ECONOMY OVERVIEW
Greater Fort Lauderdale 2019 An in-depth review of the key issues facing Broward’s economy featuring the exclusive insights of prominent industry leaders
$159.00 ISBN 978-0-9988966-1-8
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ECONOMY OVERVIEW
2 | Invest: Greater Fort Lauderdale 2019 | ECONOMY
ECONOMY OVERVIEW
4 | Invest: Greater Fort Lauderdale 2019 | ECONOMY
Contents:
9 Economy:
26 Interview: Andrew Taubman, Principal, Kaufman Rossin
10 Economy in numbers
12 Relaxed and refined: With a robust economy bolstered by Florida’s largest recreational marine industry, Broward County continues to enjoy steady growth
44 Interview: Beverly Raphael, President & CEO, RCC Associates
45 Viewpoint: Scott Skidelsky, Florida President, Balfour Beatty U.S.
46 Market voices: Rising Costs
48 Interview: Charles Reid, CEO, Current Builders
13 Interview: Beam Furr, Outgoing Mayor, Broward County
28 High demand: With a growing population and steadily increasing investor interest, Broward’s real estate market is hot going into 2019
14 Interview: Monica Cepero, Deputy County Administrator, Broward County
30 Interview: Barry Somerstein, Partner, Greenspoon Marder
49 Marine & Logistics:
32 Interview: Michael Weymouth, President, The Las Olas Company
50 Marine & logistics in numbers
33 Interview: Arden Karson, South Florida Director, CBRE
36 Market voices: Senior Housing
38 Interview: Gregory West, CEO, ZOM Holding Inc.
51 Global gateway: Broward’s marine, trade and logistics industries continue to grow, supporting the needs of the U.S. and its foreign trade partners
39 Market voices: Experiential Retail
52 Interview: Steve Cernak, Chief Executive & Port Director, Port Everglades
53 Interview: Phil Purcell, President & CEO, Marine Industries Association of South Florida
55 Viewpoint: Eric Fabrikant, COO, SEACOR Holdings Inc.
58 Roudtable: Marine Challenges
15 Interview: Bob Swindell, President & CEO, Greater Fort Lauderdale Alliance 18 Interview: Keith Koenig, President, City Furniture & Chairman, Broward Workshop
20 Interview: Mike Jackson, CEO, AutoNation
23 Bread and butter: Small businesses are the backbone of Broward’s economy
27 Real Estate:
25 Interview: Sandy-Michael McDonald, Director, The Broward County Office of Economic and Small Business Development
41 Construction:
42 Meeting demand: Even with material costs on the rise and continued labor and land shortages, Broward County remains hungry for development 43 Interview: Robert Breslau, Chief Development Officer, Stiles Corporation
James Brewer, Director of Business Development, Derecktor Shipyards www.capitalanalyticsassociates.com
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ECONOMY OVERVIEW
Contents: Walter Duke, President, Walter Duke + Partners
85 Infrastructure, Utilities &
Joseph Farrell, Jr., President & CEO, Resolve Marine Group
86 Powering lives: While aging infrastructure remains a challenge in Broward, its cities are working hard to support highquality living into the future
87 Interview: Lawrence DeRose, Senior Vice President, Louis Berger
88 Viewpoint: Jennifer Jurado, Chief Resiliency Officer, Broward County
89 Viewpoint: Kristin Johnson Karp, President & CEO, Hotwire Communications
60 Interview: Paul Flannery, Executive Director, International Yacht Brokers Association
61 Market voices: Yachting
63 City of Pompano Beach:
64 City to watch: The City of Pompano Beach is quickly emerging as an up-and-coming hotspot for trendy startups and smart development
65 Interview: Lamar Fisher, Outgoing Mayor, City of Pompano Beach
66 Viewpoint: Greg Harrison, City Manager, City of Pompano Beach
71 Viewpoint: Tim Hernandez, Principal, New Urban Communities & Principal, Pompano Pier Associates
Environment:
93 Healthcare:
94 Wellness matters: Despite uncertainty over the future of federal healthcare, Broward’s healthcare facilities continue to innovate and grow
95 Interview: Caitlin Stella, CEO, Joe DiMaggio Children’s Hospital
96 Interview: Dr. Hugo Fernandez, Chair, Department of Malignant Hematology & Cellular Therapy at Memorial Healthcare System, Moffitt Cancer Center
73 Aviation & Transportation:
74 Aviation & transportation in numbers
75 Building connectivity: With a growing population and booming development, improving transportation infrastructure is a hot topic in Broward County
76 Interview: Mark Gale, CEO/ Director of Aviation, Fort Lauderdale-Hollywood International Airport 79 Viewpoint: Gregory Stuart, Executive Director, Broward Metropolitan Planning Organization
99 Viewpoint: Jonathan Watkins, CEO, Broward Health Imperial Point
100 Interview: Jeffrey Welch, CEO, Florida Medical Center 101 Interview: Jeffrey Freimark, President & CEO, Miami Jewish Health Systems
105 City of Lauderhill: 106 Vibrant city: The City of Lauderhill has evolved from humble beginnings into a thriving and diverse hotspot for the live-workplay lifestyle
81 Interview: Patrick Goddard, President & COO, Brightline
107 Interview: Kenneth Raymond Thurston, Mayor Elect, City of Lauderhill
82 Interview: Tim Fish, South Florida Managing Principal, HDR
109 Interview: Charles Faranda, City Manager, City of Lauderhill
83 Interview: Kasra Moshkani, General Manager, Uber
112 Interview: Craig Gundry, General Manager, Fassmer Technical Projects
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115
Banking & Finance:
116 Banking & finance in numbers 117 Favorable conditions: Despite global tensions and trade wars, tax reform, deregulation and rising interest rates are fueling a strong financial sector 119 Interview: Hector Ponte, Southeast Florida Region Bank President, Wells Fargo 121 Interview: Jorge Gonzalez, CEO, City National Bank 122 Market voices: Small Business 124 Roudtable: Tax Reform David Appel, Managing Partner, Cherry Bekaert LLP, South Florida Teri Kaye, Partner-in-Charge, Sunrise Office, Daszkal Bolton LLP Adam Spiegel, Managing Principal, MBAF James Sanderson, Tax Principal, KPMG 126 Interview: D. Nicholas Miceli, Regional President, Florida Metro, TD Bank 128 Market voices: Security
135 Viewpoint: Dan Lindblade, President & CEO, Greater Fort Lauderdale Chamber of Commerce 136 Interview: Jonathan Hage, President & CEO, Charter Schools USA
139 Tourism, Culture & Sports:
140 Unique experiences: Broward County’s tourism industry continues to pack a huge economic punch, offering sun, fun and culture all in equal measure 141 Interview: Stacy Ritter, President, Greater Fort Lauderdale Convention & Visitors Bureau 142 Interview: Joe Cox, President & CEO, Museum of Discovery and Science 146 Roudtable: Arts and Culture Doug McCraw, Founder & Owner, FATVillage
129 Education:
Elaina Norlin, Library Regional Manager, African American Research Library and Cultural Center
130 Solid foundation: Broward County’s educational institutions are adapting to a growing population and remain focused on preparing the future workforce
Bonnie Clearwater, Director & Chief Curator, NSU Art Museum Fort Lauderdale, Nova Southeastern University
131 Interview: Robert Runcie, Superintendent of Schools, Broward County Public Schools 133 Interview: George Hanbury II, President & CEO, Nova Southeastern University 134 Interview: Gregory Adam Haile, President, Broward College
ISBN 978-0-9988966-1-8 President: Abby Melone Chief Financial Officer: Albert E. Lindenberg Managing Editor: Jaime Muehl Executive Director: Erica Knowles Project Coordinator: Yuliia Yurevich-Paranchuk Contributing Designer: Md Shahidullah Contributing Writer: Sean O’Toole Interns: Megan Harmon James Woo Cover photo: Azeez Bakare Studios Invest: Greater Fort Lauderdale is published once a year by Capital Analytics Associates, LLC. For all editorial and advertising questions, please e-mail: contact@capitalaa.com To order a copy of Invest: Greater Fort Lauderdale 2019, please e-mail: contact@capitalaa.com All rights reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form by any means, without the express written consent of the publisher, Capital Analytics Associates, LLC. Whilst every effort has been made to ensure the accuracy of the information contained in this book, the authors and publisher accept no responsibility for any errors it may contain, or for any loss, financial or otherwise, sustained by any person using this publication. Capital Analytics Associates, LLC accepts no responsibility for the return of unsolicited manuscripts and/or photographs, and assumes no liability for products and services advertised herein. Capital Analytics Associates, LLC reserves the right to edit, rewrite, or refuse material.
Kelley Shanley, President & CEO, Broward Center for the Performing Arts 148 Interview: Arnold Donald, President & CEO, Carnival Cruise Corporation & PLC
Photo Credits: Contents: pg 5 – Jenni Morejon pg 6 – Museum of Science and Discovery Economy: pg 9 – Large: Las Olas Company Small: Paul Krashefski pg 12, 14, 16, 17, 20 – Paul Krashefski pg 23 – L as Olas Company pg 26 – BBX Capital Real Estate: pg 27 – L arge and small: Cushman & Wakefield pg 28– Cushman & Wakefield pg 32 – Las Olas Company pg 37 – Stiles Corporation
Construction: pg 41 – Large: RCC Associates Small: Emerald Construction pg 44 – RCC Associates pg 45 – Baker Concrete Marine & Logistics: pg 49 – Large: Port Everglades Small: Las Olas Company pg 51, 53 – Port Everglades pg 58 – Roscioli Donzi Yachts
pg 75– Broward County Aviation Department pg 82 – Broward Metropolitan Planning Organization
Small: Fassmer Technical Projects pg 106, 108, 111, 113– City of Lauderhill pg 114– Tate’s Comics
Infrastructure, Utilities & Environment: pg 85 – Large: Port Everglades Small: Florida Power & Light (FPL) pg 86, 88 – FPL
Banking & Finance: pg 115 – Large: Cushman & Wakefield
City of Pompano Beach: pg 63 – Large: City of Pompano Beach Small: John Knox Village pg 64, 68, 70 – City of Pompano Beach
Healthcare: pg 93 – Large and small: Miami Jewish Health pg 95 – Miami Jewish Health pg 99 – Jo DiMaggio Children’s Hospital pg 100 – Broward Health Imperial Point
Aviation & Transportation: pg 73 – Small: jetBlue
City of Lauderhill: pg 105 – Large: City of Lauderhill
Education: pg 129 – Large: Nova Southeastern University Small: Broward College pg 130 – Broward County Public Schools pg 133 – Nova Southeastern University Tourism, Culture & Sports: pg 140, 142 – Broward Center for the Performing Arts pg 149 – Costa Cruises pg 151 – The Restaurant People
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Economy: The economy continues its upward trend in Broward, Florida’s second most populous county, and employment continues to exceed prerecession highs. With over 20 miles of sunny beaches, a diversifying workforce, arts and cultural hubs and the largest recreational marine industry in the state, developers are increasingly targeting Fort Lauderdale as the site of their newest ventures. However, as the global landscape evolves, it remains essential for residents and leaders to stay focused on small businesses and expanding the middle class.
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Economy in numbers: 9.2
Broward County employment change by sector, May 2018 (year-on-year percent change): 9
0.4
1.8
0.5
0.7
1.3
3
2.4
2.8
6
Government
-0.7
Other services
Education & health services
Professional & business services
Financial activities
Information
Trade, transport & utilities
Manufacturing
Construction
Total non-farm
-3
Leisure & hospitality
-0.4
-0.5
0
Source: CareerSource Broward Region
Broward County employment by sector, May 2018:
106,200 Government
51,000
28,100
Construction
Manufacturing
39,500 Other services
188,200 95,100 Leisure & hospitality
Trade, transport & utilities
852,200 TOTAL
20,400 Information
110,800
59,600
Education & health services
Financial activities
153,200 Source: CareerSource Broward Region
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Professional & business services
BROWARD COUNTY POPULATION
AVERAGE ANNUAL WAGE
PERCENT CHANGE
1,909,632 2017
1,887,281
PERCENT CHANGE
$51,259 2017
1.2%
$49,550
2016
3.4%
2016
Source: CareerSource Broward Region
FOREIGN BORN PERSONS
PERSONS IN POVERTY
PERSONS WITHOUT HEALTH INSURANCE (UNDER 65)
HIGH SCHOOL GRADUATE OR HIGHER (AGE 25+)
BACHELOR DEGREE OR HIGHER (AGE 25+)
32.7%
13.5%
15.3%
88.3%
31.0%
Source: U.S. Census Bureau (2016 data)
Top 10 employers in Broward County, ranked by # of employees (2017): Company name
Municipality
Broward employees
Type of business
Nova Southeastern University
Davie
7,462
University - bachelor, master and doctoral degrees
AutoNation
Fort Lauderdale
4,000
Automotive retailer - corporate headquarters
American Express
Plantation
3,500
Commercial and consumer financial services; traveling consulting
Spirit Airlines
Miramar
1,800
Air carrier
Citrix
Fort Lauderdale
1,700
Leading software developer of interactive platforms
JM Family Enterprises, Inc.
Deerfield Beach
1,685
Diversified automotive provider
Kaplan
Fort Lauderdale
1,665
Online educational provider
Actavis
Davie
1,620
Developer, manufacturer and distributor of generic pharmaceutical
DHL Express
Plantation
1,400
Air courier services
Rick Case Automotive Group
Fort Lauderdale
1,379
Automotive sales and services
Source: Greater Fort Lauderdale Alliance
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Relaxed and refined: With a robust economy bolstered by Florida’s largest recreational marine industry, Broward County continues to enjoy steady growth Greater Fort Lauderdale has long been known as an international tourist destination, offering 23 miles of Blue Wave-certified beaches; 246 sunny days a year; creative culture, shopping and cuisine; and unparallelled accessibility thanks to its world-class airport and port. With a steady influx of new residents fueling a diverse workforce and a robust economy bolstered by Florida’s largest recreational marine industry, the region continues to enjoy solid economic growth as it looks ahead to 2019. Born to boom Broward County is located in the southeastern part of the state of Florida. According to a 2017 U.S. Census report, Broward has a population of 1,935,878, making it the second most populous county in Florida after Miami-Dade and the 17th most populous in the country. It has an average elevation of six feet above sea level and is bordered to the east by the Atlantic Ocean and to the west by the Everglades Wildlife Management Area. Of the county’s 471 square miles of developable land, the majority is already built. Broward comprises 31 incorporated cities, the largest of which is the City of Fort Lauderdale, along 12 | Invest: Greater Fort Lauderdale 2019 | ECONOMY
with many unincorporated areas. The county was founded on April 30, 1915, and named for Governor Napoleon Bonaparte Broward, who championed Everglades drainage during his term as governor and is widely remembered for his campaign to turn the Everglades into “useful land.” From its inception, the county was ripe for development, first as agricultural land and later as residential. It experienced several boom periods, with developers dredging wetlands to create island communities, before county leaders established a Land Use Plan in 1977 to help curb urban sprawl. Along with Miami-Dade and Palm Beach counties, Broward makes up the South Florida region, which is home to about 6 million residents, 53 percent of whom are bilingual. South Florida’s GDP is close to $325 billion, ranking it 38th in the world. With no individual state or local income taxes and a wide array of public and private universities, including four research institutions, the region is a hub for both national and international business. Served by three international airports and seaports and two major rail lines, South Florida is truly a global gateway.
CONSTRUCTION ECONOMY OVERVIEW
Trade hub Broward County — and the City of Fort Lauderdale in particular — has long been touted as a secondary market to Miami, but as prices continue to rise to the south, developers are increasingly looking north for affordable land. In PWC’s 2018 Emerging Trends in Real Estate Report, Fort Lauderdale ranked number six for most investable real estate market out of the 78 markets studied, moving up an astonishing 19 spots from its number 35 ranking in 2017 and edging out Miami, which ranked number 11. Greater Fort Lauderdale has shed its wild spring break image in favor of a more refined appearance that showcases a relaxed coastal environment, beautiful beaches and strong centers of commerce. An attractive home to multinational corporate and regional headquarters, Broward offers a strategic location for both U.S. and international companies to conduct business. A total of 1,200 multinational companies maintain operations in South Florida, generating more than $200 billion in revenue from the region each year. Greater Fort Lauderdale hosts many international and regional headquarters from countries in Europe, including the U.K., Spain, France, Germany and Italy. It is also home to a number of Canadian, Israeli and South American companies, as well as 200 headquarters for U.S. companies. With convenient air and sea transportation, cuttingedge connectivity and a well-educated multicultural workforce, Broward continues to rebrand itself as a modern international trade hub. It also boasts the fourth-largest foreign trade zone (FTZ) network in the U.S. and is currently seeking to ramp up its FTZ footprint as global trade wars heat up. The county has applied for Alternative Site Framework designation and at the time of print was awaiting federal approval, expected in late 2018, to create a countywide trade zone. Opened on an abandoned nine-hole golf course in 1929, today Fort Lauderdale-Hollywood International Airport (FLL) is recognized as one of the fastest-growing airports in the country. In 2016, FLL ranked number 21 in the U.S. for passenger traffic. Port Everglades, a man-made port originally dredged from a natural lake, is renowned for being one of the most diverse seaports in the country. Florida’s “powerhouse port” is one of the top three cruise ports in the world, one of the most active containerized cargo ports in the U.S. and the main seaport in South Florida for moving petroleum products like gasoline and jet fuel.
