"There would need to be huge cutbacks to impact the real estate market in Central Florida," says Robert W. Miller, senior vice president in the Orlando office of CB Richard Ellis Inc. "For example, there were more than 40,000 new jobs created in the Orlando area last year; unemployment is around 2.5% which is among the lowest in the state and the rest of the country--these facts help drive growth, especially in multifamily."

Miller, a multifamily sector specialist, remains bullish on the fundamentals. "As long as there is still low unemployment and positive job growth, the multifamily market should remain strong due to the influx of new renters to the market," he believes.

In the funding sector, however, corporate reductions are already having spinoff effects, Mark L. Findura, president of R.J. Twitty & CO. II Inc., an Orlando-based mortgage banking and real estate brokerage group, tells GlobeSt.com. "Clearly, cutbacks are of concern to everyone, including real estate developers and lenders," Findura says. Lenders, particularly, are asking for more data before doing a deal.

"We are required more than ever to provide additional in-depth analysis regarding the market base surrounding subject properties being financed and sold," Findura says. "This is especially apparent in areas that are heavily occupied by large users."

In specific markets with low unemployment, such as Orlando and Austin, "many marketing companies are putting a positive spin on the situation, indicating it is healthy for the local economy and a method of achieving a more balanced employment base," the broker says. "The verdict is still out on this type of thinking."

Consolidations and mergers of financial institutions especially are beginning to leave a trail of empty office space in some CBD markets, Findura says.

"Of greater concern in our Southeastern territory seems to be the ongoing consolidations of large banks and national/regional companies," the broker says. "In its simplest form, many significant bank mergers have left CBD office buildings without anchor tenants and data processing centers empty. This has required more in-depth underwriting of lease terms, backfill candidates and vacancy analysis."

Instant Insights /

Corporate Cutbacks Not Affecting Multifamily Market but Lenders Getting Selective

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