While prices of Fort Lauderdale commercial properties have been pushed up in recent years, today’s buyers likely will not regret the investment in a decade, according to local real estate execs.
“No one really knows the direction of the market,” Franklin Street’s Greg Matus said at Bisnow’s Fort Lauderdale’s State of the Market event on Tuesday.
“History says we’ll have a downturn in 2018. But I think we’re heading for a double header or extra innings.”
He said the market is going through a shift, and it will be a different place in 10 years.
“The time to buy is now,” Matus said. “You’re going to look back 10 years from now and say to yourself, ‘I wish I didn’t get paralysis from analysis in South Florida and Fort Lauderdale. I should’ve bought now.’ There’s such a scarcity of product right now, you got to take action.”
EDENS vice president Nicole Shiman echoed Matus’ views on the area, adding that “money is chasing deals in a very aggressive way.”
“Every time an asset with a grocery anchor is listed,” she said, “it’s pretty unbelievable to see the interest from the buyer pool.”
EDENS prefers investing in value-add retail in high-growth, high-density urban areas with strong demographics that can be repositioned, she said. Still, Fort Lauderdale has its challenges.
IP Capital Partners co-founder Josh Procacci said REIT and institutional investors have been flooding the market for industrial buys, driving some prices up to points that did not make sense for his firm. He highlighted an unidentified FedEx crossdock facility that traded for more than $350/SF, “which in my mind is far north of replacement cost [and] starting to get into some really low cap rates.”
Fort Lauderdale Mayor Jack Seiler, in a keynote speech, said the city led the way in the state with job growth — adding 26,300 private sector jobs last year with a 4.4% unemployment rate — but there were 25,000 job openings still unfilled in Fort Lauderdale because of a skills gap.
“It is the biggest problem we are dealing with in this area,” Seiler said. He encouraged the public and private sectors to foster a talent base of workers who take vocational training versus going the college route. “It’s hard to find good, solid employees when you go out to market. There are so many great jobs out here in Fort Lauderdale that are non college jobs.”