CRE in Florida Gets Foreign Investor Push

A new article from the National Real Estate Investor titled Lenders are Helping Foreign Investors Push Florida’s Real Estate Market to a New Peak examines the current international influx and impact bringing the market to a crest. An excerpt follows:

The established model is to pay all cash for the first property and leverage the income gained for the second deal. Now, they are joining with others to buy an apartment building, convert it to a condominium, and sell the units to individuals in foreign countries who agree to leave them in the rental pool run by the management company. Why? Foreign investors are more comfortable owning units than shares in an LLC. These transactions are all cash transactions from the seller’s standpoint.

Foreigners are also making regular use of syndicators who scout properties, which are often in the Miami area. Syndicators provide a second benefit of using their track records to help obtain financing. Due to the fact that these syndicators have or do own property in the country already, and have an operation, bank accounts, etc., a lender is able to qualify them in a traditional way. If a borrower approaches a bank and doesn’t have any assets in the states already, they know they will not be able to go outside the country to collect on any deficiency in case of a default. On top of that, they can’t know if the buyer or entity is getting their funds from drugs or other illegal affairs.

Lenders are also becoming much more accommodating than in recent years. The Florida banks that survived the Great Recession are returning the market. Their loan criteria put greater weight on the sponsor’s track record than the property as they seek to minimize risk and regulatory scrutiny.

To read the full report, click here. For more news and information visit Blumberg Capital Partners.

South Florida Medical Office Buildings Bought for $47.1M

Tenet Healthcare Corporation, a health care services company, has sold nine of their South Florida medical office buildings to AW Property Company in a $47.1 million cash deal according to The Palm Beach Post. AW Property completed the deal through its joint venture with Behringer Harvard, a purchase that totaled 630,000 square feet. “This medical office portfolio provides an attractive value-added investment opportunity,” AW Property Managing Director Brian Waxman said in a news release.

The buildings sold in the portfolio include:

The Victor Farris Building, at 1411 N. Flagler Drive in West Palm Beach. The 148,000-square-foot medical office, next to Good Samaritan Medical Center, will get extensive upgrades.

The eight-story Palmetto Medical Plaza, a 130,000-square-foot building at 7100 W. 20th Ave., in Hialeah near Palmetto General Hospital.

Hialeah Medical Plaza, a 72,000-square-foot office building at 777 E. 25th St., near Hialeah Hospital.

The 56,000-square-foot North Shore Medical Arts building, at 1190 N.W. 95th St. in Miami, near North Shore Medical Center.

Four medical office buildings for a combined 207,000 square feet near Florida Medical Center in Fort Lauderdale.

The 20,000-square-foot St. Mary’s Professional Center, at 5035 Greenwood Ave. in West Palm Beach, near St. Mary’s Medical Center.

For more news and information visit Blumberg Capital Partners.

Florida Proposal To Allow Votes on Land Use

A new article from the Wall Street Journal titled "Florida Proposal Ruffles Builders" takes a closer look a new proposed legislation that would include voters in the decisions for land use, and the real estate community's reaction. Amendment 4, called "Hometown Democracy" by its supporters, would let the voters have a say on approving changes to a city's or county's comprehensive land use plan. Opponents say this would lead to gridlock at the polls and put a damper on plans by businesses to expand or relocate to Florida.

"Basically, the builders, together with the local commissions here, drove Florida over the cliff with reckless speculation," said Lesley Blackner, a Palm Beach-based environmental lawyer leading the drive. "What Amendment 4 does is give voters the check and balance" instead of "politicians who want to rubber stamp every development that comes their way."

"Even democrats are staying a fair distance away from it. It's gotten too much of an anti-business, anti-growth aspect to it,"said Florida pollster Tom Eldon. "It was a great idea when the economy was booming, but now that the economy is bad it's not safe ground."

"When you're no longer attracting business, the tax burden falls onto residents at a much higher rate," said Ryan Houck, who leads Citizens for Lower Taxes and a Stronger Economy, a political-action committee opposing the measure. "Businesses that might seek to come to Florida would find it incredibly difficult, costly, and uncertain. It would chase away business at a time when the state is hurting for tax revenue."

For more news and information visit Blumberg Capital Partners.