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Survey of Emerging Market Conditions

Warrington College of Business Administration

Survey of Emerging Market Conditions

Quarter 2 2014

Published September 2014

Lead Researcher

Dr. Wayne R. Archer, Executive DirectorUniversity of Florida Bergstrom Center for Real Estate Studies

Professor of Real EstateWarrington College of Business Administration

Researcher and Analyst

Timothy S. Becker, CCIM, DirectorUniversity of Florida Bergstrom Center for Real Estate Studies

Editorial Board

Mr. Lewis Goodkin, PresidentGoodkin Consulting, Miami, FL

Dr. Hank Fishkind, PresidentFishkind & Associates, Inc., Orlando, FL

Mr. Jeff Conn, Principal

The Survey of Emerging Market Conditions is provided to all invited survey respondents who completed the survey during

the July 2014 fielding. For more information about the survey or the Bergstrom Center for Real Estate Studies, visit our

website at realestate.ufl.edu

Table of Contents

Executive Summary & Conclusions ............5Highlights ..................................................................................5The Survey.................................................................................6General Investment Outlook .................................................6Single Family & Condominium Development ...................6Apartments ................................................................................6Industrial ...................................................................................6Office .........................................................................................6Retail ...........................................................................................6Land Investment ......................................................................6Capital Availability ..................................................................7UF Commercial Real Estate Sentiment Index ..................7

Section 1: Investment Outlook ....................8

Section 2: Residential Development ...........8Expected Absorption Rates ..................................................8Expected Price Changes .......................................................9Investment Outlook ...............................................................9

Section 3: Apartments .................................. 9Expected Occupancy .............................................................9Expected Rental Rates ........................................................10Investment Outlook .............................................................10Cap Rates ...............................................................................10Yields ...................................................................................... 11

Section 4: Industrial .................................... 12Expected Occupancy ...........................................................12Expected Rental Rates .......................................................12Investment Outlook ..............................................................12Cap Rates ............................................................................... 13Yields ..................................................................................... 13

Section 5: Office ............................................ 14Expected Occupancy ...........................................................14Expected Rental Rates ........................................................14Investment Outlook .............................................................14Cap Rates ................................................................................15Yields .......................................................................................16

Section 6: Retail ............................................16Expected Occupancy ...........................................................16Expected Rental Rates ......................................................... 17Investment Outlook ............................................................. 17Cap Rates ...............................................................................18Yields ........................................................................................18

Section 7: Outlook for Investment in Undeveloped Land .......................................19

Land Without Entitlements or with Residential Entitlements ..........................................................................19Land with Office or Retail Entitlements .........................19Land with Hospitality Entitlements ................................19Land with Entitlements for Warehouse or R&D ........... 20Land for Urban Renewal ..................................................... 20

Section 8: Business and Capital Availability Outlook ................................... 20

Capital Availability ............................................................... 20UF Commercial Real Estate ...............................................21Sentiment Index .....................................................................21

Section 9: Dominant Investors .................22

Section 10: Characteristics of Survey Respondents ..................................................22

Profession of Respondents ................................................. 22Markets of Familiarity ......................................................... 23Property types of Familiarity ............................................. 23

Section 11: Details of Cap Rates, Yields and Expected Changes ............................... 24

Section 12: Local Markets ......................... 26

Regional Market Report for Dade ............27Multi-Family Properties ...................................................... 27Industrial Properties ............................................................ 28Office Properties ................................................................... 29Retail Properties ................................................................... 30

Regional Market Report for Broward .... 31Multi-Family Properties ......................................................31Industrial Properties ........................................................... 32Office Properties .................................................................. 33Retail Properties ..................................................................34

Regional Market Report for Palm Beach .........................................................................35

Multi-Family Properties ..................................................... 35Industrial Properties ........................................................... 36Office Properties .................................................................. 37Retail Properties .................................................................. 38

Regional Market Report for Treasure Coast ............................................................ 39

Multi-Family Properties ..................................................... 39Industrial Properties ...........................................................40Office Properties .................................................................. 41Retail Properties ..................................................................42

Regional Market Report for Southwest Coast ............................................................ 43

Multi-Family Properties .....................................................43Industrial Properties ...........................................................44Office Properties ..................................................................45Retail Properties ..................................................................46

Regional Market Report for Daytona Beach ..............................................................47

Multi-Family Properties .....................................................47Industrial Properties ...........................................................48Office Properties ..................................................................49Retail Properties ..................................................................50

Regional Market Report for Orlando ..... 51Multi-Family Properties ......................................................51Industrial Properties ........................................................... 52Office Properties .................................................................. 53Retail Properties ..................................................................54

Regional Market Report for Lakeland....55Multi-Family Properties ..................................................... 55Industrial Properties ........................................................... 56Office Properties .................................................................. 57Retail Properties .................................................................. 58

Regional Market Report for Tampa ....... 59Multi-Family Properties ..................................................... 59Industrial Properties ...........................................................60Office Properties ...................................................................61Retail Properties ..................................................................62

Regional Market Report for Sarasota ... 63Multi-Family Properties ..................................................... 63Industrial Properties ...........................................................64Office Properties .................................................................. 65Retail Properties ..................................................................66

Regional Market Report for Jacksonville .........................................................................67

Multi-Family Properties ..................................................... 67Industrial Properties ...........................................................68Office Properties ..................................................................69Retail Properties ..................................................................70

Regional Market Report for Gainesville/Ocala .............................................................. 71

Multi-Family Properties ......................................................71Industrial Properties ........................................................... 72Office Properties .................................................................. 73Retail Properties .................................................................. 74

Regional Market Report for Tallahassee/Panhandle .....................................................75

Multi-Family Properties ..................................................... 75Industrial Properties ........................................................... 76Office Properties .................................................................. 77Retail Properties .................................................................. 78

Executive Summary & Conclusions

Florida’s real estate practitioners remain optimistic about the state’s real estate markets. UF’s Commercial Real Estate Sentiment Index, an outlook of our respon-dents’ own businesses, improved to its highest level since the fourth quarter of 2006. Their optimism continues to be driven by the improv-ing Florida economy and the improving job market. The overall Florida unemployment rate declined slightly to 6.2% this quarter with overall Florida employment reaching 7.8 million jobs. The overall employment represents an increase of almost 240,000 new jobs from the same period last year. Additional-ly, those new jobs are spread across a number of the employment sectors with Trade, Transportation and Utilities; Professional and Business Services; Construc-tion; and Leisure and Hospitality leading the way.The increase in employment for hospitality is being driven by record tourism. According to Visit Florida, the state continues to see record setting levels of tour-ism with total visitation up 3% from the 2nd quarter of 2013 at 24.0 million visitors. Florida continues to see growth in overseas visitation, which is up 4% over a record setting 2013.The continued improvement in the job market along with tremendous growth in the tourism industry has been positive for consumer confidence. The UF Bureau of Economic and Business Research (BEBR) consumer sentiment index remained at post-recession highs this quarter at 82. However, uncertainty continues to play a part in tem-pering that improvement. The uncertainty created by government policy and inaction continues to prevent companies from moving forward aggressively with expansion. Our respondents continue to be concerned about the impact and timing of the Fed’s forthcoming increases in interest rates. However, despite that concern, the rate on the 10 year treasury remains low and declined 20 basis points from the end of the first quarter. A mea-sured increase by the Federal Reserve would allow real estate markets to absorb the increases through com-

pression of the historically high spreads between cap rates and the 10 year yield. Additionally, the increased interest rates may be offset by improving rents and net operating incomes.

