be significantly diminished in 2014. Multifamily has already seen the reset to new market values, and retail and industrial still have a few distressed assets available. Distressed office properties should be available until sometime in 2015.
GlobeSt.com: What are the best opportunities for investors to purchase distressed assets in Southwest Florida?
Garinger: I believe there are still many distressed land opportunities available. Lenders and special servicers still have distressed land assets coming through their systems. We have seen some really good properties sell at low prices over the past nine months.
With the other asset classes resetting to real market values, land will be the last to follow suit. That means land is going to be snapped up quickly in the near future, as investors take advantage of these low prices before they start pushing upward to the new market value levels.
GlobeSt.com: Which Southwest Florida submarkets have the least and the most distressed assets?
Garinger: Collier County was the first of Southwest Florida’s submarkets to improve after the downturn and subsequently has the fewest distressed assets available. On the other end of the spectrum, the Lehigh Acres submarket still has plenty of distressed assets available, in all asset classes.
However, remember the old adage about location and risk versus reward. Investors in the hardest hit markets will take the most risks, but may not reap the largest rewards.