Beam Furr Outgoing Mayor Broward County
How is Broward working to be at the forefront of resiliency? The county needs to go from a gravity-fed drainage system to a pump-fed system because we only have so many inches of leeway. Right now, everything drains by gravity from the Everglades out to the ocean, but as sea level rises that cushion goes away. We have to do that within 20 years. It’s important that we show that we’re making some progress. The only way that we’re going to be able to keep our insurance rates and our cost of living down is to invest in sustainability. We’re going to find new technology, and we will also have to adapt. For example, building elevations are now based on future conditions. I think we’re the first county anywhere in the U.S. to do that. It means we’re looking forward in terms of development. We’re not putting our heads in the sand when it comes to sea-level rise. How are you working to increase collaboration in Broward County? We’ve been able to pull cities together to work on a number of issues, including a comprehensive waste system and a 30-year transportation plan. We’re realizing that makes sense for all of us to be working together. For the waste system, we will combine the cities and county into one district, which is to everybody’s benefit due to rising prices. Some things need to be in the public sector, and this is one of them. The number of cities in this county can create some difficulty, but we’re trying to eliminate some of that through things like universal permitting and online permitting, where you can do it through the county and it would be available everywhere. We’re recognizing some of those obstacles and listening to the business community’s needs. Moving forward, we will see businesses, municipalities and the county working together towards shared goals. www.capitalanalyticsassociates.com
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Monica Cepero Deputy County Adminstrator Broward County
What is your assessment of Broward’s economy? We continued to see strong job growth and business expansion in the first half of 2018. In June, our unemployment rate was 3.7 percent; that’s one of the lowest of any large urban county in the U.S. We’ve added over 14,000 jobs year-over-year, and I think we’re going to continue to see strong job growth thanks to the work of our private sector economic development partners, like the Greater Fort Lauderdale Alliance, focusing on targeted industries, including advanced manufacturing, aviation, aerospace, internal trade and logistics.
Broward’s robust economy is bolstered by Florida’s largest recreational marine industry.
Can you tell us about the penny tax that’s going on the ballot in November? The funding sources for public infrastructure in this county, let alone our country, have not been able to keep up with the growing demand for public transit. The recession created an even greater setback. Concurrently, there was pressure to get people to their jobs, which equaled more demand on public transit. That remains a specific challenge for us. Our commission is taking the lead in addressing these funding shortfalls, and that has led us to ask voters to support the penny tax for transportation. It’s going to help us have a sustainable, long-term, reliable resource and will also address the expansion work we need in the public transit arena. We’re hoping that some of this infrastructure investment results in reinvestment in the county, but the main focus is mobility for our residents.
Global landscape Nationally and globally, there are a number of trends that Broward County should be keeping an eye on as it continues to enjoy an era of economic prosperity. These include recent rollbacks to Dodd-Frank, welfare overhaul, immigration policy (particularly when it comes to the fate of DACA recipients, or Dreamers), burgeoning economic recovery in Latin America, an increasingly volatile global trade climate and the evolution of cyberspace.
What makes Broward a great place to do business? We have a very friendly business climate. There’s a lot of collegiality among the business community and a willingness to invest in the people and the future. We’re working collaboratively on our issues, trying to systematically address, for example, the homeless situation that exists. That’s a great example because it includes everything from nonprofit industries to business to government, all coming together on the same issue.
Roll on back For Broward’s robust banking industry, May 2018’s Economic Growth, Regulatory Relief and Consumer Protection Act, which loosened some of the tight regulations imposed by lawmakers after the last recession, offers some breathing room for smaller and mid-sized banks, for which regulatory compliance has been a costly challenge. The hope is that this will free them up to better serve both clients and shareholders.
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As a cultural crossroads, Broward is poised to continue its robust north-south trade with Latin America as it looks toward increasing east-west trade with growing partners like Kuwait, Russia and The Netherlands.
CONSTRUCTION ECONOMY OVERVIEW
Bob Swindell President & CEO Greater Fort Lauderdale Alliance
Faring not-so-well Still facing uncertainty in the later part of 2018 is the fate of the nation’s welfare system. In April, President Trump privately signed the Reducing Poverty in America by Promoting Opportunity and Economic Mobility executive order, which mandates that all secretaries government-wide review their welfare programs and propose new regulations and that all federal agencies enforce current work requirements, create new requirements and find ways to cut costs. In May, the House Ways and Means Committee approved the Jobs for Success Act, which proposes ambitious updates to the Temporary Assistance for Needy Families (TANF) program. The idea is to completely revamp both the way states are held accountable for putting recipients to work and the way the grants are managed while making no changes to the program’s overall funding. In 2017, 79,040 Florida adults and children statewide received welfare, and Broward County had a 14.4 percent poverty rate (up from 13.5 percent in 2016). In February 2018, state lawmakers were considering imposing a work requirement for those enrolled in Florida’s Medicaid program. While the House passed a bill to this effect, it didn’t move beyond a Senate committee before the legislative session ended.
What is your reaction to Broward’s growth? People choose to live in places that can offer them a good quality of life, and there are people moving to the area every day. When I grew up here, there was little residential in the heart of downtown Fort Lauderdale. Las Olas would close at six at night, and most stores closed in the summer. Things have changed dramatically, but we are still a young community. With the growth that we’re seeing downtown now, there’s enough of a concentration to generate significant residential in downtown. My genuine belief is if you’re not growing, then you’re stagnating, which no community wants. Our next step is to invest intelligently in infrastructure. Technology has changed dramatically just in the last decade and can make a huge difference in the quality of life of our growing community In what ways is Broward becoming a more recognized economic power? We have three new headquarters in Broward County that represent the high-paying skilled jobs that are part of Broward’s tourism and leisure industry. Virgin Voyages, Richard Branson’s new cruise line, is building three ships at $1 billion each and has decided that its new headquarters will be in Plantation. Then we have Sixt rent a car, which established its North American headquarters here in Broward in Fort Lauderdale. Lastly, JetBlue Travel Services announced that it will be based in Broward County. These are examples of the skilled tourism jobs we’re excited to be attracting. How is Broward handling the need for affordable housing? Broward County, to its credit, is putting an item on the ballot in November 2018 that will create an affordable housing trust fund. A lot of developers will build affordable housing if provided with the land and not slowed down by bureaucracy. If we streamline regulation and permitting, those opportunities will be more attractive. www.capitalanalyticsassociates.com
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ECONOMY OVERVIEW
Many Broward County businesses are monitoring tariffs, as rising prices of steel and other materials could have a signifcant impact.
Dreamers The Obama-era Deferred Action for Childhood Arrivals (DACA) program was set to expire in March 2018, but a Supreme Court ruling deferred that date by possibly as much as a year. However, there is still no plan for granting Dreamers permanent protection. With the nation’s focus on the Trump administration’s “zero tolerance” policy, which led to thousands of families being separated along the southern border with Mexico this summer, DACA seemed to be relegated to the backburner. However, in July the Center for Immigration Studies filed a lawsuit that would require the government to turn over data — much of it focused on criminal history — on those enrolled in DACA. With about 11,000 of the state’s 27,000 Dreamers living in South Florida, an end to DACA could mean a substantial economic hit to the region. According to a study by the Center for American Progress, Florida would suffer a GDP loss of $1.4 billion per year if DACA recipients were deported. 16 | Invest: Greater Fort Lauderdale 2019 | ECONOMY
Trade games On a brighter note, Latin America is entering a phase of economic recovery as recessions in countries like Brazil, Argentina and Ecuador come to an end. Higher commodity prices are spurring growth, and investment is no longer dragging, particularly among wealthy Brazilians. With Brazil remaining Broward’s fourth-largest trading partner as of August 2018, with trade totaling $767.79 million, this recovery is positive news. Though the U.S. economy is strong right now, businesses and investors are growing increasingly concerned about the Trump administration’s trade crackdown. The first round of tariffs levied on China — 25 percent on $34 billion in goods — took effect in July 2018, and a second round took effect on another $16 billion in late August. These followed tariffs imposed on U.S. allies Canada, Mexico and the European Union — to which the allies swiftly responded in kind. Tariffs on most consumer products have yet to take effect, but U.S.-based retail container ports — including Port Everglades — are seeing a marked uptick in activity in anticipation of rising prices. According to a 2018 Port Tracker report by the National Retail Federation, in June U.S. ports handled 1.85 million 20-foot equivalent units (TEU), a 1.6 percent gain over May and a 7.8 percent gain over June 2017. With a full-blown global trade war looming, some fear an economic slowdown could be just over the horizon. “Tariffs are a big issue,” Matthew Rocco, president of the South Florida Manufacturers Association (SFMA), told Invest:. “They affect a lot of companies down here. Steel prices are rising, and indirectly or directly our manufacturers are impacted. We are constantly monitoring this issue.” Cyber threats In the wake of a number of devastating cyberattacks launched in 2017 — mostly by Russia, North Korea, Iran and China — more than 30 high-tech companies, including Microsoft and Facebook, announced in April 2018 that they would not aid any government in mounting cyberattacks. In addition, they pledged to come to the aid of any nation on the receiving end of such attacks. While many business leaders, like Microsoft’s president Brad Smith, have been pushing for a “Digital Geneva Convention” to create rules for behavior in cyberspace, without the support of other tech giants like Apple, Amazon and Google, the movement has so far not gained momentum. Research company Gartner predicts that by 2020, more than 25 percent of identified cyberattacks on ( )
ECONOMY INTERVIEW
Vibrant economy How businesses in Broward are capitalizing on technology, diverse industries and a favorable tax environment while combatting issues like traffic and homelessness
Keith Koenig President – City Furniture Chairman – Broward Workshop
What are the biggest priorities for Broward Workshop? On the education side, the Broward Workshop is very strongly behind Superintendent Runcie, who has made great progress. Keeping that momentum going is something the Workshop is united on. On the other hand, a less unanimous initiative is the transportation sales tax. There are a number of members who support the plan and some who do not. Another big initiative is affordable housing. While we all recognize that it’s an issue, solving it will not be easy. A fourth issue is homelessness across Broward County, but particularly in downtown Fort Lauderdale. We all have compassion for homeless people who have run into challenges, and many individuals are chronically homeless. We want to be part of the solution. What are Broward’s greatest economic strengths? Most people don’t know that Broward County is really the technology hub of South Florida. We have some of 18 | Invest: Greater Fort Lauderdale 2019 | ECONOMY
the best tech companies in the world. That tech spills over to companies like ours. We have become a technology company that sells furniture. We have to be on the cutting edge of customer service, logistics, supply chain and all points of sale technologies. Broward County has the tech to supply the other industries within it. Of course, the marine industry is our treasure. It employs thousands of people and has a huge impact on our economy. The marine industry put Broward County on the map for a unique subset of the world’s population: people with big boats. They come here and spend money, which creates high-paying jobs. They struggle with getting Broward’s high level of service elsewhere. We have a large number of aviation companies in Broward County and across South Florida. We’re growing our financial services and healthcare sectors. We’re seeing more and more concierge medicine. Tourism is a given, and that continues to employ the largest number of people across South Florida and is continuing to grow. We are the beneficiaries of the synergy of this vibrant economy. How has the tax reform affected Broward? It has already had a dramatic effect. I’m part of the CEO Council, which comprises about 20 businesses that offer $50,000 a year in incentives to encourage major companies to locate their headquarters in Broward County. We’ve had a lot of success over the years, and it’s only going to get better because suddenly we’ve attracted more interest. A favorable tax environment has to reflect fiscally conservative management at the state level, and Florida reflects that. Entrepreneurs with financial service firms based in the Northeast are quickly realizing that their computers can be anywhere. The cost of doing business here is much lower, so we’re going to be more and more successful at attracting those firms.
ECONOMY OVERVIEW
David Henshall CEO – Citrix Systems Security is a high priority for us and all of our customers. The amount of digital content being created these days is increasing exponentially. Experts predict there will be more digital content — that’s everything from tweets and sensor data to movies — created in 2018 than in the entire history of the human race combined. That is a lot of data to organize, protect and turn into valuable information. ( ) businesses will involve the Internet of Things (IoT) but that IoT will account for less than 10 percent of IT security budgets. This gives businesses — both in Broward and across the globe — something to think about. With so many connected devices and protocols on the market, many from competing manufacturers, finding a way to secure the IoT network is a major and imminent challenge. For Broward — which is home to virtual reality startup Magic Leap, e-commerce pet supply company Chewy. com and tech heavyweights Citrix and Microsoft Latin America, among others — cybersecurity is a critical block in supporting this important industry.
“other services” (2,900 new jobs) and government (800 new jobs). In Broward, other services also experienced the fastest annual job growth among Florida metro areas, at 7.5 percent. The only industries that didn’t experience job growth in the county were education and health services, which lost 100 jobs, and the information industry, which experienced no change. The Fort Lauderdale area remains one of the top five Florida metro areas for private sector job growth. In the past year, the region added 13,300 new private sector jobs. It also offered the fourthhighest number of high-skill, high-wage STEM jobs, with 5,313 openings. Wages in the South Florida area grew by 2.7 percent for the year ending in March 2018. Life sciences — in particular pharmaceuticals and medical devices — remains a major economic driver in the region, with more than 1,500 bioscience institutions employing more than 26,000 workers and generating $4 billion in annual revenue. The marine sector, which supports 110,000 jobs, and the multibillion-dollar aviation and aerospace industry continue to grow as well. Arts and culture have also become an increasingly important pillar of Broward’s economy. According to a 2017 study conducted by Americans for the Arts, the arts and culture sector is a $414.2 million industry in Broward County. The combined $148 million of nonprofit arts and culture spending and $265.7 million in event-related audience spending supports 11,078 full-time jobs and generates $40.1 million in revenue for local and state government. There’s no
In July 2018, Florida reached a $1 trillion economy, making it the world’s 17th largest economy.