Despite the uncertainties, Florida’s economy and therefore the real estate markets continue to improve and that trend should continue.

HIGHLIGHTS• The UF Commercial Real Estate Sentiment Index

increased this quarter to its highest level since the 4th quarter of 2006.

• The outlook for occupancy and rents remained positive across most property types with expecta-tions that they will increase.

• Cap rates remained stable or declined slightly across most property types. However, with increas-ing interest rates, expectations are for a rise in cap rates over the next year.

• Yields have remained relatively stable across most property types. As with cap rates, rising interest rates are pushing expectations for higher yields across property types.

• The outlook for investment remained positive across all property types.

• Respondents’ outlook for capital availability re-mained stable this quarter with most expecting it to increase in the future.

THE SURVEYOur quarterly survey, conducted by the Bergstrom Center for Real Estate Studies, Warrington College of Business Administration, University of Florida is in its thirty-second fielding. The total number of partici-pants, at 73, is the most extensive survey of Florida pro-fessional real estate analysts and investors conducted on an ongoing basis. It includes respondents represent-ing thirteen urban regions of the state and up to fifteen property types.

GENERAL INVESTMENT OUTLOOKOur general index of real estate investment outlook, weighted 40 percent for single family and condo de-velopment, 40 percent for apartments and commercial rental property and 20 percent for developable land, improved this quarter close to a survey high. Most re-spondents continue believe it is a good time to invest in Florida real estate and land continues to improve as an investment alternative.

SINGLE FAMILY & CONDOMINIUM DEVELOPMENTThe outlook for new single family development re-mained remains positive. Florida continues to have positive population growth and employment growth which is driving demand for new homes. Extreme win-ter conditions prompt more people to consider Florida, particularly retirees or near retirees. However, higher interest rates, declining incomes and higher land prices will dampen optimism slightly in this sector.

APARTMENTSThe outlook for multi-family properties continues to be positive. After many quarters of increasing occupany, respondents believe that occupancy will level off with the addition of new inventory. However, they remain optimistic that rents will rise with inflation. Cap rates remained steady this quarter with more respondents believing they will increase in the next year.

INDUSTRIALThe outlook for investment in industrial properties declined again this quarter from its peak in the first quarter but remains positive. Rents and occupancy are expected to increase in coming quarters. Cap rates and yields increased sharply for Flex Space and decreased slightly for Warehouse. Respondents expect rates to remain relatively stable in future quarters for both industrial sectors.

OFFICE The outlook for the office market improved dramati-cally for Class A office with almost 80% of respondents believing that occupancy will increase. This pushed the outlook for investment higher and cap rates lower this quarter. The Class B office outlook remained positive and stable this quarter. Continued improvement in office employment is driving higher expectations.

RETAILThe outlook for retail properties continued to im-prove this quarter for all sectors except Large Centers. Growth in rents and occupancy are driving the opti-mism. However increasing interest rates and declining consumer incomes will have an impact on this seg-ment. The positive fundamentals continue to drive cap rates and yields lower across all but one segment of this sector. Respondents believe that cap rates should remain stable while yields increase over the coming quarters.

LAND INVESTMENTThe outlook for investment in land continues a steady upward trend across all property types this quarter. More respondents believe that now is a good time to buy land across all types. Improving fundamentals and limited supply are starting to drive development par-ticularly in the multi-family sector. Land with residen-tial entitlements reached another survey high.

CAPITAL AVAILABILITYRespondents continue to believe that capital avail-ability will increase in future quarters. An improving economy and increased lending activity by banks is driving respondents’ opinions. Additionally, private equity continues to pour into this asset class looking for higher yields.

UF COMMERCIAL REAL ESTATE SENTIMENT INDEXThe Sentiment index increased this quarter to its highest level since the 4th quarter of 2006. Surprising-ly, Developers now have the most optimistic outlook of their own businesses, reaching a new survey high. Brokers and owners are close behind in their optimism. Surprisingly, the steadiest group is the least optimistic with appraiser’s have the lowest outlook.

Section 1: Investment Outlook

The investment outlook for Florida improved to a near survey high this quarter, increasing from last quarter’s decline. Despite uncertainty in the national economic view, Florida’s economy continues to improve. In-creased employment, record tourism and international investment have proven a catalyst for the real estate markets. These factors are leading respondents to believe that fundamentals will continue improving in future quarters across all sectors. These improving

Section 2: Residential Development

EXPECTED ABSORPTION RATES The outlook for residential absorp-tion improved this quarter with respondents continuing to believe that absorption will increase. The improved Florida economy will help the housing market as we continue to see net population growth and job growth in the state. Additionally, a robust winter selling season boosted expectations and drove builders to expand lot inven-tories to drive growth. Banks are starting to lend more in this market which will help additional potential borrowers take advantage of the current interest rates before they go up again. However, there remains a credit crunch in the housing market that continues to hold down growth opportunities.

fundamentals along with a shortage of supply are increasing development activity and therefore the outlook for investment in land, which continues to improve the overall investment outlook.

Respondents remain concerned about the uncertainty in Washington D.C. and the effect on interest rates. Consen-sus among the respondents is that interest rates will increase but worry about the rate of increase and the timing. This investment index is weighted 40 percent on single family and residential condominium development, 40 percent on rental property of all types, and 20 percent on undeveloped land. Thus, it is at least fifty percent driven by the residential development outlook.

The condo market is primarily driven by South Florida. Foreign buyers and all cash transaction continue to dominate the marketplace.

EXPECTED PRICE CHANGES Expectations for price changes increased this quarter for both single family and condo developments after several quarters of decline. Continued improvement of Florida’s economy will continue to have a positive impact on pricing.

