MIAMI—Miami is not the only comeback city in Florida. With the CSX’s new Central Florida Intermodal Logistics Center (ILC) and Skanska’s Interstate 4 Ultimate project underway in Central Florida, there is plenty to talk about. Beyond infrastructure and logistics, the multifamily market is strong and the office market is rebounding.
Indeed, Orlando has plenty of bright spots to brag about. But there are also some sore spots remaining. GlobeSt.com caught up with Andrew Wright, CEO and managing partner of Franklin Street, to get his take on both. Wright will also be speaking at Central Florida RealShare Oct. 30.
GlobeSt.com: What economic drivers are leading Central Florida’s recovery?
Wright: Real estate development remains a big driver for Central Florida. New development and infrastructure projects are spurring some job creation for local contractors. Elevated transaction activity is also driving revenues for professional services throughout the state.
GlobeSt.com: What specific trends are you seeing in Central Florida that encourage you going into 2015?
Wright: Foreign investors continue to flock to Florida global uncertainty remains a concern contributing to economic and political volatility. Commercial real estate in the US is relatively stable, and we’ve experienced an influx of foreign money either currently investing or seeking to invest. Also, within the state as pricing in South Florida continues to rise for nearly all sectors of commercial real estate, investors are looking Central Florida for opportunities.
GlobeSt.com: What sore spots remain in Central Florida?
Wright: Construction costs are rising, which usually stalls new development. Finding skilled labor has also been an issue, as well as scarcity in necessary commodities.
Recently, we’ve had an uptick of new construction being delivered to the market, which is putting downward pressure on rents. Central Florida has experienced year-over-year rent growth since 2009, but that’s not sustainable in the future. We don’t expect to see a huge drop-off like during the recession, but we could definitely see it stall.