Nine-to-five As of July 2018, Broward County had added 14,100 non-farm jobs year-overyear, a 1.7 percent increase from July 2017. The area’s unemployment rate dropped to 3.7 percent in June, down 0.3 percentage points from the same time in 2017 and lower than the national rate of 4 percent. In early July 2018, Florida reached a $1 trillion economy, making it the world’s 17th-largest economy (outpacing countries like Saudi Arabia, Switzerland and Argentina). While job growth is currently the highest it has been since 2007, it was expected to slow a bit in 2018; however, as of August, the state had already added 180,200 new jobs. In Broward, the industries with the highest job growth through July 2018 were construction (4,100 new jobs) and professional and business services (3,300 new jobs). The area experienced the highest annual job growth among Florida metro areas in
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Mike Jackson CEO AutoNation
Why is Fort Lauderdale a great place to call home? The talent that exists here in South Florida is exceptional, and the university system is producing good employees. Culturally, we have the art museum, the Broward Performing Arts Center and the Museum of Discovery and Science. Most important is the sense of community that exists here in Broward County. It’s very diverse and accepting of diversity, but at the same time there is a genuine sense of community. There’s a cliché that people come to Florida to retire, but it’s not true at all. It’s a very entrepreneurial community that is open to new technology. We have everything we could want for a headquarters. Our founder loved Fort Lauderdale more than anyone. I like that we can drive around and see inspiration from him everywhere. What challenges face AutoNation today? Everybody is facing the exciting prospect of being disrupted by technology. AutoNation specifically needs to keep an eye on autonomous or self-driving cars, carsharing technology, digital experiences, new ways to acquire products and caring for and servicing our data. We’re investing tremendously in technology because we need to. There’s more change coming in the next 10 years than we had in the last 50. Now we’re taking our scale and brand and launching new business activities through brand extension, which covers everything from customer care products to AutoNation accessories. How are you honoring Wayne Huizenga’s legacy? AutoNation will have, over the decades, many CEOs but only one founder. We have a portrait of Wayne on the wall in one of our major conference rooms. When we get stuck, we just stop and look at the portrait and say, “What would Wayne do?” We are also continuing the company’s mission to find a cure for cancer. We’ve donated about $15 million to top research centers throughout the nation, and we want to keep that trend moving upwards. 20 | Invest: Greater Fort Lauderdale 2019 | ECONOMY
question that Broward has truly evolved into a global arts mecca. In fact, according to the study, 63 percent of nonresident survey respondents indicated that their primary reason for visiting Broward County was “specifically to attend an arts/cultural event.” Building business Broward County continues to promote itself as an attractive place to do business. Since the beginning of the 2018 fiscal year, the Greater Fort Lauderdale Alliance — Broward County’s official public-private partnership for economic development — has helped to foster $28 million in capital investment and to create 462 new jobs countywide. The Greater Fort Lauderdale Chamber of Commerce, Broward’s largest and oldest business organization, is also helping to promote future economic growth and development in South Florida. “The chamber is doing a good job of getting businesses involved in the Greater Fort Lauderdale community,” Joseph Eppy, president and chief visionary officer for the Eppy Group, told Invest:. “I think that many international companies are going to move to this area, especially due to the the trade zone, where we’re starting to do business with Italy and the U.K. We’re getting involved with the county to help put together a more comprehensive package to facilitate international trade.” In April 2018, a major technology company announced that it would seek taxpayer incentives to add 100 jobs in Plantation and make a $250,000
ECONOMY OVERVIEW
Broward County has 23 miles of sandy beaches and 246 sunny days a year, making it an attractive place to live, work and play.
capital investment to build out 8,000 square feet of office space. If successful in meeting these goals, the company would be eligible for $700,000 in tax rebates ($140,000 from Plantation and the rest from the state) over seven years through the Qualified Target Industry (QTI) program. Additionally, in January 2018 Amazon announced that South Florida made the shortlist of its top 20 locations for its new headquarters. While the company is already planning to open an 850,000-square-foot mega warehouse next to the Opa-locka airport in northwest Miami-Dade County (the project broke ground in 2018), its 8-million-square-foot headquarters on about 100 acres — which would create 50,000 jobs as part of a $5 billion investment — would be a tremendous boon to the region. Since the announcement, South Florida leaders have had more discussions with Amazon, and the company is expected to make its final decision by the end of the year. Shrinking middle class South Florida, like many other areas in the U.S., continues to struggle with the issue of economic inequality. According to a 2016 study by researchers at the Stanford Center for Education Policy Analysis, Florida metro areas were among the top in the country with the biggest increase in income segregation during the study period (from 2007 to 2012). Broward County ranked number nine, just behind Palm Beach County at number seven.
According to an Economic Policy Institute report, in 2015 the top 1 percent of families in South Florida earned, on average, 55.4 times as much income as the bottom 99 percent. Fortunately, area businesses are taking note and working toward closing the income gap and providing support to struggling communities. In April 2018, Citi Foundation named the Urban League of Broward County (ULBC) as a recipient of a $500,000 grant. The grant was part of the 2018 Community Progress Makers Fund, which supports high-impact community organizations that drive economic opportunities in their communities. ULBC plans to use the funds to further its efforts to prepare minority- and women-owned businesses for untapped procurement opportunities throughout the state, providing an economic boost to help sustain underserved communities long term. On the state level, in April 2018 Governor Scott announced the recommended designation of 30 census tracts in Broward County as Low Tax Opportunity Zones (LTOZs). These zones were established under the 2017 federal Tax Cuts and Jobs Act in order to encourage long-term investment and job creation in targeted communities by lowering taxes for job creators. “Entities that invest in these opportunity zones can defer capital gains taxes,” Joe Berkovits, partner at EisnerAmper LLP, told Invest:, “making them especially attractive for development. The proposed zones in Broward County include areas www.capitalanalyticsassociates.com
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ECONOMY OVERVIEW
of Fort Lauderdale, Pompano Beach and Miramar, among other areas that need an economic boost.” Climate change Despite the impact of Hurricane Irma in September 2017 and the ongoing threat of climate change, Moody’s Investors Service reported in early February 2018 that Florida’s bond rating would remain strong due to the state’s “strong economy, growing tax base and the federal government’s ongoing resources through FEMA to help cover the costs of storm damages.” Later that month, Moody’s reported it would be introducing new standards in order to integrate climate risks into its bond ratings. The agency warns that without significant efforts to reduce greenhouse gas pollution and build climate resilience, coastal cities could face such financial risks as default, loss of insurance and credit downgrades. South Florida has $30 billion in vulnerable coastal real estate and $46 billion in annual economic exposure. Hurricane Irma imposed a $7.5 billion economic loss on the region, including losses of $2.6 billion in household income, $4.1 billion in regional GDP and almost $900 million in forgone federal, state and local revenues. In preparation for the inevitable future storms and effects of climate change, Broward County is currently working on updating a Regional Climate Action plan, as part of the Southeast Florida Regional Climate Change Compact, that will help policymakers incorporate resilience into their planning activities. A major focus of this plan will be including social equity and racial justice recommendations, as communities of color and low-
income neighborhoods are particularly vulnerable to extreme weather events. Broward has long been on the frontlines of environmental resiliency efforts. In 2008, county leaders passed a resolution that established a community-wide greenhouse gas (GHG) reduction target of 80 percent below 2007 emissions, to be reached by 2050. It was also the first local government to adopt a stand-alone climate change element as part of its Comprehensive Plan. This element comprises 82 environmental policies for helping the community adapt and for mitigating the economic, environmental and social effects of climate change. The county remains committed to taking action in order to build safer, healthier and more prosperous communities within its bounds.
Hurricane Irma imposed a $7.5 billion economic loss on the region, including losses of $2.6 billion in household income.
Looking ahead Broward County is buzzing with innovative energy and economic growth as it looks toward 2019. Despite challenges, the global economy is on the rise, and Broward’s world-class port and airport are uniquely poised to capitalize on increased traffic, both passenger and cargo. Broward continues to be a tourism mecca, attracting both national and international visitors to its unique blend of sunshine, sand, culture, food and much, much more. With its thriving real estate and marine industries, bustling retail centers, innovative startup community, favorable tax climate attracting droves of new residents and businesses and leaders focused on sustainability, the future looks bright, indeed, for Broward County.
Kathleen Cannon CEO – United Way of Broward County
It is really important to the community that the businesses and nonprofit organizations in Broward work well together without egos and with open discussions on how to solve important social issues. The business community continues to step up because it understands the relationship between helping people and a thriving Broward.
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ECONOMY OVERVIEW
Bread and butter: Small businesses are the backbone of the nation’s economy, and Broward County is heavily investing in their future Small businesses — or those with 500 employees or fewer, according to federal parameters — are major drivers of the U.S. economy, numbering about 28 million nationwide and producing 50 percent of the country’s non-agricultural GDP. According to the Small Business Administration (SBA), these businesses employ 57 percent of private sector workers, or more than 56 million people, and pay out 44 percent of the U.S. payroll. They are also responsible for creating more jobs than larger companies. According to an August 2018 study by Value Penguin, Florida is the third-strongest state in the U.S. for small business enterprises (SBEs). The Sunshine State’s birth rate for SBEs is 118 percent, meaning that 18 percent more SBEs are opening than closing throughout the state. Florida also ranked second highest in the country for small business exports (69 percent of total exports), trailing only Montana (71 percent). South Florida ranks as the number one most entrepreneurial metro area in the country, according to a recent study conducted by FitSmallBusiness.
com, which analyzed data from the U.S. Census Bureau, the Kauffman Foundation and National Venture Capital Association. The region also ranks number one for new entrepreneurs, with 560 out of 100,000 adults starting new enterprises each month. For every 1,000 businesses in the region, 107.8 are small startup firms with less than one year of doing business under their belts. In Broward, specifically, 89 percent of the businesses are small, mostly mom-and-pop enterprises numbering fewer than 20 employees. “Every month across the United States, over 500,000 new businesses open,” K. Michael Chen, economic and business development manager for the City of Fort Lauderdale, told Invest:. “As you might guess, most are small businesses. Those 500,000 businesses a month represent over 65 percent of all the job growth in the United States. Over 80 percent of all the businesses in Broward County are small businesses with fewer than 10 employees.” Broward County’s Office of Economic and Small Business Development works to promote job growth,
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ECONOMY ANALYSIS
Peggy Nordeen Owner & CEO – Starmark International
Broward County is a very welcoming community, and so is Florida as a whole. It is important to get involved with the local chambers at the Greater Fort Lauderdale Alliance to make a connection that can help people learn about your business. Smart small companies need to take advantage of what CareerSource Broward and CareerSource Florida offer in terms of training grants and incentives. When you are a small company, it is difficult to find the money to do the continuous training that is required in this business climate. CareerSource Florida has a program, and the county government here can help.
diversify the county’s industrial mix and expand the local tax base. Recognizing the importance of small business to the local economy, its programs provide training and development to aspiring entrepreneurs, equal access to procurement opportunities for small businesses within the county and access to technical assistance and resources, among other
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services, in order to promote small business growth beyond Broward. Many local municipalities are also committing to supporting budding entrepreneurs. “We’re looking to broaden the employment base of the city,” Robert Massarelli, development services director for the City of Margate, told Invest:. “We want to bring in
CONSTRUCTION ECONOMY OVERVIEW
FLORIDA SMALL BUSINESS PROFILE 2018
2.5 million
small businesses
3.3 million employees
Sandy-Michael McDonald Director The Broward County Office of Economic and Small Business Development
926,002
minority-owned businesses Source: U.S. Small Business Administration
more businesses and job opportunities. We have a high percentage of immigrants, which creates a really interesting dynamic. There are many entrepreneurs who want to live that American dream. We want to provide opportunities for them to flourish here. We contribute to improvements to help start and grow businesses.” It seems these efforts are paying off, as the 2018 Biz2Credit National Small Business Week study ranked the Miami-Fort Lauderdale metro area number three on its list of Top 10 Cities for Small Business Growth. However, growth and survival are two different things. The aforementioned Value Penguin study ranked Florida number 34 in the nation for small firms’ ability to survive. At present, only 66 percent of Florida’s SBEs remain open after two years. On a federal level, December 2017’s sweeping tax reform, which included a 20 percent deduction for qualified business income for pass-through corporations, has helped to spur confidence among small businesses nationwide. In May 2018, the National Federation of Independent Business’ Small Business Optimism Index reached the “secondhighest level in the survey’s 45-year history.” In addition, this spring’s rollbacks to Dodd-Frank have lightened the regulatory load on the majority of the nation’s banks and freed them up to focus more on small business lending. Combined with an increase in alternative-lending sources like credit unions and online lenders, small businesses are experiencing a boost in access to capital.
How important is small business to Broward? The U.S. Small Business Administration (SBA) looks at businesses of up to 500 employees and calls them small, but in Broward County, 89 percent of the businesses have 20 employees or fewer. We have our big boys — the county government, the school district, the Broward Sheriff’s Office, American Express, Citrix and others — but we’re mostly mom and pops. That means when folks say the county is built on small business, it truly means that Broward survives, sustains and grows off small business. That’s why we have a small business program. How does the small business program support these business as they grow? We start by requiring businesses to operate in Broward for at least one year. We used to require that a business owner’s personal net-worth was $750,000 or less, but we recently expanded the program to create even more opportunities for small businesses. Now the net-worth matches the SBA’s $1.3 million or less requirement. We also wanted to make sure that even the smallest businesses have a chance to grow. Our Shelter Market Program for contracts under $250,000 allows for this. Bids are put out as SBE Reserves; both SBEs and nonSBEs may bid, but the intent is to allow SBEs to bid against businesses their size. If one of the small businesses presents a responsive and responsible bid, they get the bid before any non-SBE. Even in competition with larger firms, the little firms are given the edge. What challenges face Broward’s SBEs today? Scaling is really a challenge. As an owner, you can’t continue to work in your business. You have to work on your business. You have to grow your business. Access to capital is part of the challenge, but the other part is about businesses growing beyond their comfort levels. A lot of small businesses have some fear, but we see this as an opportunity and are willing to work with them to address it. www.capitalanalyticsassociates.com
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Andrew Taubman Principal Kaufman Rossin
How would you rate Broward County’s friendliness towards small businesses? Broward County has an extremely friendly business environment. The growth in this area, as demonstrated by the number of single-family homes and mixed-use properties being built, is indicative of what’s going on here. More and more people are going to move into this area because the cost of housing is 20 to 30 percent less on average than in Miami and Palm Beach County. Kaufman and Rossin partnered with the Greater Fort Lauderdale Alliance and sent out over 5,000 surveys to CEOs, decision-makers and owners of businesses. We analyzed the results, which indicate further growth in jobs and workforce. We learned from the survey that the majority of the respondents’ businesses are headquartered in Broward County, and 65 percent have been doing business here for more than 10 years, which indicates an environment where businesses can thrive. Also noteworthy is that over 70 percent of the businesses that replied said they expect to hire more employees in the next year. What do small businesses need to do in order to be successful in Broward County? My best advice is to get involved. Be a leader in the community and have your company involved in as many organizations as possible where you can have an effect. The business community is important, but make sure you support the charitable community organizations as well, like the United Way or LifeNet4Families. People who are donors like to do business with those who donate. Hiring the right talent is essential to being successful, and depending on the nature of the business, recruiting top talent is pivotal and can be a big issue. Finding the right talent doesn’t get easier. We’re dealing with millennials, which is another adjustment for business owners of a certain age. We think and problem solve differently, so it’s an adjustment you have to make. Get their opinions, and see if they would approach an issue differently than your first instinct. 26 | Invest: Greater Fort Lauderdale 2019 | ECONOMY
Broward County recognizes the importance of its small businesses beyond simply their financial contribution to the local economy.
However, even with a sunny outlook there are a few clouds in the sky. Some current and potential federal regulatory changes could have a negative impact on small businesses, including the recent South Dakota v. Wayfair case, which marked the end of zero sales tax for e-commerce businesses and could mean extra financial and compliance burdens for small online retailers. Additionally, the current administration’s international trade policy has sparked a tariff war with U.S. trading partners and has the potential to increase prices significantly on many goods and services small business depend on. Despite these challenges, small businesses are lauded as the “backbone of the American economy,” and Broward County residents and leaders recognize their importance beyond simply their financial contribution to the local economy. They are incubators of innovation, centers for community engagement and important opportunities for diversification of both product and staff. The future of South Florida is #shopsmall.
Real Estate: As one of the fastest-growing regions in Florida, Broward County’s commercial and residential real estate needs are steadily climbing. Property value is up overall, and new players seem to be coming from overseas as much as domestically. It’s no secret that big-box stores are closing and the retail market is changing, but investment in retail space is still moving forward. Similarly, a lack of developable land and growing e-commerce needs instituted a spike in demand for industrial space.
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High demand: With a growing population and steadily increasing investor interest, Broward’s real eastate market is hot going into 2019 Broward County is the seventh-fastest-growing area in Florida in terms of population, according to a recent report by Cushman and Wakefield, with an expected 1.8 percent increase to 1.98 million residents by the end of 2018. This growth outpaces Miami by 0.4 percent. Along with this continual influx of people comes increased demand for housing, inflating the prices of the area’s real estate offerings. South Florida boasts the highest home prices statewide, and prices have increased steadily for both condo and single-family options since September 2017. Rental rates also remain high — too high for many renters. Many residents are spending much more than the recommended 30 percent of income on their housing, and 44 percent of residents are less than a $1,000 emergency away from losing financial stability. To combat this shortage of attainable housing, leaders across Broward County are working on providing affordable solutions. On the commercial side, retail and industrial are continuing strong, despite dips in Q1 2018. A growing demand for updated office space — reflecting the trendy co-working environment preferred by many employees, particularly millennials — is driving 28 | Invest: Greater Fort Lauderdale 2019
| REAL ESTATE
the renovation or construction of new offerings in the market. Real estate is one of the top drivers of Broward’s robust economy and continues to look strong going into 2019. New blood Broward County’s buyers are coming increasingly from overseas. In 2017, 32 percent of home purchases were made by foreign investors, up from 27 percent the previous year. Interestingly, this rise comes in sharp contrast to a decline in foreign buyers in Miami-Dade County. The county to the south dipped from 69 to 51 percent over the same timeline. Lower prices and less congestion might be leading buyers to invest in Broward. Drew Melville, principal at Melville Law, P.A., told Invest:, “Investors from South America continue to be a large part of our international investment portfolio. Canadians and Turkish developers also have a strong standing. The biggest change I’ve seen recently is the increase in Chinese clients. South Florida has accessible airports, and if investors can fly here easily, then they will come here to make their U.S. investments.”