However, there are increasing headwinds as real employee wages are declining and expectations that in-terest rates will again start increasing. Continuation of these trends will have a significant impact on builders’ ability to increase pricing. In the meantime, builders are able to increase pricing to offset the increased cost of materials and labor.

INVESTMENT OUTLOOK The outlook for investment in residential development remained positive this quarter. An improved economy continues to drive additional investment in the resi-dential market. All-time highs in the stock market will drive additional investment in the second/vacation home market in Florida with the “season” starting in November. Additionally, continued job growth and population growth will drive the need for additional housing in key markets which will spur investment. In-vestors will continue to keep a close eye on the interest rates as they make investment decisions in this sector.

Section 3: Apartments

EXPECTED OCCUPANCY The outlook for occupancy in market rate apartments continued a steady decline over the past two years as new inventory is delivered to the market, affecting oc-cupancy projections. Respondents continue to believe that demographics are favorable for this sector in the near future, which will have a positive impact on ab-sorbing the additional supply. Also, increasing interest rates will prevent more buyers from purchasing and force them to remain renters.

If developers remain disciplined and don’t overbuild, the apartment sector will remain a good investment.

EXPECTED RENTAL RATES Expectations for rental rates improved slightly this quarter for market rent apartments as respondents continue to expect rental rates to increase with infla-tion. Demand continues to outweigh supply which has driven both occupancy and rents higher. This trend will continue as demographic preferences lean to-ward rental living in urban areas. However as the large number of new units under construction are delivered to the market there will be increased pressure on rents to maintain occupancy at older well located properties. This should continue over the near future.

INVESTMENT OUTLOOK With strong occupancy and rent expectations, the investment outlook remains positive for apartments. Despite rising interest rates that may impact cap rates, investors still like this market. In part, they are buff-ered from rising cap rates because occupancy and rent has grown faster than inflation over the past couple years.

This sector continues to benefit from a tremendous amount of capital availability, however, rising interest rates will make core deals harder to underwrite. An-other potential risk, although more long term, is the ul-timate resolution of Fannie Mae and Freddie Mac. The GSAs provide a lot of the liquidity in the apartment market and winding them down will have a negative impact on the market.

CAP RATES Cap rates remained stable at 6.3% this quarter for market rent apartments. Despite the outlook for higher interest rates, rental growth continues at rates above inflation. This, along with the large amount of capital chasing multi-family investments, keep cap rates stable for core deals. However, respondents believe that increasing interest rates and the additional supply coming to the market will work together to slightly increase caps rates over the next year.

YIELDS Required yields increased dramatically this quarter, reflecting respondents’ view that interest rate increases and a lack of quality assets are driving up return requirements. Investors are shifting to secondary and in some cases, tertiary markets which drives up yield

expectations. Demographics, population growth and preferences will continue to drive investment in this sector and that competition for deals should insure that yields remain low in the coming quarters.

Section 4: Industrial

EXPECTED OCCUPANCY The outlook for occupancy in the industrial sector improved this quarter across both sectors, with the Warehouse sector reaching new survey highs. Continued improvement in the economy is generating more construction employment and small business starts which traditionally use flex space. Additionally, the continued strong trade with Latin America is having a positive impact on warehouse space.

Retailers continue reinvent their business models in a race to provide next day or same day delivery. This is changing the face of industrial real estate as warehouse space is becoming a necessity to get closer to the end consumer. Amazon’s two distribution facilities in the Tampa/Lakeland markets are just the start of what will be a continuous expansion of warehouse space.

EXPECTED RENTAL RATES Industrial rent expectations have steadily improved since the bottom in the second quarter of 2009. Improving demand for space and limited new development is driving expectations for rental rates higher over the next year.

Availability of land for industrial development will be a big factor in which communities will benefit the most from the industrial expansion needs. Locations with multimodal connections will continue to command the highest rents and rent growth along with technology parks.

INVESTMENT OUTLOOK The outlook for investment in industrial real estate remains positive, but declined slightly this quarter. Improving fundamentals continue to influence respon-dents’ view of investment in this sector. Continued positive trade with South America and the expected positive impact of the Panama Canal expansion along with a limited amount of new supply coming to market will have positive effects on this sector.However, rising interest rates pose a threat to those

fundamentals and investors will maintain a close watch. Additionally, technology, particularly the rise of the 3-D printer may have a negative impact on this sector.

CAP RATES Cap rates for flex space increased this quarter to 8.7%, while cap rates for warehouse space decreased slightly to 7.2%. This sector continues to benefit from improving fundamentals and an inflow of capital looking for higher yields. Additionally, debt financing is starting to open up in this sector which is making investment more attractive. However, rising interest rates may influence the positive fundamentals and financing options for investors.

YIELDS Required yields for warehouse space decreased to 8.9% while yields for flex space increased to 11.5%. Improving fundaments and demand are positively affecting warehouse yields. Despite positive growth in construction, investors remain cautious in the flex space sector. Rising interest rates may threaten the fundamentals and impact the required yields in this sector; however, respondents currently believe that yields will remain steady over the next 12 months.

Section 5: Office

EXPECTED OCCUPANCY The outlook for occupancy in Class A office continued to improve dramatically with almost all respondents believing that occupancy will increase over the coming year. The outlook for Class B declined slightly but remained positive with almost 60% of respondents believing occupancy will grow. The continued recovery of jobs in Florida, particularly office space jobs is influencing respondents’ outlook. This segment is also benefitting from little new development which is allowing current buildings time to improve occupancies with a slowly improving economy.

Despite the improvement in office jobs, companies continue to be very cautious about the amount of space they need per worker. As these companies bring in new staff, they do so in existing office space. This trend will continue to regulate new development and continue to have a positive impact on occupancy. However, the continued reduction in office space per worker puts tremendous demands on current space that was not designed for the number of people using the space. Demands on plumbing, heating and air systems and parking will provide challenges to landlords and may drive new development that can plan for these trends. Given these competing trends, we should expect that occupancy will continue to improve in the short term but level off as development starts.

EXPECTED RENTAL RATES Occupancy levels are finally starting to increase in the office sector which has allowed landlords to reduce concessions and increase rent. However, even with increasing job growth, companies continue to add workers in existing space. Given that, respondents believe that rents will only grow with inflation in the coming year.

In the face of increasing demand from job growth and more companies moving to Florida, development of new office space should be needed over the next year. However current rents in most markets don’t justify the new development. In the short term this will positively impact existing buildings with better rental rates.

INVESTMENT OUTLOOK

The outlook for investment continued to improve this quarter in both office sectors. Improving occupancy and growing rents favor new investment. Buildings that are designed to reduce operational costs will continue to be in favor with investors to ensure a good

yield. Additionally, growing demand from job growth and limited new supply will also benefit investors in this sector.

