Despite a few hurdles caused by Hurricane Irma, 2017 was a remarkably strong year for Tampa Bay.
A robust job market and continual population growth has made Tampa Bay one of the top markets in the Southeast.
The area added 30,600 jobs for a growth rate of 2.3 percent over the year and the unemployment rate in Tampa/Hillsborough County fell by 90 basis points to 3.5 percent. Companies have access to a highly educated labor pool and a constant stream of employees from universities such as the University of South Florida and University of Tampa.
The effects of the improving economy and job growth contributed to increasingly strong fundamentals in nearly all sectors of Tampa Bay area’s commercial real estate market, and it doesn’t look like the momentum will let up any time soon.
With 2018 now in full swing, we asked some of our top brokerage professionals what 2017’s strong performance means for the year ahead.
THE OVERALL OUTLOOK
1. “The Tampa real estate market had a lot of important factors working in its favor in 2017, from population and job growth to consumer and business spending to tourism and out-of-state investment. We continue to see substantial growth in urban areas, not only in downtown Tampa downtown St. Petersburg, but also in suburban markets like Westshore and Wesley Chapel. After 26 years here, I’m hard-pressed to think of another time when the market looked this good for Tampa Bay.” — Larry Richey, Florida Market Leader
2. “Tampa steamrolled through the fourth quarter 2017, with robust year-end activity across all asset classes. 2018 has begun in the same fashion with demand outpacing supply as the continued theme, highlighting what a great place Tampa is to live, work and play. “ — Scott Garlick, Tampa Managing Principal
3. “The office and industrial capital markets remain strong into 2018. The largest questions at this point are whether there will be enough product to meet investor demand and whether interest rate rise will impact yields.” — Rick Brugge, Executive Managing Director
4. “Tampa’s industrial market ended the year with a bang. As the fireworks went off on New Year’s Eve, we closed out the fourth quarter strong. It may not be “Bezos” big but the Tampa industrial sector certainly had a stellar 2017 that attracted interest from new-to-market tenants as well as developers. Key metrics remain solidly positive in 2018 and we’re ready another for a big year.” –– Julia Rettig, Director
5. “The land market for all products was strong in 2017 and remains strong in 2018. Demand is real, not financially engineered, and money is cheap, but not easy to get, all of which will prevent the overbuilding of the mid-2000s boom. Tampa’s population and job growth are driving this bus.” –– Bruce Erhardt, Executive Director
6. “Supported by population growth, employment growth and by rising income levels,
Tampa Bay’s retail market will remain robust in 2018, with rising rental rates, decreasing vacancy rates, strong positive absorption and minimal new construction.” — Patrick Berman, Manging Director
7. “The Tampa office market saw the perfect combination of tightening vacancies, strong demand, and rising rents in 2017 and the market is positioned for further growth in 2018. The fundamentals are finally in place to justify the cost of new office construction, so we expect to see several projects break ground this year.” — Ryan Reynolds, Director