REAL ESATATE OVERVIEW
While the current political climate has made immigration more difficult, Denis Smykalov, owner of Wolsen Real Estate, doesn’t think this is dissuading foreign investors interested in the region. “Florida is a great option compared to many investment opportunities worldwide,” he told Invest:. “Sometimes people invest in a country but do not feel welcome there. That is not the case in South Florida; no one stares at foreigners here. Here you can enjoy the weather and the international atmosphere and have your money grow. Values have been increasing by an average of 9 percent over the last 25 years.” On the capital side, EB-5 funding, which allows foreign investors a pathway to citizenship if they create jobs in the U.S., is declining in popularity. Intensely popular in the years after the 2009 financial crisis, EB-5 funding allowed developers access to capital for lower rates than they could find elsewhere, and subsequently billions of dollars have been spent by foreign investors nationwide. However, amid complaints of corruption — including one Fort Lauderdale project, the Las Olas Ocean Resort, where 60 investors lost their investments and their chance at citizenship when the project was sold at a bankruptcy auction in August 2018 — the program has declined in popularity among both developers and foreign investors themselves. Developers are leaning more on traditional methods of obtaining capital, including borrowing from banks, which are more open to lending to developers now that the storm surrounding the 2009 crisis has subsided.
A strong majority elected Dean Trantalis as mayor of Fort Lauderdale in March 2018. Part of his campaign centered on guarding against overdevelopment and improving the city’s infrastructure to prepare for growth. The new administration cut a proposed residential tower by seven stories after taking office, and the same project, the Alexan-Tarpon river proposal, was almost pulled in June 2018. However, the parties involved were able to reach a last-minute compromise, lowering the number of future residents and promising a more aesthetically pleasing design. While many count this as a win for smarter development, there’s some concern that developers could be lured to more friendly cities in the county, leaving Fort Lauderdale lagging behind.
Property values increased 7.7 percent across Broward County between June 2017 and June 2018.
To buy or not to buy Property values increased 7.7 percent across Broward County between June 2017 and June 2018, slowing slightly from the 9.3 percent increase the year before. The communities leading the way were Hillsboro Beach with 12.1 percent, Hollywood with 9.1 percent and Fort Lauderdale with 8.7 percent. Pembroke Pines and Pompano Beach increased by about 8 percent each. This rise in value makes homeownership a more difficult goal for many residents of the area, and the problem isn’t unique to Broward. Nationwide in Q2 2018, affordability was lower than it has been since the end of 2008, and federal interest rate increases are also making things more difficult for homebuyers. Despite high prices across the board, 2018 has been a good year to buy condos in South Florida. With a high- ( )
Rodrigo Azpurua CEO – RivieraPoint Invest + Develop The appetite to invest in the U.S. is very high. In 2010, international people were not looking seriously at the U.S. because of the recession. Now, things have changed. Money from every country in the world is being invested here. In the U.S., the economic cycle is not defined by the country’s leadership. It certainly has an influence, but it’s not directly tied as it is in other countries. This makes the U.S. a safer place to invest, even in times of political uncertainty. www.capitalanalyticsassociates.com
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REAL ESTATE INTERVIEW
Stable and steady How Broward’s real estate market continues to attract development and will remain strong as long as developers choose the correct product in the right sub-market
Barry Somerstein Partner – Greenspoon Marder Broward’s economy will remain strong in 2019, which makes sense if you consider South Florida as a standalone country; its economy would be the 36th largest in the world. Our job growth has been very good, and our unemployment rate is one of the lowest in the country. What should developers be sure to consider before diving into a new project? From my perspective, there are a few issues that should be considered. It’s important to structure deals to minimize transaction costs and avoid increases in real estate taxes. A developer can save substantial sums in a transaction just by structuring the deal appropriately. Another important thing to remember is to make sure to inform and work together with local governmental officials and the affected community stakeholders with respect to the projects before going to public hearings asking for approval of the project.
What are your reflections on Broward’s current real estate market? There has been an incredible proliferation of apartments that have been developed in the downtown core of Fort Lauderdale, and millennials and empty-nesters are driving that demand. I expect that over the coming years, we won’t see anywhere near that amount of apartment development in that area. However, in the suburban markets, especially in western Broward, there is still a pent-up demand for apartments, as well as single-family homes. Generally, I think the Broward real estate market will be stable and steady. I believe we still have an undersupply of single-family homes. Although we do have a tremendous supply of new apartments in downtown, there is still a need for apartments in other Broward sub-markets. 30 | Invest: Greater Fort Lauderdale 2019 | REAL ESTATE
What impact do you think the rising interest rates will have on real estate locally? A modest increase in interest rates isn’t as significant as the media makes it out to be, but its impact on the stock market might affect public confidence. The thing that drives purchases is consumer confidence rather than modest adjustments to current rates. If you look at the recent interest rate hikes in relative terms, rates are certainly higher than they have been in the last few years, but from a historical point of view, they’re really not that high. Modest adjustments like we have so far experienced in 2018 will not have a tremendous impact on single-family purchases. However, they will have a larger impact on apartment development because of cap rate compression. I think a more important issue facing developers in 2019 than the recent interest rate hike will be making sure they develop the correct product in the appropriate sub-market.
REAL ESTATE OVERVIEW
( ) standing supply of luxury product and a strong dollar discouraging Latin American buyers, incentives are on the table and prices are negotiable, although this atmosphere is not expected to last. With less luxury product in the pipeline, competition will become stiff as the product is absorbed. The Related Group, known for its luxury condos, is dipping into rental projects, including mixed-use developments in FATVillage and on Las Olas, as condos are not as profitable at the moment. On the single home front, land scarcity is making things challenging. In 2017, 80 percent of housing permits were for multifamily instead of singlefamily homes. The only city with a higher percentage nationwide is San Francisco. A proposed apartment project in Lauderdale Lakes, which would have had approximately 400 units, was scrapped in favor of single-family homes on largerthan-average lots for the region. The 23-acre site is likely to be the last single-family development in the city for the foreseeable future, as the land was the last large vacant parcel left.
costs in Fort Lauderdale so high, and likely to get higher due to targeted slower growth, other cities throughout the county are likely to see Fort Lauderdale commuters move in to avoid the high prices. “One of our biggest challenges here in Broward is attracting talent from other areas of the country because housing is so expensive here,” Caroline Fleischer, managing principal at Cresa, told Invest:. “I’m excited to see the new concepts for affordable housing. We’re seeing projects that are dormstyle, where tenants have their own bedrooms but share common areas, which brings down the cost.”
Fort Lauderdale has the highest rental rates in the tri-county area, at nearly $500 above the national average.
Or to rent Florida is ranked 40th nationwide for renter-friendliness, according to a recent study by RENTCafe, and Fort Lauderdale has the highest rental rates in the tri-county area, at nearly $500 above the national average. Costs are high and continue to climb, providing a strong market for attainable and affordable housing development. With
Redefining retail As former giants such as Winn-Dixie and Toys-R-Us have closed their doors for good, there’s some concern that retail as the world knows it is on its way out. There’s no doubt that things are changing, with many landlords looking for tenants that offer services or experiences rather than goods that could be ordered online. Perhaps due to this adjustment, in Q1 2018 Broward County reported year-over-year declines in transactions, square footage and dollar volume, although the square footage indicator did increase in the City of Fort Lauderdale. Rents also decreased between Q1 and Q2 2018. Power center rents decreased by 1.9 percent, while mall rates dropped by 4.3 percent. On the other hand, strip mall rent increased by 2.1 percent, probably due to the service-
Michael Weymouth President The Las Olas Company
What have been some highlights for the Las Olas Company in 2018? We completed our new building on the corner of Las Olas and 8th Avenue, and we have another 16,000 square feet of retail space that we’ve brought to market, along with about 16,000 square feet of office space. We also opened our newest restaurant, Boathouse at the Riverside, directly behind the Riverside Hotel on the New River. That is one of four restaurants that have opened in the last 45 days, so there are 1,000 new restaurant seats that have been introduced to the boulevard in the last month or so. The energy is unbelievable. The nice thing is that it’s a diversified bunch of restaurants that have come to the boulevard, bringing a nice variety of both people and tastes. We are capitalizing on that energy. How has e-commerce changed your strategy in terms of the retail you’re looking to attract? E-commerce is not really impacting the retail we’re trying to attract because some of the retail companies that we’re talking to are market leaders in that area. People come to their stores to sample the goods — whether it’s clothing, high fashion or something else — and then they order it and have it shipped to their house the next day. I don’t know very many people who go into a store, buy a shirt and literally wear it out. To have it delivered the next day to your house is almost more convenient; that way, you don’t have to carry the bag around. Overall, we are well-positioned with our new product coming online to attract national brands, along with our existing product, which is mostly boutique. E-commerce is a way for a lot of these companies to be able to service downtown residents without having to take a huge retail footprint. What’s going on in the retail industry is disruptive, there’s no question about that, but there’s a solution to it. And we happen to be in a good spot to offer that solution. 32 | Invest: Greater Fort Lauderdale 2019
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In Broward, many retailers are starting to focus more on services and experiences rather than goods that can be ordered online.
based tenants that often rent in strip malls and are less vulnerable to competition via e-commerce. Despite these numbers, investments in retail are moving forward. Dania Pointe, an $800 million project in Dania Beach, will feature 1 million feet of retail on over 100 acres of land. The project will include traditional stores, service providers and restaurants, as well as hotel and residential space. This development is an example of the live-work-play model growing in popularity nationwide. A similar, albeit smaller, project broke ground in July 2018. The Grove at Miramar, a $15 million, 45,000-square-foot project, was a quarter pre-leased at the time of its groundbreaking and already had tenant agreements with a dental practice and a childcare facility. Office offerings While Palm Beach and Miami’s office markets sagged, Broward’s showed year-over-year growth in both sales and square footage in Q1 2018 and jumped 15 percent for number of transactions from 2017. Things calmed down slightly in the second quarter, with negative absorption throughout South Florida. “We’re seeing a trend where Class B office buildings are being bought and renovated,” DK Mink, president of Mink & Mink Inc., told Invest:. “This trend attracts tenants from the Class A market because the finishes and textures are more modernized than your typical
CONSTRUCTION ECONOMY OVERVIEW
Arden Karson South Florida Director CBRE
Class B space but with lower rental rates than Class A space.” Co-working services continue to climb in popularity and are disrupting traditional office rental options by providing tenants with flexible, short-term leases and amenity-driven space. Worldwide, there were 1,130 co-working spaces in 2011. By the end of 2018, 1.7 million employees are expected to be using around 19,000 co-working spaces globally. While this does condense more people into less space, the market has not been too affected, as many who utilize co-working facilities are part of startup or small companies that might otherwise be operating from individual homes. The co-working trend is also affecting traditionally leased offices. According to Kate Murphy, president of Collins Capital Partners, “The market has changed significantly in the last 20 years. Our tenants are looking for more efficient space; they don’t want as many large offices or large file rooms, but they do want more places where employees can come together and collaborate. They don’t need large file rooms or as many large offices.” New office spaces are in process in Fort Lauderdale, including remodeling existing structures as in the case of 100 and 110 East Broward Boulevard. The $47.3 million renovation will refinish 25 floors of offices, last retouched in 1999, breathing some fresh air into the market. Another project at 550 S. Andrews will be the largest office building constructed in Fort Lauderdale
What areas of Broward are seeing the most activity? On the industrial side, recently we have seen northwest Broward with increased activity. Coral Springs and Parkland are showing continued growth thanks to the nearby Sawgrass Parkway and I-75. There is also movement in southeast Broward near Weston for the same reasons. In Pompano Beach, we are starting to see rents increasing. That area is becoming a great alternative industrial location for many companies, and in fact, companies are moving from as far south as Miami. Areas near the Sawgrass, southwest Broward and Cyprus Creek are the main centers of office activity. In terms of development, Metropica is a major mixeduse project in Sunrise currently under construction. Once fully completed, Metropica will feature more than 670,000 square feet of office space. In downtown Fort Lauderdale, the Brightline station is a game changer for the county. CBRE is currently handling pre-leasing at FECI’s 101 Fort Lauderdale, a 190,000-square-foot office tower with direct access to Brightline’s Fort Lauderdale Station. Most of the major trophy CBD towers have traded. We are seeing a lot of new players come in who recognize the value of Brightline and that the City of Fort Lauderdale is encouraging new development. How is new technology changing retail? Clearly e-commerce has changed the landscape, but there still is a need for brick-and-mortar retail. In general, we need to look at retail with a slightly different lens. Although retailers do not need to keep as much inventory anymore, people still want experiences. Shoppers are seeing many more food, beverage and entertainment options. Retailers are creating fun atmospheres to get people in the door to try things on. Obviously, there needs to be some kind of equilibrium between what retailers pay in rent and what their sales are. www.capitalanalyticsassociates.com
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REAL ESTATE OVERVIEW
since the AutoNation tower in 2008. Plans include a large parking garage to service the tower and the courthouse nearby. Industrial matters In 2017, industrial real estate continues strong in Broward. With increased demand due to e-commerce and a lack of developable land, industrial continues to be a tight market. “Industrial real estate has a very low vacancy rate and a very high year-over-year rental growth rate,” Ryan Nee, vice president and regional manager at Marcus & Millichap Real Estate Investment Services of Florida, told Invest:. “In some instances, we have seen industrial properties sell for higher-persquare-foot prices than office properties, which at first glance seems counterintuitive. With the South Florida land constraints of the ocean and Everglade to the east and west, respectively, there is only so much land zoned for industrial use in South Florida. This, coupled with the age of e-commerce and many legacy industrial properties in urban areas being redeveloped into alternative uses, makes the industrial market outlook bullish.” There’s no question e-commerce is changing traditional industrial properties. For example, retailers
are looking to simplify the shipping process by having stores and warehouse space at the same location, meaning properties are getting larger. The direct vacancy rate ended the year at 2.8 percent, compared to approximately 4 percent the year before, and the price per square foot was at $9.41, a 10-year high. Things cooled off slightly in Q1 2018, as square footage transacted and overall number of transactions declined in Broward. However, new developments are coming, mainly in central and northeast Broward, which will likely be snapped up quickly. Bridge Development Partners bought a 10.2acre property north of I-595 from the Broward County Public School Board with plans to deliver the Bridge Point FLL Logistics Center in Q2 2019. Bridge Development Partners is working on another project, this one on a 40-acre lot in Pompano Beach. Another project in Pompano Beach, a proposed expansion of the Royal Palm Business Center, involves demolishing several single-family homes to make room for the needed industrial space and rezoning 2.6 acres of property. Residential making way for industrial sends a clear message about the current market demands.
REAL ESTATE OVERVIEW
Robert Given Vice Chairman – Cushman and Wakefield Inc. There is a lot of demand forecasted for senior housing, and we don’t have the supply yet. However, there are companies like Greystar and Alliance that are creating this housing. Those type of developments will not slow down too much due to the aging demographic. What tends to happen is that senior housing is built around those submarkets where the adult children live. They’re usually developed close to the more affluent communities. Hot markets will be downtown Fort Lauderdale, Plantation, Westin and Sunrise.
Hotel boom While over the past few years both domestic and foreign investors have spent billions on Miami’s hotel market, transactions have been slowing down in the Magic City due to a disconnect in pricing between buyers and sellers. Those developers in search of higher yields have been increasingly venturing north — particularly to Fort Lauderdale — to build luxury and mid-priced hotels, hoping to tap into both a domestic market and international markets from places other than Latin America. Fort Lauderdale offers an attractive hospitality proposition for many reasons, including the fact that property prices are generally about 30 percent cheaper than those in Miami for comparable products. In addition, major infrastructure improvements and investments — including the multibilliondollar expansion of the Fort Lauderdale-Hollywood International Airport, upgrades at Port Everglades and the recently opened Brightline service connecting Miami to West Palm Beach — offer connectivity, comfort and convenience to visitors from all over. It’s no wonder pwc ranked Fort Lauderdale number six — up 29 spots from 2017 — out of 78 U.S. markets to watch
for overall real estate investment and development in its 2018 survey of “Emerging Trends in Real Estate.” As if to pay tribute to this blooming interest in hotel development north of Miami, in July 2018 the new Seminole Hard Rock Hotel topped off. When the 638room project is completed in 2019, the complex will have 1,107 rooms, making it the largest in Broward County and the second largest in South Florida. Senior living Florida has the highest age-dependency ratio in the country, with 34 retirees for every 100 working-age people. With this high density of seniors, housing designed for seniors has become a pressing need. As of 2017, Fort Lauderdale, Hallandale Beach and Hollywood joined Pembroke Pines as members of the AARP Network of Age-Friendly Communities. These cities are working to improve accessibility and resources for older residents. One offering for seniors is a project by Ocean Land Investments. The 42-story development will include independent, assisted and memory-care units on Las Olas, Fort Lauderdale’s most popular waterfront shopping district. While some will be ( )
Market voices: Senior Housing
Jean Francois Roy
Founder & President Ocean Land Investments
One project we are working on is a high-rise, luxury senior living community called Riverwalk Residences of Las Olas. There is no good or bad time to build these facilities due to the large senior population. This will be a great project in Fort Lauderdale; we are creating an urban community to appeal to baby boomers. It’s all about lifestyle, so we plan to have a stateof-the-art gym, spa and a variety of organic food options. The building is right in the middle of downtown Fort Lauderdale, so residents will be able to take full advantage of the city.