CAP RATES With an improving investment outlook and fundamentals, Cap rates declined this quarter in both subsectors with Class A cap rates at 7.2% and Class B rates at 8.4%. Limited development in this sector will keep fundamentals improving for the next several quarters to the benefit of current investors. These factors are reducing risk in this sector. Despite an outlook of increasing interest rates, continued improvement in the Florida economy and job growth, along with stronger fundamentals, lead respondent’ to believe that cap rates will be stable in future quarters.

Section 6: Retail

EXPECTED OCCUPANCY The outlook for occupancy remains strong for retail occupancy across all sectors this quarter. This optimism is being driven by the improving economy, consumer confidence, and growth within Florida. Retailers continue to look for quality locations throughout Florida and have increased their store openings for the coming year. The University of Florida Bureau of Business and Economic Research’s consumer sentiment index was 82 in June, the highest level since 2007. Additionally, the state continues to set records with the number of visitors coming to Florida which is also helping to boost retail sales. These factors should continue to drive occupancy in retail going forward.

YIELDS Required yields were mixed this quarter with Class A yields declining to 9% while Class B yields increased to 11.2%. The Class A yield reached a survey low which reflects investors continued preference for high quality class A assets in core locations. With interest rates projected to rise we would expect required yields

will certainly increase. However, several factors are working to counteract any future rise in interest rates, including continued growth in Florida office jobs and limited new supply in office space. These factors are influencing respondents to project not change in yields over the next year for either sector.

EXPECTED RENTAL RATES The outlook for rental rates remained positive this quarter with most respondents believing that rental rates will rise with inflation. Given the strong outlook for occupancy, we would expect that rental rates will grow in the absence of new supply and reduction in available space. Continued growth in job production and an improving economy should maintain consumers’ confidence which will encourage continued spending. Retailer expansion and competition for the best locations will continue to have a positive effect on rental rates.

INVESTMENT OUTLOOK The outlook for investment in retail remains positive across all subsectors with the exception of Large Retail. Improving fundamentals continue to drive investment outlook. Florida’s economy and job growth are having a positive impact on consumers which will benefit retailers. As long as Washington does nothing to negatively impact consumers, this trend will continue. Retailers are continuing to look for ways to increase efficiency while decreasing store size, which explains

the decline in outlook for Large Retail. Additionally, online retailing continues to exert pressure on retailers particularly in the electronics and book sectors. Grocery anchored centers continue to be the favored investment option for investors, who prefer best in class grocers in primary locations. Interest rates will also factor into the outlook as higher rates will drive higher cap rates and yields.t

CAP RATES Cap rates continue to decline in the retail sector with rates for large centers, neighborhood centers, strip centers and free standing retail at 6.4%, 6.7%, 8.4% and 6.9% respectively. However, the rising interest rates and the expectation that they will continue to increase

impacted respondents’ view on the future direction of cap rates. Respondents believe that rates will either remain stable or increase in coming quarters.

YIELDSYields were mixed this quarter with Neighborhood Centers and Free Standing retail increasing and the other two sectors decreasing. Yields for Large Centers, Neighborhood Centers and Free Standing retail reached 8.5%, 10%, and 8.9% respectively.

While Strip Center yields increased to 10.9%. Yields reflected improved fundamentals this quarter along with increased competition for investment capital. Increasing interest rates will impact this sector and influenced respondents’ views. They believe that yields will increase in coming quarters.

Section 7: Outlook for Investment in Undeveloped Land

LAND WITHOUT ENTITLEMENTS OR WITH RESIDENTIAL ENTITLEMENTS The outlook for investment in land continues to be positive in both sectors with both reaching survey highs. The improving housing sector is driving land pricing higher as they continue to buy entitled prop-erty to help maintain the current growth levels. This is in turn driving investment in non-entitled land as investors look to entitle the land and capture the home builders’ attention. Additionally, land for apartment investment is in high demand and driving pricing sig-nificantly higher. Investors will continue to keep an eye on interest rates as that could have a negative impact on the housing market.

LAND WITH OFFICE OR RETAIL ENTITLEMENTS The outlook for investment in land with office or retail entitlements increased this quarter reaching a new survey high. Respondents believe that office and retail fundamentals are improving to the point that new development is warranted. The retail sector is still the favored of the two sectors and new retail entitled land will be purchased for investment and development. However, with an improving office market and office job growth, investors will start buying land for future office development.

LAND WITH HOSPITALITY ENTITLEMENTS The investment outlook for land with hospitality entitlements improved again this quarter reaching a survey high. Tourism in Florida continues to set records through the second quarter and is driving resurgence in the hotel sector. This trend is having the most impact in Orlando and Miami which will see the bulk of the new hotel development. This trend should continue with a higher percentage of visitors from foreign markets.

LAND WITH ENTITLEMENTS FOR WAREHOUSE OR R&DThe investment outlook for land with warehouse or R&D entitlements improved this again this quarter. Investment in warehouse projects is picking up in port areas, particularly Miami, where exports to South America are up and require additional warehouse space. Ports throughout Florida continue to focus on expansion in preparation for the expansion of the Panama Canal. Retail companies continue to refine their business models to compete with online shopping which is driving additional demand for warehouse space closer to the end consumer. This trend will have a positive impact on areas connected with major roads and multi-modal sites.

LAND FOR URBAN RENEWALThe outlook for investment in urban renewal improved this quarter. As more people move toward urban areas investment in land for urban renewal will increase. We are starting to see more projects, particularly in Miami, but projects in small cities like Gainesville, with Inno-vation Square, are leading the state in urban renewal. This is a trend that will continue over the next several years.

Section 8: Business and Capital Availability Outlook

CAPITAL AVAILABILITYThe outlook for capital availability increased slightly this quarter for both acquisition and development cap-ital. Respondents continue to believe that capital will increase over the coming year. An increase in interest rates will not impact the capital flowing to real estate unless the risk adjusted returns decline in relation to other asset classes. Additionally, in an inflationary economy, more investors will look for hard assets to invest in, which will keep real estate in a favorable position.

Debt capital is continuing to increase for all asset class-es as more banks get back into the lending business. Improving asset prices are improving bank balance sheets and allowing them to loan more. This should continue, albeit with higher rates as interest rates con-tinue to rise.