Older adults want to remain in their homes and communities as they age. It is important their communities have policies, systems and services that allow them to continue to do the things they value. One of the biggest challenges facing older adults is isolation. A livable community is a place where people of all ages are able to go for a walk, shop, socialize and connect with one another. Although affordable and accessible transportation and housing options are a challenge that every community is facing, they are important components of a livable community. If we are able to make communities more accessible for an 80-year-old, we’re doing the same for an eight-year-old.
David Diestel
Regional President FirstService Residential
Laura Cantwell
Associate State Director for Livable Communities AARP Florida
When seniors are searching for residential communities, they’re looking for like-minded people who share their values. Seniors have different preferences. Some are looking for clubs and social interaction, so we provide incredible programming to bring these residents together. Others are looking for a quieter lifestyle with more privacy. Some want to be close to their families, so retirees are looking for a home where their families can come and stay with them comfortably. Some prefer age-restricted communities while others prefer multi-generational housing. It’s about providing choices, and offering the expertise to manage communities with different visions and lifestyle amenities and programming.
The demand for senior housing is a big issue here in South Florida. We have a lot of opportunities for affluent adults, but we need to keep focusing on affordable housing with services for both older adults and our workforce. The biggest challenge in the next five to 10 years will be the aging of 240,000 people from their 50s into their 60s. South Florida and Broward need to be ready and welcoming to people making lifestyle transitions.
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Gerald Stryker CEO John Knox Village
REAL ESTATE OVERVIEW
( ) able to take advantage of luxury developments like the Riverwalk Residences, others will need more affordable options, along with many other residents of Broward County. Meeting needs South Florida has the highest percentage nationwide of severely burdened renters, with 36 percent spending more than half their incomes on rent payments. In Broward County, the average rent as of April 2018 was $1,858 a month, which is a burden for households making less than $74,320 a year. While affordable housing is desperately needed, funding can be difficult to secure, and developers can make more money by creating luxury or higher-rent accommodations, even in a slower period for the luxury market. “Affordable housing projects are difficult to bring to fruition because a lot of the capital structuring is dependent on subsidies, which come mainly from the state, county or municipality governments,” Nelson Stabile, principal of Integra, told Invest:. “It’s highly competitive because there is a limited pool of funds available for all interested developers.” In November 2018, Broward voters will get a chance to approve an Affordable Housing Trust Fund to support future projects. This money would be used to fund projects county-wide. On the state level, the Sadowski Affordable Housing Trust Fund has been used for other statewide expenses, leaving little of the original funding for housing. A move to restore most of this funding to its intended purpose could make a big difference in establishing more affordable housing in the region.
Affordable housing is a challenge in Broward, where developers can make more money on luxury or higher-rent accommodations.
Growing neighborhoods Fort Lauderdale remains a hot market, with multiple office, residential and hospitality projects underway, but the new administration’s goals of slowing development might dissuade developers from continuing to start projects in the city.
Gregory West CEO ZOM Holding, Inc.
Where are we in Broward’s development cycle? We are late in the development cycle, and one thing that routinely happens when you find yourself late in the cycle is increased costs over time. The costs for land and building, as well as the permitting process, are strained. All those things make it difficult to have your numbers add up on development projects. This is both a challenge and an opportunity in the sense that we’re seeing more disciplined capital than in prior cycles, which makes it more difficult to raise money. It also means that the money being invested is being considered more carefully, which creates healthier markets. We’re also seeing that the investors are typically more seasoned. We’re not seeing novice developers entering the market. It’s being controlled by the larger, more established entities. What are some solutions for attainable housing? Developers are building denser projects in the urban core with smaller units, which lowers the aggregate price point into a range that is more attainable. Apartments today are more finally appointed than they have ever been, and the finishes are much nicer. People want to live connected with other people. They want a nice place in a polished building, but more important are big amenities, activities and a sense of community. If you provide that environment, people will accept a much smaller unit, and developers are able to provide housing for less. This concept doesn’t solve housing for the homeless or for the very bottom tier of income. That has to be solved by a collaboration between the private sector, government and nonprofits. What is your outlook for development into 2019? The pace of development of housing is slowing down and will continue to slow down into 2019 while the industry develops and delivers the many apartments under construction. That said, I’m very bullish and optimistic about the ability of Fort Lauderdale to create jobs and absorb the housing. I think the market will do well, but we have a lot of housing on the table to satisfy that demand. 38 | Invest: Greater Fort Lauderdale 2019
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Other areas of the county are showing significant growth, especially the western half. As Lloyd Berger, president of Berger Commercial Realty, told Invest:, “We represent product in west Broward. Two years ago, people would have thought you were crazy to work on a project in that area, but the space is leasing as quickly as it pops up. With traffic flow increasing, especially in the eastern portion of the county, the western area of Broward has become much more viable.” Metropica in Sunrise, the mixed-use Plantation Walk and City Center in Pembroke Pines all speak to the potential of Broward’s western cities. With prices increasing close to the water, many are looking for more affordable land farther inland. With the approval of the American Dream megamall in Miami Lakes, Margate and Miramar could see considerable investment from those looking to capitalize on the appeal of the future “largest mall in America.” Miramar has already seen some new developments. The Grove at Miramar, a 5.6-acre retail center, began construction in June 2018, and Lennar proposed a 385-home development in May 2018. In fact, in July 2017, Miramar had the highest average rents in the entire state of Florida. Looking ahead Real estate in Broward County is projected to remain strong in 2019. Residential remains hot, with a slight cooling in luxury and a major need for affordable housing options. With increasing interest from international buyers and the new federal tax legislation making Florida a more attractive home for those in high-income-tax states, demand is certain to continue to increase across the board. On the commercial side, industrial will remain a tight market, with the lack of land and additional need for distribution centers as e-commerce dominates the market. While many consider brick and mortar retail to be dying out, the country’s largest mall, including a water park and amusement park, was approved just south of the county line in Miami-Dade in the summer of 2018, signifying demand for traditional, as well as service-based, retail. Overall, real estate continues to be a driving force in Broward County, and the county continues to be a driving force in real estate nationwide. Catering to ever-increasing numbers of retirees, foreign investors and northeasterners looking for tax relief, the outlook for Broward County’s real estate market is strong moving into 2019.
Market voices: Experiential Retail
Elias Benaim Owner Becha LLC
Our strategy for retail is all about creating a lifestyle and upscale experience at Atlantic Village. We’re building a service-based plaza with renowned restaurants, a cigar launch, shared office space, artist studios, banks, chiropractors, an indoor playground and much more. If people are going out to spend money, we want them to have an incredible experience at the plaza, not just grabbing something from a store. We’re focusing on services to increase recurrent customer traffic, and since e-commerce is disrupting how people are buying, we want to offer a unique lifestyle with top-quality service so people will come and visit us on a regular basis.
Retail is shrinking a little bit and focusing more on the experience of the customer. Big-box retailers are falling by the wayside because people are doing more shopping online. On the design side, we’re seeing smaller tenant spaces and less specific layouts to allow landlords to have more flexibility when tenants move in and out. Retail is definitely changing, but it’s not going away. 2017 was a year of very high demand. There were no talks of troubles or overbuilding, which are starting to crop up in 2018. Construction costs have escalated 20 to 25 percent over the last four years, and land prices continue to increase as well. While the pace is still brisk, there are fewer projects starting in 2018 than the previous year.
Jarett Levan
President & Acting CEO BBX Capital
Andrew Verzura Principal VCM Builders
At IT’SUGAR, we specialize in ‘Retailtainment.’ We offer a unique experience — our doors are open, music is blasting, the merchandise in the windows is captivating and customers are engaged. Today’s goal for hospitality, retail and restaurants is to create an individualized customer experience. From a business perspective, there is so much opportunity in South Florida because of tourism and the continual migration into the state. We like to say that cold winters are good for South Florida, as the early months of 2018 were brutal for the Northeast.
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Construction: With such high demand for residential and commercial real estate in Broward County from the growing workforce and the area’s new residents, it’s no wonder the construction industry has stayed busy this year. There is certainly no shortage of demand, but labor and materials remain issues to watch if supply has any chance of keeping up.
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Meeting demand: Even with material costs on the rise and continued labor and land shortages, Broward County remains hungry for development As of June 2018, construction jobs in Broward County had increased 8.8 percent compared to the previous year, painting a clear picture of the industry’s continued activity. The region is growing, and with more people comes a greater need for residential, office, retail and industrial properties. Construction firms are working to make the most of available land, labor and materials in order to deliver the development that Broward County wants and needs to continue to grow into a major economic power in South Florida. Steel and skill Nationally, construction costs increased by 4.2 percent from Q1 2017 to Q1 2018 due to various factors, including lack of skilled labor, effects of tariffs and cost of land. Steel and aluminum prices have increased since June 2018, when the Trump administration imposed a 25 percent tariff on steel and a 10 percent tariff on aluminum imported from the European Union (EU), Mexico and Canada. Even if a company avoids purchasing materials from those regions, prices across the board have risen. In areas like Broward that are mainly going vertical in their construction 42 | Invest: Greater Fort Lauderdale 2019
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projects due to a scarcity of land, this issue hits especially hard, as steel is a key ingredient for highrise products. The extra money to purchase these materials needs to come from somewhere, and many developers will pass along that increase in price to their end users, further inflating prices in Broward County. After the tariffs went into effect, Harley Davidson announced it would begin manufacturing some of its foreign-bound motorcycles offshore to avoid the EU’s retaliatory tariffs, which were costing the company, on average, $2,200 per product. The American Institute for International Steel established a lawsuit against the current administration’s tariffs, claiming the tariffs are unconstitutional. While the tariffs are an obstacle for construction companies throughout the county, not everyone sees this as bad news. “The tariffs are causing a lot of concern right now,” Peter Dyga, president and CEO of Associated Builders and Contractors, Florida East Coast Chapter, told Invest:. “Many are worried about the possibility of higher material prices. However, I believe we sometimes have difficulty grasping long-term benefits at the cost of short-term frustration. ( )
CONSTRUCTION INTERVIEW
Responsibly built How Stiles Corporation is building for the future, evolving as land becomes more scarce and innovating in the areas of sustainable and tech-forward construction
Robert Breslau Chief Development Officer – Stiles Corporation How is Broward’s market performing? One of the biggest challenges in Broward is that the county sprawled out and then bounced back to the beach. Today, the county is experiencing the reality of running out of land, while our population continues to grow. We see really strong concentrations of office development up the I-75 corridor at the Sawgrass Market in Sunrise. The Plantation submarket also does extremely well for retail, residential and office. As far as multifamily and affordable housing growth, people continue to need housing options from a broad spectrum of affordability and product types, and that is one of the biggest challenges Broward has right now. Where do you build, not just luxury housing and moveup housing, but also affordable and workforce housing? There are underutilized corridors in Broward County right now, and the 441 State Road 7 corridor is a great example. It has good roadways and good connectivity to mass transit. On the warehouse/distribution front, we see continuing demand for distribution centers. Warehouse industrial land has gotten expensive to a point that it’s rivaling retail land in price. We see strong demand for more retail, and we are seeing average rents rising especially in in-fill corridors. Scarcity of land remains a challenge. Broward will continue to evolve as it grows, with many suburban traits being replaced with more urban projects. How is Stiles continuing to innovate? Our new downtown office and residential project had so much planning going into what that building should feel and look like from a technology standpoint. We’re using low-E impact high-performance glass, and we will be one of the few buildings in Florida to use it. One of the problems in Florida is heat; often, developers use reflectivity to keep the heat out, but glass technology didn’t keep up. This company developed a glass that is very light gray and almost clear, which meets energy and
impact codes. We’re excited about it and the technology we’re using to get the building a gold LEED certification. Most buildings with that certification were retrofitted to qualify. We’ll have that designation from the beginning. Technology-wise, it’s very innovative. There’s a DAS system going in, which means that cell service inside the building will be better than service outside the building. With a system like this someone with an office anywhere in the building can remain connected to their personal and secure Wifi network in any of the amenity areas. We are always trying to figure out what’s the next best environment and technology we can offer our clients. And in our new office tower, the amenity level we offer our tenants will be unsurpassed. We hope it sets the standard, not just for Fort Lauderdale, but also for Florida overall. www.capitalanalyticsassociates.com
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Beverly Raphael President & CEO RCC Associates
How does current demand for RCC’s services measure up against the company’s history? We are busier than we’ve ever been. We’re a 47-yearold company that has seen all the ebbs and flows in our niche over the years, and the last five years have been strong growth years. In 2018, we are projecting to top 2017. Particular growth is stemming from the restaurant and entertainment sector. We’re working on luxury movie theaters and food halls as a few examples. We are pretty busy here in our backyard between Miami, Fort Lauderdale, Pompano Beach and Delray Beach. There are a number of projects either under construction or starting construction within the next few months. What retail trends are standing out to you? We’re seeing what look like malls within malls. It will be different from what most consumers are used to because there has to be something that is going to draw the customer besides running in to pick up cosmetics or a new pair of jeans. There needs to be some excitement to it. These mall developers are planning on bringing in entertainment facilities so they’ll feel like retail amusement parks. It’s a different type of venue, which will be very positive for retail. Businesses are having trouble affording the rent of spaces with large footprints. Many are downsizing their spaces or are leaving those locations to go elsewhere. How has being a woman impacted your career? People look at women differently in a male-dominated industry, which is really any industry. People used to use my leadership as a tactic to undermine RCC, especially when we were bidding against them. However, our record speaks for itself. Men like working here because the atmosphere is a little less aggressive. We found we could get what we needed from our people by actually talking to them. At the end of the day, if a person does her job and people respect and like her, that’s the most important thing. 44 | Invest: Greater Fort Lauderdale 2019
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( ) I believe these tariffs will lead to a healthier steel market globally, which can only be a good thing for our industry.” Both steel and skilled labor are at a premium for the construction industry. As of June 2018, the unemployment rate in Broward County was 3.7 percent. With a rate that low, skilled laborers are in a good negotiating position, and the need for them is growing. “On the one hand, we’re delighted to see such low unemployment and happy to see folks being able to earn a good living,” Timothy Moore, president of Construction at Stiles Corporation, told Invest:. “However, it does provide a challenge to find enough skilled craftsmen. The law of supply and demand comes into play, so they are earning higher wages. However, it can also affect timelines. Let’s say typically there were 20 craftsmen working on a crew, but today, due to the lack of labor, there might be 15. Something that used to take five days now takes six or seven, which is going to extend the delivery timetable.” While Florida students have less debt than the national average ($24,041 versus $28,650 upon graduation in 2017), college debt nationwide is still climbing, and many are questioning whether a bachelor’s degree is worthwhile, especially when the booming construction industry is so hungry for new workers. Broward’s Associated Builders and Contractors is helping to supply this demand. In July 2018, it graduated 150 tradesmen, each with a job lined up. Five years ago, the program was graduating an average of 25 students a year. Bills, bills, bills Capital for this construction boom needs to come from somewhere. In the last few years, EB-5 funding, supplied by foreign investors in return for a path to citizenship, has waned in popularity, although it is still used in South Florida. Banks, due to a rosy economic outlook, are more willing to support projects than they were right after the recession in 2008 and have increased construction lending. As Jennifer Bales Drake, shareholder of Becker, told Invest:, “EB-5 is becoming obsolete. It is no longer a very viable funding strategy. Banks have loosened up money for lending, and there is a lot of private equity money from various places. South Florida has always had cash available for development.” Bank OZK, formerly the Bank of the Ozarks, a small Arkansas-based bank, is now the largest construction lender in the tri-county area. Since 2016, the bank has been doing large loans in metro areas across the U.S. and has out-loaned giants like JP Morgan and Wells
CONSTRUCTION OVERVIEW
Scott Skidelsky Florida President Balfour Beatty U.S.
Construction prices are rising in Broward and across the country, but cranes remain a common sight in South Florida skies.