UF COMMERCIAL REAL ESTATE SENTIMENT INDEX

The UF Commercial Real Estate Sentiment Index increased this quarter to its highest level since the 4th quarter of 2006. Florida’s improved economy along with improved job growth and record tourism are hav-ing a positive impact on our respondents’ outlook.The increase in the index was driven by growing optimism from developers, owners and brokers. Im-proved fundamentals are generating the need for new development across several sectors, which is boosting the outlook for developers and other service providers who generally focus on the development side of the business.

Surprisingly the least optimistic of the respondents are the appraisers, who continue to face tremendous pres-sure from the Dodd-Frank legislation which is pushing prices and quality lower. Our respondents believe there could be a growing crisis in the appraisal industry as the industry grows older with fewer young profession-als entering the business.

Section 9: Dominant InvestorsRespondents were asked to indicate which of five in-vestor groups they perceived to be the most active for each type of property they analyze. Not surprisingly, REITs and Institutions remain very active buyers, but

private investors are very active as fewer core proper-ties are available to purchase.

Section 10: Characteristics of Survey Respondents

PROFESSION OF RESPONDENTS Survey responses increased this quarter to 78 respon-dents. Approximately 64 percent of the respondents reported being an appraiser; 81% with designations

of MAI, SREA or SRPA. The next largest groups were other service providers and brokers.

MARKETS OF FAMILIARITYEach respondent was asked to select up to four regional markets with which they are familiar. In the latest survey, these choices accumulated to 107 observations. The highest number of responses was for

PROPERTY TYPES OF FAMILIARITYEach respondent was asked to select up to three property types with which they were familiar. Altogether, 152 selections were made in the latest survey round. Single family development was selected by 15 respondents while condominium development

the Tampa-St. Pete, which had 18 observations. The lowest respondent support came from the Gainesville with 2.

was selected by 8. The largest response for commercial property was in Strip Centers with 23 responses. The lowest response was for Condo Conversion with 0.

Section 11: Details of Cap Rates, Yields and Expected ChangesTable 1 summarizes estimates of cap rates and yields for twelve property types over the last four quarters of the survey. In addition, this table shows the distri-bution of expectations for changes in each reported cap rate and yield. In particular, the table reports the percent of respondents expecting each cap rate and yield to either rise or fall in the future. Excluded from this table is the percentage of respondents whom are

expecting no change. This third percentage can be computed as 100 less the two percentages reported. Since prior sections discuss the content of Table 1, further comment is not given here. The table is simply provided as a reference to facilitate application of the survey results.

Section 12: Local MarketsStarting with the 3rd quarter of 2011, we have changed the presentation of the local market data to a more graphical format. This makes it easier, at a glance, to get a sense of what is happening in each market. As part of the transition you will notice that each report is broken up into property types. Additionally, you will

see a table with indicating the direction of our respon-dents’ expectations for the various indicators. Please use the following legend to interpret the results.For future expectations you will see the following sym-bols. Please refer to their definition for interpretation:

An upward pointing arrow indicates an

increasing trend.

An upward but diagonal pointing arrow indicates a slightly positive or increasing trend.

A side pointing arrow indicates a neutral trend.

A downward but diagonal pointing arrow indicates a slightly negative or slightly declining trend.

A downward pointing arrow indicates a decreasing or negative trend.

Regional Market Report for Dade

MULTI-FAMILY PROPERTIESSurvey of Emerging Market Conditions February 2014

Future ExpectationsApartments Condo Conversion

Cap RatesYieldsInvestment OutlookOccupancyRents


Mul

ti-F

amily

Pro

pert

ies

5.585.95 5.72

4.78

6.02

0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend

Apartments ‐Market Condo Conversions

7.57

6.58

9.438.72

6.09

0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

8.00

9.00

10.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend


Investor Profile ‐ Condo Conversion

R.E. Companies

25%

REITs50%

Foreign Buyers25%

Investor Profile ‐Apartments

© 2014 University of Florida Bergstrom Center for Real Estate Studies

INDUSTRIAL PROPERTIES

Survey of Emerging Market Conditions February 2014


Future ExpectationsWarehouse Flex Space


Indu

stria

l Prope

rties

6.97

7.15

6.58

7.02

7.11

6.20

6.30

6.40

6.50

6.60

6.70

6.80

6.90

7.00

7.10

7.20

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend

Warehouse Flex Space

8.94

10.14

8.12

10.76

8.28

0.00

2.00

4.00

6.00

8.00

10.00

12.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend


Investor Profile ‐ Flex Space

Institutions100%

Investor Profile ‐Warehouse


OFFICE PROPERTIES



Future ExpectationsOffice: Class A Office: Class B


Office Prop

ertie

s

6.80

7.46

6.53

7.608.14

0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

8.00

9.00

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend

Office:Class A Office:Class B

8.71

8.198.32

9.67

8.75

7.00

7.50

8.00

8.50

9.00

9.50

10.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend


Investor Profile ‐ Office: Class B

R.E. Companies100%

Investor Profile ‐ Office: Class A


RETAIL PROPERTIES



Future Expectations

Retail‐Large Neighborhood Centers Strip Centers Free StandingCap RatesYieldsInvestment OutlookOccupancyRents

Retail Prop

ertie

s

Q4‐13 Q1‐14 Q2‐14Retail‐Large 6.58 7.54 5.85Neighborhood Retail 6.44 7.10 5.87Strip Centers 8.10 7.54 7.60Free Standing 6.17 6.31 5.87

5.00

5.50

6.00

6.50

7.00

7.50

8.00

8.50

Cap Rate Trend


5.005.506.006.507.007.508.008.509.009.5010.00

Yield Trend

Foreign Buyers, 100%

Investor Profile ‐Neighborhood Center

REITs100%

Investor Profile ‐ Retail‐Large

Private Buyers100%

Investor Profile ‐Strip Centers

Private Buyers100%

Investor Profile ‐Free Standing


Regional Market Report for Broward





Mul

ti-F

amily

Pro

pert

ies

5.576.17

5.73

4.77

6.23

0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


7.30 7.39

9.118.45

6.89

0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

8.00

9.00

10.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend



R.E. Companies

50%Foreign Buyers50%








Indu

stria

l Prope

rties

6.95

7.37

6.59

7.00

7.32

6.00

6.20

6.40

6.60

6.80

7.00

7.20

7.40

7.60

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


8.68

10.95

7.80

10.49

9.09

0.00

2.00

4.00

6.00

8.00

10.00

12.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend



Institutions100%



OFFICE PROPERTIES





Office Prop

ertie

s

6.79

7.67

6.54

7.59

8.35

7.72

0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

8.00

9.00

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


8.45

8.99

8.00

9.419.56

9.13

7.00

7.50

8.00

8.50

9.00

9.50

10.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend


Private Buyers, 100%


R.E. Companies100%



RETAIL PROPERTIES



Future Expectations


Retail Prop

ertie

s


5.00

5.50

6.00

6.50

7.00

7.50

8.00

8.50

Cap Rate Trend


5.00

6.00

7.00

8.00

9.00

10.00

11.00

Yield Trend

R.E. Companies,

50%

Foreign Buyers, 50%


REITs100%


Private Buyers100%


Private Buyers100%



Regional Market Report for Palm Beach





Mul

ti-F

amily

Pro

pert

ies

5.786.17 6.08

4.98

6.23

0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


7.79 7.39

9.718.95

6.89

0.00

2.00

4.00

6.00

8.00

10.00

12.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend



R.E. Companies

100%








Indu

stria

l Prope

rties

7.17

7.37

6.94

7.227.32

8.29

6.00

6.50

7.00

7.50

8.00

8.50

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


9.17

10.95

8.40

10.98

9.09

9.99

0.00

2.00

4.00

6.00

8.00

10.00

12.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend




Private Buyers34%

REITs33%

Institutions33%



OFFICE PROPERTIES





Office Prop

ertie

s

7.00 6.89

7.808.35

8.08

0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

8.00

9.00

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


8.94

8.60

9.90

9.569.72

7.50

8.00

8.50

9.00

9.50

10.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend




R.E. Companies100%



RETAIL PROPERTIES



Future Expectations


Retail Prop

ertie

s

Q4‐13 Q1‐14 Q2‐14Retail‐Large 6.78 6.21Neighborhood Retail 6.64 7.31 6.23Strip Centers 8.30 7.76 7.96Free Standing 6.37 6.52 6.23

5.00

5.50

6.00

6.50

7.00

7.50

8.00

8.50

Cap Rate Trend

Q4‐13 Q1‐14 Q2‐14Retail‐Large 9.38 7.96Neighborhood Retail 8.79 9.55 9.26Strip Centers 9.73 9.28 9.95Free Standing 7.05 8.46 8.20

5.00

6.00

7.00

8.00

9.00

10.00

11.00

Yield Trend

R.E. Companies,

100%


REITs100%


Private Buyers100%


Private Buyers100%

R.E. Companies

33%



Regional Market Report for Treasure Coast

MULTI-FAMILY PROPERTIES





Mul

ti-F

amily

Pro

pert

ies

6.07

6.28

6.35

5.90

5.95

6.00

6.05

6.10

6.15

6.20

6.25

6.30

6.35

6.40

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


7.81

7.32

6.83

6.20

6.40

6.60

6.80

7.00

7.20

7.40

7.60

7.80

8.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend










Indu

stria

l Prope

rties

7.45 7.487.97

7.50 7.43

9.32

0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

8.00

9.00

10.00

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


9.18

10.88

8.08

11.00

9.029.67

0.00

2.00

4.00

6.00

8.00

10.00

12.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend




Private Buyers100%



OFFICE PROPERTIES





Office Prop

erties

8.09

9.11

7.40

7.60

7.80

8.00

8.20

8.40

8.60

8.80

9.00

9.20

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


9.91

9.40

9.10

9.20

9.30

9.40

9.50

9.60

9.70

9.80

9.90

10.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend


Investor Profile ‐ Office: Class BInvestor Profile ‐ Office: Class A


RETAIL PROPERTIES



Future Expectations


Retail Prop

ertie

s

Q4‐13 Q1‐14 Q2‐14Retail‐Large 7.06Neighborhood Retail 6.92 7.43Strip Centers 8.59 7.87Free Standing 6.65 6.63 7.26

5.00

5.50

6.00

6.50

7.00

7.50

8.00

8.50

9.00

Cap Rate Trend

Q4‐13 Q1‐14 Q2‐14Retail‐Large 9.39Neighborhood Retail 8.80 9.49Strip Centers 9.74 9.22Free Standing 7.06 8.40 7.88

5.005.506.006.507.007.508.008.509.009.5010.00

Yield Trend




Private Buyers100%

R.E. Companies

33%



Regional Market Report for Southwest Coast






Mul

ti-F

amily

Pro

pert

ies

6.06

5.26

4.80

5.00

5.20

5.40

5.60

5.80

6.00

6.20

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


8.75

9.90

8.00

8.20

8.40

8.60

8.80

9.00

9.20

9.40

9.60

9.80

10.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend










Indu

stria

l Prope

rties

7.44

7.04

7.49

8.39

6.00

6.50

7.00

7.50

8.00

8.50

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


10.12

8.26

11.94

9.85

0.00

2.00

4.00

6.00

8.00

10.00

12.00

14.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend




Institutions50%

Foreign Buyers50%



OFFICE PROPERTIES





Office Prop

ertie

s

7.27

8.45

6.99

8.08

9.13

0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

8.00

9.00

10.00

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


9.89 9.91

8.45

10.8510.48

0.00

2.00

4.00

6.00

8.00

10.00

12.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend



Private Buyers67%

R.E. Companies33%



RETAIL PROPERTIES



Future Expectations


Retail Prop

ertie

s

Q4‐13 Q1‐14 Q2‐14Retail‐Large 7.06 8.53 6.30Neighborhood Retail 6.92 6.33Strip Centers 8.58 8.54 8.06Free Standing 6.64 7.30

5.00

5.50

6.00

6.50

7.00

7.50

8.00

8.50

9.00

Cap Rate Trend

Q4‐13 Q1‐14 Q2‐14Retail‐Large 10.33 11.17 7.82Neighborhood Retail 9.74 9.12Strip Centers 10.68 10.21 9.81Free Standing 8.00 9.39

5.00

6.00

7.00

8.00

9.00

10.00

11.00

12.00

Yield Trend



REITs34%

Institutions33%

Foreign Buyers33%


Private Buyers100%




Regional Market Report for Daytona Beach






Mul

ti-F

amily

Pro

pert

ies

6.47

0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


13.79

0.00

2.00

4.00

6.00

8.00

10.00

12.00

14.00

16.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend



Private Buyers100%








Indu

stria

l Prope

rties

8.36

7.33

8.68

6.50

7.00

7.50

8.00

8.50

9.00

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


11.5812.48

14.08

0.00

2.00

4.00

6.00

8.00

10.00

12.00

14.00

16.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend




Private Buyers100%



OFFICE PROPERTIES





Office Prop

ertie

s

8.20

9.00

9.42

8.47

7.40

7.60

7.80

8.00

8.20

8.40

8.60

8.80

9.00

9.20

9.40

9.60

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


11.35

12.3111.39

13.81

0.00

2.00

4.00

6.00

8.00

10.00

12.00

14.00

16.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend





RETAIL PROPERTIES



Future Expectations


Retail Prop

ertie

s

Q4‐13 Q1‐14 Q2‐14Retail‐Large 7.98 6.60Neighborhood Retail 7.84 6.62Strip Centers 9.50 8.83 8.35Free Standing 7.56 6.62