Fargo. The company has approved loans for projects ranging from the Paramount Fort Lauderdale Beach ($63 million) to Brauser Maimonides Academy (over $6 million) and is showing no signs of slowing down. In March, June and September 2018, the Federal Reserve increased the federal funds rate, and today it is at 2.25 percent. These three increases follow three in 2017 and are part of rate hikes that have been occurring since late 2015. Before that, the fed rate rested at nearly 0 percent since the recession in 2008. While these rates are still relatively low (the highest in history was 20 percent in 1979), these increases elevate mortgage rates and can slow down demand for homes, as well as lending activity from banks. However, the possibility of rates continuing to rise might spur potential homeowners to make a deal now while rates are still low. Going vertical 2017 was a slower year for residential construction in South Florida, with 33 percent fewer projects begun than in 2016. However, Broward’s population continues to grow, increasing the need for residential space in the rental, condo and single-family sectors. In Fort Lauderdale, the new commission has pledged to implement smart growth and slow down development, which could increase already high rental and ( )
We’re on track to having the best year in over a decade by millions of dollars. Our performance has been incredible. We’re very fortunate that it looks like 2019 should be even better. We’re 100 percent sold for the next year, so we’re in a good place. It doesn’t mean that we’re not willing to expand to take on work, but we’re really focused on having smart growth. We continue to see a positive outlook. There’s always escalation in our business, and there are always outside areas that impact it. However, it’s usually not the tariffs or the labor market that impact a project. It’s really more about whether a development is timed right and if smart decisions are made for the project. Every year in January, general contractors receive notification that steel, concrete or some other resource will be going up in price by 10 percent. There’s no question that there is escalation. Part of our strategy has to do with using national strategic partners. That way we get the advantage of that buying power and can pass savings along to our clients. The speculation and the changing costs can impact our job if we’re in the pre-construction phase. Our job is to take that into account, proactively manage it and understand that we have to have options to offset those increased costs. Escalation will hit the more complicated projects that require more time to work out the details especially hard. For example, think of a parking garage. There are perfect shapes for a parking garage, whether it has high-speed or traditional ramps. However, if you’re working on an oddly shaped piece of land, the design will need to adjust, and then the efficiency of that garage gets worse. A normal parking garage could cost X dollars, but if your square feet per space goes up, it has become inefficient. It’s going to be tough for this fictional parking garage, which is only going to yield so much money, to work. In the meantime, prices may have fluctuated, causing more uncertainty about the viability of the project. The next layer is taking into account where you are building that garage. Each municipality will have its own requirements and codes. If you stick to core, understood locations, you can be very successful. www.capitalanalyticsassociates.com
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Market voices: Rising Costs
Dev Motwani
President Merrimac Ventures
There’s uncertainty in the market around the cost of construction. Anytime there is uncertainty, that adds a risk premium, and this further raises the costs, which are already high. Add to that rising interest rates and all of a sudden it makes it hard for projects to move forward. We’re going to see a number of projects put on hold. Maybe there’s a better time to build than right now. In addition, I think every business is feeling the effects of the low unemployment rate. That drives up your labor costs, which in turn makes it harder to find people. It’s a good thing that unemployment is low for the economy, but it presents challenges for companies that are trying to grow.
The cost of construction issue for us is focused on labor. With a limited, skilled labor force, there’s a war over talent for both leadership and craftsmen. This leads to increased prices across the board. We’re focused on figuring out how best to invest our resources to find and train craft. We’re also focused on recruiting. Unfortunately, people don’t always understand that a construction trade can lead to a very strong career. We need to raise awareness about how important and well-paying these jobs are to reprogram society’s view of the industry. At Baker, we have internal training and are focusing on mentorships for our craft. We’re looking at in-the-field partnerships between a veteran and someone new to the trade. The experienced workers have a heightened safety awareness and offer their experience to the new co-worker.
Gilda Pereda
President Emerald Construction Company
Kerri Smith
VP, Southeast Regional Manager Baker Concrete Construction
The projects we bid on at the end of 2017 are mostly underway. There was a rush to get them started prior to the majority of price changes going into effect. About 30 percent of the projects did get price adjustments due to the material suppliers being hit with tariff costs. Material costs, though, have continued to increase steadily, and the labor market has just not been that great, so we are dealing with bigger challenges heading into 2019. Labor is always a factor. As we employ a variety of different positions, from laborers to project managers, we see the effects of the current market at different levels. The problems seems to be centered on a lack of skilled tradesman and a shortage of qualified managers.
46 | Invest: Greater Fort Lauderdale 2019 | CONSTRUCTION
CONSTRUCTION OVERVIEW
( ) purchase prices for existing units while relieving strain on the city’s aging infrastructure. Development is already popping up around the Fort Lauderdale Brightline station. The FATVillage and Flagler Village areas are on the upswing but are receiving an added boost from Brightline’s proximity. With traffic increasing throughout Broward, more residential developers are drawn to transit-oriented development to offer their residents alternatives to driving. With land in short supply, many projects are going vertical to maximize the developable space left in the county. In a post-recession world, many are finding homeownership to not be worth the risk, so the rental market is currently strong. Municipalities like Deerfield Beach, Pompano Beach and Coconut Creek have hundreds of apartment units under construction. These cities, too, are running short on developable land, so multifamily projects are a logical step forward. Some single-family projects are in the works, although nationally contracts for single-family construction projects dipped by about 5 percent in June 2018. The Toll Brothers’s Rolling Oaks Estates
are being developed on two-acre lots in Southwest Ranches. The 4,500- to just under 7,000-square-foot properties will each sell for over $1 million and are projected to be completed in 2019. Adaptable design In 2017, a total of $5.7 billion was invested in new commercial developments throughout South Florida, a 27 percent increase from the previous year. Office vacancies increased slightly in Broward in Q2 2018, indicating a slowdown in office development despite several high-visibility projects, including the 550 S. Andrews Avenue tower and Florida East Coast Industry’s tower near the Brightline station. Office design has shifted toward open-concept models with fewer private offices and larger common spaces with amenities, following the co-working trend. “We’re starting to redo our own office space, and collaboration is at the front of our minds,” Brad Meltzer, president of Plaza Construction, told Invest:. “We’re adding a training facility, an employee lounge and a fitness center. Our lobby is going to have a hospitality flavor to it. We’re seeing a more communal environment in demand and adapting to it ourselves.”
Charles Reid CEO Current Builders
How have the steel and aluminum tariffs affected the construction industry? These tariffs are having a negative impact on the construction industry and housing affordability. Immediately after they were announced, the steel mills notified us that price increases were coming, and they have been significant. Some of these increases equal hundreds of thousands of dollars on a single project, and naturally someone must pay for it. Our projects are lump sum, so these increases are either absorbed or shared with our client developers. In the short term, we’re also seeing significant cost increases with aluminum, which is used extensively for window frames, railings, appliances, electrical wiring and much more. For our new projects, we are including the increased costs, but these will have to be passed on to the end user. For us, the most important thing is that most of our clients are understanding and supportive and are working with us on this issue. However, this has become a complex issue that could have long-term ramifications for the construction industry. How is Current Builders adopting new technology? Investing in the most advanced technology is essential to our mission. We have always been an early adopter of new advances, and most recently we have been integrating the latest virtual reality applications. These additions save time and money, while also enhancing safety protocols. Through these applications, communication is greatly enhanced through more collaboration between all the stakeholders. Less is lost in translation, and problems are mitigated much earlier in the timeline. The combination of these technologies gives us a greater capacity to forecast problems before they happen in the field, which offers tremendous cost savings. Recent surveys and data suggests that the construction industry will expect to see more change in the next five years than we have in the last 50. Advances are happening rapidly, creating a very exciting time for our industry. 48 | Invest: Greater Fort Lauderdale 2019
| CONSTRUCTION
This trend toward communal offices is packing more people into a smaller space, and many are touting it as a great way to increase collaboration within a company. However, a 2018 study published in the Philosophical Transactions journal found that face-to face interactions dropped by 73 percent in an open office plan and e-mail use rose as workers changed their habits so as to not disrupt their neighbors. This might have an impact on design choices moving forward. Industrial construction is in high demand as vacancy rates dipped to 3.9 percent in Q2 2018, down over 1 percent from the previous year. 1.4 million square feet of industrial space was under development in Q2 2018 throughout Broward County, including more than 480,000 square feet at the Exeter Property Group’s warehouse developments in Coral Springs. Bridge Development Partners has purchased more than 10 acres in Fort Lauderdale and plans to construct an industrial park on the site. The expansion of e-commerce and a healthy economy allowing large and small businesses alike to expand is increasing demand nationwide, but the lack of land in Broward makes these industrial properties all the more valuable. In Q2 2018, the average asking price was $8.29 per square foot in the county, up 3 percent from the previous year. The impact of e-commerce on retail has been significant, but developers are adapting by adjusting their design to make retail more accessible and experiential. For example, Dania Ponte’s second phase broke ground on July 12, 2018. The project includes retail, office and apartment space, offering the live-work-play model that is becoming more and more popular across the U.S. Building the future All in all, the construction industry is highly in demand but faces serious challenges in the labor and material cost arenas. Area leaders are working to train employees and encourage young people to consider construction work as a career while also utilizing new technology to decrease labor needs. For example, Current Builders utilized the tunnel form construction method in the University Pointe/Downtown Davie student housing project, completed in April 2018. This method, while not applicable to all projects, is good for repetitive designs and allows for a smaller labor force than traditional methods. Steel and aluminum tariffs have made construction more expensive but are necessary. With the hunger for new development in South Florida, many developers will absorb the cost of materials in order to create new product. Despite challenges, area construction companies are likely to remain busy throughout 2019.
Marine & Logistics: From global trade to leisure cruising, the economic impact of Broward’s marine and logistics services continues to bode well for the region’s international image. Despite turbulent trade deals, major shipping companies have not seen any negative impact, and the region continues to be a logistics hub for trade with Central and South America. Fort Lauderdale’s international airport introduced new partnerships this year, and Port Everglades yet again surpassed its previous year’s record in containers passing through.
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Marine & Logistics in numbers: Economy in numbers: Port Everglades, total containerized cargo (TEUs, 2008-2017): 2008
985
2009
796
2010
793
2011
881
2012
924 928
2013
1,013
2014
1,061
2015
1,037
2016
1,077
2017 0
200
400
600
800
1,000
1,200
Source: Port Everglades Commerce Report
Top-10 imports by trading partner by total value, 2017 ($ million): Honduras
$5,394
Dominican Republic
$3,278
Guatemala
$2,028
Brazil
$1,191
Colombia
$1,129
Italy
$956
Spain
$810
Bahamas
$610 $556
Portugal
$375
Chile
0
1,000
2,000
3,000
4,000
5,000
6,000
Source: Port Everglades Commerce Report
Top-10 exports by trading partner by total value, 2017 ($ million): Honduras
$5,247
Dominican Republic
$3,977
Guatemala
$2,769
Netherlands
$1,491
Virgin Islands
$1,177
Bahamas
$1,163
Panama
$1,109
Venezuela
$1,016
Colombia
$1,008 $732
Cayman Islands
0
1,000
2,000
Source: Port Everglades Commerce Report
50 | Invest: Greater Fort Lauderdale 2019 || MARINE MARINE&&LOGISTICS LOGISTICS
3,000
4,000
5,000
6,000
MARINE & LOGISTICS OVERVIEW
Global gateway: Broward’s marine, trade and logistic industries continue to grow, supporting the needs of the U.S. and its foreign trade partners The marine, trade and logistics industries provide great economic benefits to Broward County. On the marine side, the miles of navigable waterways, history of quality marine services, world-class industry events and proximity to the Caribbean all single out Broward County as a marine hub. This industry alone has an estimated economic impact of $8.8 billion on the county and $11.5 billion on the region. On the trade and logistics side, the county’s air and seaports serve as powerful hubs, providing a strategic location for shipments coming in and out of Central and South America and the Caribbean. In an increasingly global world, these industries are growing to keep up with the needs of the country and its foreign trade partners. Global turbulence President Trump campaigned on the idea that free trade deals hurt U.S. companies and manufacturing and delivered on his promise to instate tariffs to combat the perceived issues with global trade. The first tariffs were levied in January 2018, on solar imports from China, the EU, Canada and Mexico. In March, 25 percent tariffs for steel and 10 percent tariffs for aluminum were instated for all countries besides Mexico and Canada, but the
exemption for those countries lapsed in late May. They retaliated the same day with tariffs and duties of their own targeting the U.S. From late March to mid-August, the U.S. installed new tariffs or increased them five separate times on China alone. The International Monetary Fund (IMF) projected that the U.S. economy would continue to grow at 2.9 percent throughout 2018 but would slow down in 2020 and beyond due to the disruption of global trade that these policies represent. The INF also warned that international investment could be affected by these policies. As of August 2018, Maersk — the world’s largest shipping company — hasn’t seen any downturn in global trade, reporting a 4 percent increase in demand in Q2 in 2018. However, the company projects that the U.S. has the most to lose due to its demand for consumer goods produced abroad. While global trade might fall 0.3 percent, the U.S.’s international trade could fall up to 4 percent, which would be a huge blow to the economy. As the number one port in terms of revenue in Florida, Port Everglades is keeping a wary eye on the global trade situation. In August 2018, leaders from Canada, Mexico and the U.S. continued renegotiations of the North American ( ) www.capitalanalyticsassociates.com
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MARINE & LOGISTICS INTERVIEW
Going global How Port Everglades is using advanced technology and a big-picture view to compete in an increasingly global marketplace
Steve Cernak Chief Executive & Port Director – Port Everglades and will have better handling capacity, but the operation will not change from what we do today. It’s always surprising to people to see how much technology is behind the cranes. Technicians can monitor, through their phones or computers, what’s happening with any of the cranes. They can see if there’s an issue and how best to fix it.
How will technology change the port in the next few years? On the cruise side, we already have the mobile passport control app and global entry that we can use here. We’re the first port to offer those capabilities. We’ll be using biometrics and facial recognition to speed up boarding and security processes. On the cargo side, our terminal operators are using stateof-the-art technology to streamline the entry and exit gate processes. Security as we know it is going to change. Automation is inevitable. There are issues on the labor side, but in order to compete in a global marketplace, the use of technology and automation will be necessary. We’re getting Super Post-Panamax gantry cranes, which are much larger than the ones we have now 52 | Invest: Greater Fort Lauderdale 2019
| MARINE & LOGISTICS
How is Port Everglades continuing to expand its global reach? We are a north-south trade link port, so commerce with Central and South America is our bread and butter. Anything we can do to strengthen these relationships are positive for us. Our partnerships in this region are a win-win situation that will lead to future growth. However, even though we have strong ties to the Americas, this doesn’t mean we’re going to ignore the rest of the world. Asia continues to be growing market, but closer to home, we look at carriers that aren’t coming in here. Why are they going to other ports? Can we change things to make our port more hospitable? We are strong in the perishables trade, the northsouth business and apparel. We have to stand out from the other ports and make sure that the carriers get what they need to serve their customers. We work with not only Broward County Economic Development but also the Greater Fort Lauderdale Alliance and our chambers of commerce. We attend conferences all over the globe. There are constantly people from Port Everglades traveling all over the world to bring business back to Broward. We’ll go to embassies and work with their commercial attachés. We also work with American companies that might be offshore, looking to do business. We look at the big picture to bring more commerce to the area.
MARINE & LOGISTICS OVERVIEW
Port Everglades is the number one port in Florida in terms of revenue, which means it is keeping a sharp eye on tariffs and predictions that global trade revenue will fall in 2019.
( ) Free Trade Agreement (NAFTA) after talks that began in August of the previous year. In late August, Mexico and the U.S. reached a bilateral agreement, spurring Canadian officials to return to the negotiations. On September 30, the United StatesMexico-Canada Agreement (USMCA) was agreed upon by all three nations, although the U.S. legislature will need to ratify the treaty, a vote that is unlikely to take place until 2019. The treaty’s changes were not substantial, as the business communities of the three
nations hoped, although a few key changes were made, including stricter tariff conditions for automotive supply chain companies, stricter enforcement of labor standards and granting Canada’s agriculture markets more access to the other nations. Logistics hub Broward is within easy reach of much of Central and South America and is a little over 1,000 miles away from the Panama Canal, making it a logical distribution point
Craig Mygatt CEO – Sealand PortMiami is utilized for much of the east-west shipments, as it has the capacity for larger ships and can service that market well. Port Everglades’ strength lies with the north-south routes, especially for perishable and agricultural goods, because this port is good at moving freight through the system quickly. When shipping to and from Latin America, everything has to be efficient; produce needs to move quickly, and Port Everglades provides that speed.