5.005.506.006.507.007.508.008.509.009.5010.00

Cap Rate Trend

Q4‐13 Q1‐14 Q2‐14Retail‐Large 11.79 12.04Neighborhood Retail 11.20 13.34Strip Centers 12.14 11.11 14.03Free Standing 9.46 12.29

5.006.007.008.009.0010.0011.0012.0013.0014.0015.00

Yield Trend


REITs, 33%


REITs50%

Foreign Buyers50%


Private Buyers100%


Private Buyers100%



Regional Market Report for Orlando






Mul

ti-F

amily

Pro

pert

ies

6.27

6.066.18

5.47

5.00

5.20

5.40

5.60

5.80

6.00

6.20

6.40

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


8.70 8.98

11.18

9.86

0.00

2.00

4.00

6.00

8.00

10.00

12.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend



Private Buyers25%

R.E. Companies

25%

REITs50%








Indu

stria

l Prope

rties

7.65

7.04

7.70

7.21

8.39

6.00

6.50

7.00

7.50

8.00

8.50

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


10.08 9.87

11.89

10.6811.46

0.00

2.00

4.00

6.00

8.00

10.00

12.00

14.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend




REITs100%



OFFICE PROPERTIES





Office Prop

ertie

s

7.497.56

6.99

8.29 8.25 8.18

6.00

6.50

7.00

7.50

8.00

8.50

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


9.85

10.58

10.07

10.81

11.15 11.19

9.00

9.50

10.00

10.50

11.00

11.50

Q4‐13 Q1‐14 Q2‐14

Yield Trend




R.E. Companies100%



RETAIL PROPERTIES



Future Expectations


Retail Prop

ertie

s

Q4‐13 Q1‐14 Q2‐14Retail‐Large 7.27 7.65 6.31Neighborhood Retail 7.13 7.21 6.33Strip Centers 8.79 7.65 8.06Free Standing 6.85 6.41

5.00

5.50

6.00

6.50

7.00

7.50

8.00

8.50

9.00

Cap Rate Trend


5.00

6.00

7.00

8.00

9.00

10.00

11.00

12.00

13.00

Yield Trend


REITs, 67%


REITs100%


Private Buyers100%




Regional Market Report for Lakeland






Mul

ti-F

amily

Pro

pert

ies

6.80

6.37

6.10

6.20

6.30

6.40

6.50

6.60

6.70

6.80

6.90

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


9.68

9.84

9.60

9.65

9.70

9.75

9.80

9.85

9.90

Q4‐13 Q1‐14 Q2‐14

Yield Trend



REITs100%








Indu

stria

l Prope

rties

8.19

7.23

8.58

6.50

7.00

7.50

8.00

8.50

9.00

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


11.05

8.53

10.13

0.00

2.00

4.00

6.00

8.00

10.00

12.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend




Private Buyers100%



OFFICE PROPERTIES





Office Prop

ertie

s

8.82

8.37

8.10

8.20

8.30

8.40

8.50

8.60

8.70

8.80

8.90

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


11.78

9.86

8.50

9.00

9.50

10.00

10.50

11.00

11.50

12.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend




RETAIL PROPERTIES



Future Expectations


Retail Prop

ertie

s

Q4‐13 Q1‐14 Q2‐14Retail‐Large 6.50Neighborhood Retail 6.52Strip Centers 9.32 8.50 8.26Free Standing 7.38 7.26 6.53

5.005.506.006.507.007.508.008.509.009.5010.00

Cap Rate Trend

Q4‐13 Q1‐14 Q2‐14Retail‐Large 8.09Neighborhood Retail 9.39Strip Centers 11.61 15.00 10.08Free Standing 8.93 14.18 8.34

5.00

7.00

9.00

11.00

13.00

15.00

17.00

Yield Trend



Foreign Buyers100%


Private Buyers100%


Private Buyers100%



Regional Market Report for Tampa






Mul

ti-F

amily

Pro

pert

ies

6.65

5.92

6.34

5.40

5.60

5.80

6.00

6.20

6.40

6.60

6.80

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


9.39

6.55

10.43

0.00

2.00

4.00

6.00

8.00

10.00

12.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend



Private Buyers40%

REITs40%

Institutions20%








Indu

stria

l Prope

rties

8.04

7.127.20

8.09

7.08

6.40

6.60

6.80

7.00

7.20

7.40

7.60

7.80

8.00

8.20

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


10.7610.11

9.13

12.58

8.25

0.00

2.00

4.00

6.00

8.00

10.00

12.00

14.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend



R.E. Companies34%

REITs33%

Foreign Buyers33%



OFFICE PROPERTIES





Office Prop

ertie

s

7.877.43

7.15

8.678.11 8.34

0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

8.00

9.00

10.00

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


10.53

8.16

9.32

11.49

8.72

10.45

0.00

2.00

4.00

6.00

8.00

10.00

12.00

14.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend


Private Buyers, 75%

R.E. Companies, 25%


R.E. Companies34%

REITs33%

Institutions33%



RETAIL PROPERTIES



Future Expectations


Retail Prop

ertie

s


5.00

5.50

6.00

6.50

7.00

7.50

8.00

8.50

9.00

9.50

Cap Rate Trend


5.00

6.00

7.00

8.00

9.00

10.00

11.00

12.00

Yield Trend



REITs67%

Foreign Buyers33%


Private Buyers86%

R.E. Companies

14%


Private Buyers100%



Regional Market Report for Sarasota





Mul

ti-F

amily

Pro

pert

ies

6.37

6.56

6.69

6.20

6.30

6.40

6.50

6.60

6.70

6.80

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


8.81

5.53

10.13

0.00

2.00

4.00

6.00

8.00

10.00

12.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend



Private Buyers100%








Indu

stria

l Prope

rties

7.75 7.76

7.55

7.71

8.90

6.50

7.00

7.50

8.00

8.50

9.00

9.50

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


10.18

9.09 8.837.23

10.42

0.00

2.00

4.00

6.00

8.00

10.00

12.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend


Institutions, 100%


Private Buyers50%

Foreign Buyers50%



OFFICE PROPERTIES





Office Prop

ertie

s

7.58

8.06

7.51

8.39

8.75 8.69

6.80

7.00

7.20

7.40

7.60

7.80

8.00

8.20

8.40

8.60

8.80

9.00

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


9.95

7.13

9.02

10.91

7.70

10.15

0.00

2.00

4.00

6.00

8.00

10.00

12.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend




R.E. Companies50%

REITs50%



RETAIL PROPERTIES



Future Expectations


Retail Prop

ertie

s

Q4‐13 Q1‐14 Q2‐14Retail‐Large 6.82Neighborhood Retail 7.23 6.84Strip Centers 8.89 8.15 8.57Free Standing 6.95