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Phil Purcell President & CEO Marine Industries Association of South Florida
What is the impact of the Fort Lauderdale International Boat Show on the region? Last year, we delivered over 150,000 hotel room nights. 54 percent of the people who attend the Fort Lauderdale International Boat show come from outside Florida, so this is an event bringing in visitors from all over the world. We had over 1,000 attendees with a net worth of $20 million or more. 50 percent of attendees have a net worth of $250,000 or more. This tremendous demographic of over 110,000 people is brought together here in Broward for five days. This showcases Fort Lauderdale as a yachting destination, as well as the third-largest reef in the world that sits off our beaches. Aside from the marine industry, the event showcases the Fort Lauderdale Executive Airport, Fort Lauderdale-Hollywood International Airport and Port Everglades. New in 2018, NBC Sports Network will be filming during the boat show to produce an hour-long special that will air nationally in December. That’s a big deal, not only for the boat show, but for the community as well, as it brings more national and international awareness to our community. How is the Marine Research Hub enabling much-needed research? We created a memorandum of understanding with four South Florida universities and the three economic development organizations of Palm Beach, Broward and Miami-Dade and MIASF. The universities, as part of their MOU agreement, will engage in collaborative marine research. As state and federal dollars continue to decline for research, the universities should start leveraging the money that they have to work together instead of competing on similar projects. The economic development organizations are there to match scientists to entrepreneurs, philanthropists and venture capitalists who can help them take it to the next level through commercialization. If we forge these connections, we’re doing our job. 54 | Invest: Greater Fort Lauderdale 2019
| MARINE & LOGISTICS
for international transit. The global logistics industry in Broward employs over 20,000 county residents, and that number is projected to increase. Local educational institutions, like Broward College and Nova Southeastern University, offer programs focused on the logistics industry to produce qualified candidates for growth of the sector. Global Trade magazine named Fort Lauderdale as one of America’s best cities for global trade in the fall of 2017. Florida East Coast Railway provides service from the port and airport to CSX railways and facilitates the transportation of goods up to Jacksonville and beyond. The success of Broward as a logistics hub stems from Port Everglades and the Fort Lauderdale-Hollywood International Airport (FLL). These two institutions are instrumental in creating convenient and safe logistics processes in the area. By air FLL’s trade totaled $2.75 billion in 2017, and its top trade partner by far was Brazil, with a 72 percent share. As of June 2018, Brazil remained on top, with 63 percent of FLL’s trade, and others such as United Arab Emirates, Sweden, India and the U.K. rounded out the top five, with 2 to 4 percent shares each. Top exports in the first half of 2018 included aircraft parts, computers, orthopedic equipment and jewelry. Top imports included aircraft and satellites, handguns, cell phones and gold. In 2017, FLL processed 107,860 tons of cargo, up from 92,245 tons in 2016. As of June 2018, the airport had handled 59,396 tons, outpacing the previous year. In September 2018, Miami-based air cargo management company FlyKargo announced an innovative new partnership with JetBlue Airways to help facilitate cargo movement between Fort Lauderdale and San Juan, Puerto Rico. The deal is part of a three-month pilot program to begin on October 15 designed to leverage the excess cargo-carrying capacity of JetBlue’s more than 250 planes. FLL is currently undergoing a large renovation, pouring $74 million into a project that will shut down one of its two runways from June to October 2019, along with other improvements throughout the facility. The airport has announced that domestic, not international, flights will take the hit, so international trade should not be affected by the short-term pain caused by the improvements. By sea 2017 was a good year for Port Everglades. The facility surpassed its previous record with over 1 million containers passing through the port yet again during the fiscal year. Petroleum volumes increased to over 122 million barrels over the same period. Amazingly,
MARINE & LOGISTICS OVERVIEW
one-fifth of Florida’s energy comes from petroleum that was handled at Port Everglades. Top trade partners for containerized cargo were mainly Central and South American countries, including Honduras and Guatemala in the top two spots. Also on the list was Italy. Thanks to the port’s traffic and facilities, Global Trade magazine named Port Everglades one of its top 50 power ports in 2018. In Q2 2018, the National Oceanic and Atmospheric Administration (NOAA) installed advanced sensing technology at the port, which provides mariners with real-time tidal, water level and current information. Before the equipment was installed, the most relevant data came from Virginia Key. The addition of this technology provides important safety information to those using Port Everglades, but it will also collect data over time, adding to the regional knowledge of our waterways on which the county depends. The port is in the middle of a $500 million, multiyear renovation of port facilities to accommodate the larger vessels that now have access to the area thanks to the expansion of the Panama Canal in 2016. In July 2018, the port announced the purchase of three Super PostPanamax container cranes, which have the capacity to reach across 22 units and stack containers eight high, allowing the port to use space more efficiently. The cranes are valued at approximately $14 million each. The expansion, which is the largest in the port’s 90year history, also encompasses doubling the length of the Southport Turning Notch from 900 to 2,400 feet, which will allow larger ships easier maneuvering ability and will add an additional five berths, increasing the port’s capacity and boosting its economic impact. The southport turning notch extension is scheduled to be completed in 2022. The port is also deepening and widening its navigation channels to accommodate larger vessels, with the process forecasted to last three to five years. The first phase of the project is set to begin construction in 2019 and will involve the reconfiguration of the Coast Guard station to allow easier navigation for large vessels. Despite the interruptions, local operators are pleased by the changes. As Christopher Roland, president of ILA LOCAL 1526, told Invest:, “Before they started the renovations, port authorities prepared us well and gave us plenty of time to prepare for what was coming. Dust and traffic have been issues, but for the most part we don’t look at it as a problem. We know the end result will be a larger terminal with faster cranes, which means more work for our guys.” The port’s systems have been upgraded as well, allowing the on-land handling of shipments to run more smoothly. “Now a single system runs our gate
Eric Fabrikant COO SEACOR Holdings Inc.
SEACOR Holdings formed CLEANCOR Energy Solutions approximately four years ago as a business focused on development, distribution and providing solutions that accelerate end-customer adoption of alternative fuels. We see plenty of developing opportunities here in South Florida for CLEANCOR. When we started the company, there were not any LNG liquefaction facilities in South Florida, but now there’s a facility in Hialeah and two located in Jacksonville supporting the LNG container vessels trading to Puerto Rico and other islands. CLEANCOR can bring the Jacksonville production to South Florida by truck or intermodal (ISO) containers. We see a number of opportunities to support the growth of South Florida’s economy by providing industries, such as over-the-road transportation and industrial equipment, with access to affordable and cleaner LNG fuel solutions. While our current focus is on supporting distribution away from the marine industry, we also see an opportunity to partner with Port Everglades to make sure the port is competitive in offering LNG as a marine bunker fuel for vessels calling on the port. In the last 12 months alone, the industry has seen over a dozen vessels ordered and under construction that will have the ability to burn LNG as its primary fuel source. Port Everglades, where SEACOR is headquartered, remains a very dynamic seaport and presents our organization with tremendous opportunities. Some of the ports we service in the Gulf Coast region are highly geared towards the importation and exportation of hydrocarbons and natural resources. On the other hand, Port Everglades thrives on its petroleum movement and cruise line activity but also plays a critical role in facilitating the import and export of containerized cargo and bulk products. Given the diversity in the types of the product loads, cargoes and customers served by Port Everglades, we intend to play a critical role in servicing Port Everglades customers now and in the future by bringing LNG fuel solutions to South Florida. www.capitalanalyticsassociates.com
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MARINE & LOGISTICS OVERVIEW
and our terminal operations,” Patrick Collins, general manager at Port Everglades for Crowley, told Invest:. “For our truckers, they now are dealing with a much more efficient process, which improves their turn time. Our trucker turn time went from about 90 minutes to under 40 minutes. We are able to run on a smaller terminal with larger volumes and quicker truck return times. We have fewer miles on all of our equipment moving around the terminal to manage the volume.” The port’s impact on the county cannot be overstated. Port Everglades was number 10 nationwide by volume of containers moved and number one in the state of Florida for revenue produced in 2017’s fiscal year. The port’s economic impact on the county comes in at $30.4 billion, and more than 13,000 direct jobs stem from its operations. As of June 2018, top trade partners for the year include the Dominican Republic (11 percent), Honduras (8.5 percent) and Chile (6.7 percent). Top exports in the first half of 2018 include vehicles, motorboats, computers and printers. On the import side, clothing, gasoline and motorboats ranked highest. In 2017, the port captured 0.6 percent of the U.S.’s total trade. Despite the renovations, things are picking up for the port; activity rose 6.24 percent in the first half of 2018 compared with the previous year.
from maintenance technicians and crewmen to yacht brokers and designers. The strong tourism market supports the marine industry as well, creating a need for boat charters and rental services for smaller vessels. Broward County alone has 300 miles of navigable waterways, and Fort Lauderdale is known as the Venice of the Americas for its attractive canals. Google recognized the value of those waterways and, in 2018, began to map South Florida’s waters from Jupiter to Ocean Reef. As of August 2018, South Florida’s waterways are the only ones in the world mapped by Google. The service works just like Google maps for roadways and will make navigating South Florida by boat even easier for those unfamiliar with the area. It could also boost business for waterfront restaurants in the region. There are over 50,000 registered vessels in Broward County, and about 2,000 yachts over 80 feet in length visit the county yearly. Each visit by these superyachts typically generates more than $450,000 in the county due to marina space use and maintenance needs of larger boats. In response to the industry’s impact, the county’s educational institutions provide opportunities to engage Broward residents with the marine industry. On average, a tradesman trained in the marine industry makes 28 percent more than a tradesman working on land, so marine jobs are both in demand and pay well, making them a popular choice. Broward’s educational institutions are taking note and providing programming for those interested in the
There are over 50,000 registered vessels in Broward County, and about 2,000 yachts over 80 feet in length visit the county yearly.
Marine magic The marine industry is a huge part of Broward’s economy, with an estimated $8.8 billion annual impact on the county and over 110,000 jobs supplied,
Jessi Blakley Vice President – Tavistock Group This is a really incredible project for us. We’re working on 32 acres of waterfront property in Fort Lauderdale adjacent to Port Everglades at the entrance to the beach. Pier Sixty-Six has a history, and everyone who grew up here has a memory of this place. We look for incredible opportunities where we can make something even more incredible than it already is, so Pier Sixty-Six made perfect sense. We’re focused on how we can re-create Pier Sixty-Six as the social harbor of Fort Lauderdale.
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MARINE & LOGISTICS OVERVIEW
marine industry. Broward College’s Marine Engineering Management Program allows students to graduate in 24 months with an associate’s degree and marine certifications from the American Boat and Yacht Council. McFatter Technical College offers training for outboard engine technicians, drivetrain technicians, marine riggers and more. New River Middle School, located in Fort Lauderdale, has a magnet program for middle school students interested in the marine industry that introduces marine careers to children early on in their education. Resolve Marine Academy, part of the Resolve Marine Group, has trained over 35,000 personnel at its facilities, which include bridge and engine room simulators. With the marine industry as prominent as it is in the area, it’s no surprise to find local businesses investing in employee training in the county. Yachting life The presence of yachts accounts for $3 billion in annual wages in Broward County alone. WIth maintenance, crew costs and updates, yacht owners can expect to spend at least 10 percent of the purchase cost of the yacht yearly. The waterways of Broward County will continue to attract prospective and current yacht owners to the area.
“People have maintenance done on their yachts here, but that’s just one piece of the puzzle,” Megan Lagasse, marine director at Pier Sixty-Six Hotel and Marina, told Invest:. “A crew of 20 people per vessel are eating, getting haircuts and renting cars here. We don’t want to be just a place where you dock your boat. We want you to pull up to our docks and have multiple restaurants and shops within walking distance.” The Fort Lauderdale International Boat Show plays a huge part in the yachting culture, and the event is only growing more popular. In 2017, the event attracted 105,000 guests from over 50 countries, an increase of 7 percent from the year before. More than 1,400 boats were displayed, making the event the largest show in the world in terms of exhibitor space and number of vessels. The show, which is owned by the Marine Industries Association of South Florida, supports over 125,000 jobs and contributes more than $11 billion to the local economy. The 2018 show will run from October 31 to November 4, and a few key changes include a newly revamped entrance with more effective security and a VIP entrance. The old entrance will be used for exhibitor logistics, which will improve flow for visitors and exhibitors alike.
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®
oundtable:
Fort Lauderdale is known as the yachting capital of the world, and the marine industry is a main driver of the county’s economy. However, even the county’s golden industry is not without its challenges.
Marine Challenges James Brewer Director of Business Development Derecktor Shipyards
Yacht size increasing is one of our biggest challenges. Vessels are getting bigger, and if we don’t have the ability to lift them, they’re going to go somewhere else. We need to make sure that the needs of our customer vessels are being served. The Greater Fort Lauderdale area is the largest hub of marine business in the world, with over 600 marine industry companies. We are one of the largest physical shipyards, but still we are constrained by space. What was unthinkable 10 or 15 years ago in terms of size has become standard. Our original buildings were built for the future in terms of size, but nobody predicted how severe this explosion of the size of vessels would be. We are often constrained by space and find ourselves in a position of having to turn business away. Obviously we hate to do that because it has a negative effect on the industry as a whole and gives the region a bad reputation. Certainly there are developments in the tri-county area. Miami and Palm Beach have had some investment in terms of larger shipyard development, so there are facilities around with which we can collaborate. If we work together as an industry, which we have a good history of doing, there is no reason we can’t provide those services. 2018 has been a little bit challenging due to last year’s hurricane season. A lot of our business comes from the Caribbean vessels coming across from the Mediterranean for the charter season. Some of those boats did not come because they heard about the devastation in the Caribbean. The charter season in the Caribbean was certainly significantly less than in previous years. When people ask me what’s our greatest attribute, I say location. You can provide great service, but if you’re not in the right place, you won’t be successful. There are always going to be boats in this area. We just need to make sure that we’re consistently delivering good service to all sizes of vessels coming to us.
58 | Invest: Greater Fort Lauderdale 2019 | MARINE & LOGISTICS
MARINE & LOGISTICS BANKING & FINANCE ROUNDTABLE ROUNDTABLE
Walter Duke
Joseph Farrell, Jr.
President Walter Duke + Partners
President & CEO Resolve Marine Group
There’s been tremendous activity in the marina sector. We’ve seen many transactions and an increase in rental rates and occupancy since 2012. New dock and marina space is being introduced with a number of marinas under construction, especially mega yacht marinas. As the yachting capital of the world, it’s important that we maintain that title on a daily basis and earn it every day. The marine industry is a $10 million industry in Broward County alone. It supplies 110,000 jobs, which is second only to tourism, and those jobs have 28 percent higher wages than the state average. The annual boat show in Fort Lauderdale is one of the largest in the world and has an annual economic impact approaching $900 million. That’s the size of two Super Bowls every year right here in Broward County. The marine industry has a huge impact on this county, which is why there’s definitely a concern about losing marine industry land to development. I understand the development community’s attraction to the waterfront because the river is a beautiful amenity. Good-quality development is important, but once you lose a boatyard or a marina that’s along the river, it’s not coming back, and neither are the jobs or economic output. We need to be mindful of preserving our marine waterfront land. We also need to be mindful of the property rights of these boatyard owners. Imagine yourself as a waterfront commercial marina owner approached by a third party to sell your property for a significant amount of money. It’s a hard thing to turn down. Moving forward, local government could play a role by creating a program outlining transferable development rights to allow the working boatyard to sell those rights to a third-party developer and then maintain their property as a boatyard.
We’ve always been headquartered in Fort Lauderdale. Our office on 17th Street oversees all of our global operations, including Europe, the U.K., Singapore, China, India, Gibraltar, Spain, Alaska and South Africa. It’s a busy place. Fort Lauderdale has always been a strategic location for salvage given the access to the Caribbean and South America, and as we grew globally it always stayed as our place to live. With so much vessel traffic, cruising and so many yachts down here, in our early years this was the place to start our business. Fort Lauderdale continues to thrive as a leader in the maritime world. There was a time when some of our biggest competitors in the world were also based here. That’s no longer true, but we have a strong affinity with Fort Lauderdale and would never leave the area. However, marine space is getting tight. There’s more and more pressure on the marine services businesses. If you have commercial ships or barges, today you’re keeping them in Dania Beach or in Miami. Relative to other nations, the U.S. has very stringent environmental rules known as OPA 90 or the Oil Pollution Act. These rules affect how ships navigate around the nation and minimize incidents. Our rules are so strict here that there are very few accidents, which means a smaller need for salvage. While much of our work is done overseas, we do have a local presence as well. We are the go-to salvage partner for the U.S. Coast Guard, and they are one of our bigger clients right now. Besides all the work that we did for them during the record-breaking hurricane season in 2017, we’re constantly picking up jobs for them. We live in a great country that steps in during the aftermath of natural disasters. The federal government hired contractors like Resolve to take care of issues in Florida and the Virgin Islands. We lifted thousands of boats that were stranded all over sectors of Florida and the Virgin Islands in a relatively short time.