5.00

5.50

6.00

6.50

7.00

7.50

8.00

8.50

9.00

9.50

Cap Rate Trend

Q4‐13 Q1‐14 Q2‐14Retail‐Large 8.39Neighborhood Retail 9.80 9.69Strip Centers 10.74 7.42 10.38Free Standing 8.06

5.00

6.00

7.00

8.00

9.00

10.00

11.00

12.00

Yield Trend



REITs100%


Private Buyers67%

R.E. Companies

33%




Regional Market Report for Jacksonville





Mul

ti-F

amily

Pro

pert

ies

6.636.62

6.53

6.68

6.45

6.50

6.55

6.60

6.65

6.70

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


8.12

8.62

9.51

8.13

7.00

7.50

8.00

8.50

9.00

9.50

10.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend



Private Buyers100%








Indu

stria

l Prope

rties

8.02

7.81

7.39

7.77

8.74

6.50

7.00

7.50

8.00

8.50

9.00

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


9.49

12.18

8.20

10.329.80

0.00

2.00

4.00

6.00

8.00

10.00

12.00

14.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend




Institutions33%

Foreign Buyers67%



OFFICE PROPERTIES





Office Prop

ertie

s

7.85

8.12

7.34

8.658.80

8.52

6.50

7.00

7.50

8.00

8.50

9.00

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


9.26

10.23

8.40

10.2210.79

9.53

0.00

2.00

4.00

6.00

8.00

10.00

12.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend




Institutions100%



RETAIL PROPERTIES



Future Expectations


Retail Prop

ertie

s

Q4‐13 Q1‐14 Q2‐14Retail‐Large 7.63Neighborhood Retail 7.49 7.76 6.68Strip Centers 9.15 8.21 8.41Free Standing 7.22 6.97 6.68

5.00

5.50

6.00

6.50

7.00

7.50

8.00

8.50

9.00

9.50

Cap Rate Trend

Q4‐13 Q1‐14 Q2‐14Retail‐Large 9.70Neighborhood Retail 9.11 10.79 9.06Strip Centers 10.05 10.52 9.75Free Standing 7.37 9.70 8.01

5.00

6.00

7.00

8.00

9.00

10.00

11.00

12.00

Yield Trend

R.E. Companies,

100%



Private Buyers100%


R.E. Companies

100%



Regional Market Report for Gainesville/Ocala





Mul

ti-F

amily

Pro

pert

ies

6.56

6.59

6.54

6.55

6.55

6.56

6.56

6.57

6.57

6.58

6.58

6.59

6.59

6.60

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


8.48

8.23

8.10

8.15

8.20

8.25

8.30

8.35

8.40

8.45

8.50

Q4‐13 Q1‐14 Q2‐14

Yield Trend










Indu

stria

l Prope

rties

7.95

7.797.75

7.60

7.65

7.70

7.75

7.80

7.85

7.90

7.95

8.00

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


9.85

11.79

9.93

8.50

9.00

9.50

10.00

10.50

11.00

11.50

12.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend


Investor Profile ‐ Flex SpaceInvestor Profile ‐Warehouse


OFFICE PROPERTIES





Office Prop

ertie

s

7.78

8.10

7.92

8.58

8.78

9.10

7.00

7.50

8.00

8.50

9.00

9.50

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


9.63 9.84

8.32

10.58 10.40

9.44

0.00

2.00

4.00

6.00

8.00

10.00

12.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend




R.E. Companies100%



RETAIL PROPERTIES



Future Expectations


Retail Prop

ertie

s

Q4‐13 Q1‐14 Q2‐14Retail‐Large 7.56 8.18Neighborhood Retail 7.74Strip Centers 9.08 8.18 8.98Free Standing

5.00

5.50

6.00

6.50

7.00

7.50

8.00

8.50

9.00

9.50

Cap Rate Trend

Q4‐13 Q1‐14 Q2‐14Retail‐Large 10.06 11.10Neighborhood Retail 10.40Strip Centers 10.41 10.13 9.67Free Standing

5.00

6.00

7.00

8.00

9.00

10.00

11.00

12.00

Yield Trend



Private Buyers100%




Regional Market Report for Tallahassee/Panhandle





Mul

ti-F

amily

Pro

pert

ies

6.93

6.69

6.55

6.60

6.65

6.70

6.75

6.80

6.85

6.90

6.95

7.00

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


10.84

12.59

9.50

10.00

10.50

11.00

11.50

12.00

12.50

13.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend



REITs100%








Indu

stria

l Prope

rties

7.54

8.37

7.49

7.00

7.20

7.40

7.60

7.80

8.00

8.20

8.40

8.60

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


17.1614.03

15.30

0.00

2.00

4.00

6.00

8.00

10.00

12.00

14.00

16.00

18.00

20.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend


Investor Profile ‐ Flex SpaceInvestor Profile ‐Warehouse


OFFICE PROPERTIES





Office Prop

ertie

s

8.15

7.84

8.95

8.53

8.68

7.20

7.40

7.60

7.80

8.00

8.20

8.40

8.60

8.80

9.00

9.20

Q4‐13 Q1‐14 Q2‐14

Cap Rate Trend


11.99

15.2012.94

15.77

12.61

0.00

2.00

4.00

6.00

8.00

10.00

12.00

14.00

16.00

18.00

Q4‐13 Q1‐14 Q2‐14

Yield Trend





RETAIL PROPERTIES



Future Expectations


Retail Prop

ertie

s

Q4‐13 Q1‐14 Q2‐14Retail‐LargeNeighborhood Retail 7.79 7.49 6.83Strip Centers 9.45 7.93 8.57Free Standing 7.52 6.84

5.005.506.006.507.007.508.008.509.009.5010.00

Cap Rate Trend

Q4‐13 Q1‐14 Q2‐14Retail‐LargeNeighborhood Retail 11.84 15.76 12.15Strip Centers 12.77 15.49 12.84Free Standing 10.09 11.09

5.00

7.00

9.00

11.00

13.00

15.00

17.00

Yield Trend




Private Buyers100%


Private Buyers100%

REITs50%



survey of emerging market conditions · 2018. 5. 3. · regional market report for sarasota... 63...

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