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Paul Flannery Executive Director International Yacht Brokers Association
How do yachts impact Florida’s economy? When a yacht comes to the community, it’s an economic engine. The general rule of thumb is that the owner of a yacht will spend 10 percent of the value of that yacht in the local economy each year. In the first year of his ownership, he’ll inject an additional 13 percent of the value of the yacht into the community because he wants to upgrade and personalize the boat to his own tastes, but of course the guy who buys it might rip half of that out and start again. The largest economic driver in the state of Florida is tourism. The number two industry in this state is the marine industry, which provides a $17.2 billion annual economic impact and is responsible for 202,000 jobs within the state. In Broward, Dade and Palm Beach counties, that’s an $11.2 billion economic impact responsible for 136,000 jobs. Those jobs typically pay about 28 percent more than the equivalent job in other industries, partially because of the technical aspect of it. How is the International Yacht Brokers Association removing barriers to commerce? We recognized through an economic impact study that we did in 2008 that a large number of the people who bought boats were seeking other places to register those boats for tax relief. So we lobbied the State of Florida to put a cap of $18,000 on sales tax. That cap was enacted on July 1, 2010. Now you can buy a boat of any value in the state of Florida, and you pay only $18,000 in sales tax. The operating budget for the boat enforcement unit, the Department of Revenue, in fiscal year 2009 was $1.3 million. In fiscal year 2010, measured from July 1, 2010, until June 30,2011, the department collected $7.3 million in sales tax cap revenues. Many more people bought their boats and registered them here. People decided to pay the sales tax in the state of Florida, which enables them to leave the boat in state, which in turn captured quite a lot of revenue 60 | Invest: Greater Fort Lauderdale 2019
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Ongoing challenges While the marine and logistics industries are bulwarks of Broward’s economy, they are facing their own challenges. Global trade insecurity could increase rapidly, affecting the flow of goods in and out of the county. Land for development is disappearing rapidly, limiting options for companies with logistical needs for industrial real estate. On the marine side, a growing demand for development has caused many waterfront properties to convert from marinas to residential buildings. This decline has caused concern in the local marine community. Roger Moore, the owner of Nautical Ventures, told Invest:, “We’re losing some marinas to development, which is a gentle push away from this mecca of marine services, especially for the transient boats that come here to be serviced. We need to recognize that if we don’t perform, we are going to lose clients. They have other areas in Florida where they can go to get these same services, some of which have more land and larger facilities to accommodate bigger boats.” White blotch or white plague, an unknown disease, has been ravaging coral off southeast Florida’s shores since 2014. The coral provides a habitat for many species of sea life. The reefs help to protect coastal infrastructure during storms, support over 70,000 jobs and have an economic impact of more than $6 billion on the state. Researchers from NSU are working hard to save the remaining coral and grow young coral in the lab to establish new reefs once the damage is done. For both industries, South Florida’s hurricane season can prove an expensive challenge. Anthony Vrban, vice president of operations for Horizon Terminal Services, told Invest:, “We have millions of dollars in new cars sitting on our terminal. How do we make sure that they’re protected? Here in Port Everglades during Hurricane Irma, we had around 500 cars that needed to be protected. We worked with the port by borrowing their parking garage and driving them all in there. Weather is definitely a challenge, and we just try to brace for it.” Conclusion The marine and logistics industries are both strong drivers of Broward County’s economy. The physical location of Broward and the infrastructure that has grown up to support these industries combine to make the county a leader in the logistics and marine fields nationwide. As both the Venice and the gateway of the Americas, Broward is poised to grow even more in these industries as advancing technology, e-commerce and the ever-popular Fort Lauderdale International Boat Show continue to drive demand.
Market voices: Yachting
Bob Denison
CEO Denison Yacht Sales
Sales are up in our firm and others here in South Florida. It’s a healthy time to be in yachting. We didn’t see much of a dip in sales due to last year’s hurricane season. It affected inventory, as there were fewer boats available for sale, and insurance companies were a little skittish for a time. Boating is only getting more safe, more comfortable and more fun long term. The baby boomer generation is starting to retire with discretionary income, which is a boost for the yachting industry. We’re keeping an eye on the consumer confidence aspect because whenever there is political uncertainty there can be fluctuations. Overall, the future is bright for Fort Lauderdale and beyond. This place I call home will always be considered the yachting capital of the world.
The evolution of the marine industry in Broward County over the years has been extraordinary. Yachts have gotten bigger, and many of these superyachts can’t go up the river to be serviced. Now with advanced technology and equipment, including dual generators, refrigeration and watermakers, these vessels have every convenience, which allows their owners to spend weeks out at sea. Fort Lauderdale used to be regarded as the fishing capital of the world because we caught white and blue marlin 100 yards offshore. Today, you can’t find a blue marlin nearby even with the most advanced equipment. They’ve been fished out. Now you have to to travel to other countries to get that experience, which requires bigger and faster boats.
Jon Burkard President Allied Marine
Bob Roscioli
CEO Roscioli Donzi Yachts
There’s a lot of glamor in the yachts you can see in our marinas, but it’s important to recognize the amount of support industries that the average person doesn’t see. It’s amazing to see all of the companies in both east and west Greater Fort Lauderdale, including companies that fix engines, redo canvas, paint yachts, install new interiors and recertify life rafts. The list goes on. If your boat needs it, you can find it here. Clients who already own yachts will charter in different areas to avoid moving their yachts all the way to, say, Tahiti, for example. People want to live the way they want to live, so our staff will arrange special provisions for them, make appointments, create location itineraries and find restaurants and activities. People will also charter yachts to try them before they buy. With Allied Marine representing several brands, we normally have opportunities to do so.
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City of Pompano Beach: Roughly equidistant from Boca Raton and Fort Lauderdale, the City of Pompano Beach is perfectly situated for attracting new businesses and residents. With its new public spending mandates, development of a the Innovation District downtown (complete with trendy startups and smart development) and beachfront revitalization, Pompano Beach is poised to compete with any of the other city landmarks in South Florida. Private industries are beginning to take notice of the up-and-coming Pompano Beach.
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City to watch: The City of Pompano Beach is quickly emerging as an up-andcoming hotspot for trendy startups and smart development Pompano Beach is one of Broward County’s cities to watch in 2019. Conveniently located between Boca Raton and Fort Lauderdale, and with I-95 running through its heart, Pompano Beach is perfectly placed to attract businesses and residents. The city has substantial amounts of industrial real estate, which is currently in high demand throughout the region, as well as three miles of beaches, allowing it to benefit from the tourism, manufacturing and e-commerce industries. The city is also undergoing a lot of exciting changes, thanks to the passage of a general obligation bond, as well as the development of a new Innovation District downtown and the revitalization of the beachfront area. Private industry is taking notice of how this once sleepy retirement community born from agricultural roots has morphed into an up-and-coming hotspot for trendy startups and smart development. Pompano’s past The Tequesta Indians were the original inhabitants of what is now Pompano Beach. Their numbers dwindled due to disease and warfare when European explorers first entered the area. In 1763, many of 64 | Invest: Greater Fort Lauderdale 2019
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the survivors were transported to Cuba. A Tequesta burial mound is preserved in the Indian Mound Park, and in 2014 the site was added to the National Register of Historic Places. After the Tequesta, Seminole tribes were pushed down into South Florida by increased settlement farther north. Soon the Seminoles, too, were removed from the land to make way for European settlers. Frank Sheen, a railroad employee, is said to have given Pompano its moniker, naming the area after a fish he caught and ate there. Thanks to the railroad, which first arrived in the Pompano settlement in 1896, the community began to grow and officially was incorporated as a city in 1908, the fifth in all of South Florida. As Pompano grew after World War I, agriculture remained its strongest industry. Tourism became more of a driving force in the wake of World War II as the population continued to expand. The city merged with another settlement to the east in 1947 and officially changed its name to Pompano Beach. Attractive development Pompano Beach is no longer a sleepy agricultural town. The city’s vast industrial real estate offerings ( )
CITY OF POMPANO BEACH INTERVIEW
Resurgence How Pompano Beach is transforming from a small seaside community into a prime location for small business development and corporate relocation
Lamar Fisher Outgoing Mayor – City of Pompano Beach Why should a business owner consider Pompano Beach? I’ve been so blessed in my tenure as mayor to be able to meet with extremely large corporate entities and small businesses about locating to our city. When a major corporation relocates to your city, it’s very rewarding not only because the city receives the name recognition, but also because of the jobs created for the local community. At the other end of the spectrum, you have your small businesses that are just starting, and we work to nurture them as best we can. As mayor, my job is to sell my community, and that’s what I most enjoy about this job. Pompano Beach, for the longest time, was always considered a small seaside community. The beauty of its resurgence and growth lies in the fact that we’ve conserved that flavor. We don’t want to become stuffy and arrogant. We want to welcome you as a part of our community, and that’s the hometown feel that we still and will continue to have. Economically, it’s the most robust time to bring your business here. Business owners have the ability to come in and develop their framework. Today, we’re seeing these businesses coming to our offices wanting to be a part of our growing community. How do you work with neighboring cities to strengthen the region? There are 31 cities that make up Broward County, and it’s imperative that we work together. We work in conjunction with the Broward League of Cities, which has been a great conduit for all of us to understand each other’s issues and needs. We’re in touch constantly with the cities that border us, so I speak frequently with the mayors of Deerfield Beach, Lighthouse Point, Fort Lauderdale and Hillsboro Beach to discuss our common goals. For instance, we partnered with Hillsboro Beach to renovate our inlet bridge, a project that benefits both municipalities. We’re able to collaborate to streamline solutions across city lines.
To what do you attribute Pompano Beach’s growth? The vision for the transformation of this city was stewarded by the elected officials several years ago, but it was created by the community. We listened to what the community wanted, received their input and worked to make it a reality. To have that momentum slow would be devastating to our city. It’s most important that we continue to ride it together to fruition. Our beaches desperately needed renovation and redevelopment for our residents to enjoy their amenities. Now we’re focusing on an Innovation District that will be a major game changer for our downtown. The project will combine class A office, hospitality, market rate housing and retail and will set Pompano Beach apart in Broward. It also creates opportunities for job creation locally. Our efforts are dovetailing nicely with private development. www.capitalanalyticsassociates.com
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CITY OF POMPANO BEACH OVERVIEW
Greg Harrison City Manager City of Pompano Beach
We’re very excited about the impact the general obligation bond will have on our city. The measure will bring $181 million to 25 projects that have been needed for some time. The measure passed by a strong margin because the public understood, thanks to a strong educational effort by our staff, that these projects were sorely needed. During the last 29 years, there were some nice projects that were completed on a very frugal, payas-you-go basis. Recently, the City of Pompano Beach was at a point where it had gotten so far behind that we needed an influx of capital to get a number of badly needed capital improvement projects accomplished within seven short years, which was our projected timeline. We’re looking forward to going through the formal process of selling those bonds to get these projects underway, which will further the opportunities for economic development in Pompano Beach, as well as improve the overall appearance of the city. We want to inspire current property owners to follow suit and take care of their properties to make the city as appealing as possible to individuals who would like to come here and start a business. Pompano Beach is a very smart investment because entrepreneurs will be able to come here and set up shop for much less than in other major cities nearby. With all the current activity here, it’s great time to make an investment that will have a higher rate of return to support a business. Property values here have lagged behind most of the cities in the area. Developers are savvy enough to pick up on that and make considerable investments. Here in Pompano Beach, business owners will be a lot happier and a lot wealthier. We’re going to be very busy in the next few years implementing those projects from the general obligation fund. Our greatest challenge is going to be keeping up with the demand for our services and projects as we move forward.
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( ) have attracted large companies to headquarter in Pompano Beach, which is centrally located between Miami and West Palm Beach and has easy access to I-95 and the Florida Turnpike. Other companies with a presence in the city include FedEx, Gold Coast Beverage Distributors and Stimpson Manufacturing. In fact, the Pompano Beach industrial market totaled about 22 million square feet as of Q4 2017, which makes up an impressive 25 percent of the county’s industrial offerings. As Chris Clemens, economic development director of the City of Pompano Beach, told Invest:, “We annexed the Pompano Highlands neighborhood from Broward County and transferred the land use and zoning, which allowed for further development of the sites. Some of those tracks were larger industrial parcels and have been developed in the last few years. Some had older industrial facilities that will make way for more modern designs.” More space has brought more competition. The vacancy rate in Pompano Beach’s industrial sector dropped to 2.1 percent in Q4 2017, compared with the county’s 2.9 percent. With e-commerce sales growing five times faster than traditional retail sales nationwide, Pompano Beach’s industrial space will continue to be an asset for the city in years to come. While the diminishing land available for industrial development remains a concern, Pompano Beach has several parcels that are being redeveloped already to provide more efficient space. Innovation District Another exciting development for Pompano Beach is its planned Innovation District. The 60-acre area in the middle of Pompano Beach is the largest area of underdeveloped or vacant properties in Broward County and presents a unique opportunity to the city. The land is well positioned to attract hightech companies and their employees. As of Q4 2017, Pompano Beach had 2 percent of the county’s total office space and no class A offerings. By energizing the Innovation District, the city plans to attract companies that will be able to take advantage of the nearby plentiful industrial space. Horacio Danovich, capital improvement project (CIP) manager for the City of Pompano, told Invest:, “We are working hard to move the Innovation District project forward. This $750 million project may be the largest endeavor Pompano Beach will ever undertake. It has the capacity for over 1,000,000 square feet of office and retail, as well as two hotels with 420 rooms combined. We anticipate that the project will generate 4,000 jobs. The location is part of the project’s appeal.
CITY OF POMPANO BEACH OVERVIEW
Andy Fox Director of Operations – BRG Concepts
I didn’t come to Pompano often before we started work on Beach House, so I wasn’t aware of all the activity going on. We came to check out the location and saw the park, the pier renovation and families enjoying the area. We could see the revitalization happening, which made us very excited about the property. We couldn’t sign the deal fast enough. The City of Pompano Beach is really investing in the area, and we’re happy to be a part of the transformation.
It is the only one in the county right off I-95 with a central location that offers waterfront property on almost every side.” The city is going to attract class A office space, as well as more residential options to the area, creating a newly energized downtown. Scenic waterways, navigable by kayaks or paddle boards, will be used for drainage and will add to the attraction of the district. With more businesses comes more development, and the city’s infrastructure will receive a boost thanks to the recently passed general obligation bond, which will pour $180 million into improvement projects throughout the city. The bond will fund safety, infrastructure and recreation projects, including the renovation and construction of fire stations; the improvement of streets, sidewalks and drainage systems; the replacement of the city’s pier; and the construction of new athletic facilities. The measure was passed in March 2018 with about 70 percent approval, which demonstrates the community’s willingness to invest in their city.
keyless locks and sophisticated security systems. These high-tech units will appeal to the employees of the tech companies that Pompano Beach is looking to attract to its Innovation District. The building is slated to open in Q1 2019. Envy apartments, a development by Invesca, broke ground in Q4 2017 in the Koi master-planned community. The luxury apartment complex will feature a pet spa and outdoor movie theater and is slated to be completed in Q2 2019. Atlantico, a modern amenity-heavy apartment complex with 210 units opened its doors in July 2018, adding to the city’s residential offerings. Broadstone Oceanside, another multifamily development, is projected to be completed in 2019 and will offer residents access to the Intercoastal Waterway that the property fronts. The project’s developer is Merrimac Ventures, a firm famous for projects in South Florida like Miami Worldcenter. As of the end of July 2018, 17 projects were in the permitting stage alone throughout the city, with well-known developers eager to get a piece of Pompano Beach.
At the end of July 2018, 17 projects were in the permitting stage alone throughout Pompano Beach.
Prime real estate Real estate projects are easily found in Pompano Beach. On the hospitality side, the beach area is getting a brand-new hotel, further sparking tourist interest in the region. The Hilton will have 150 units, including suites and standard rooms. The hotel is projected to break ground by the end of 2018. In Q2 2018, the Avery Pompano Beach apartment tower topped off. The eight-story project will house 144 high-tech units, including smart home technology,
Innovative infrastructure The general obligation bond that passed in March 2018 will energize the city’s infrastructure and help to make it an even more beautiful and lively place. The first bonds were sold in the fall of 2018, allowing the city to design all the projects at once and begin construction on phase-one projects. The city estimates phase-one projects, including www.capitalanalyticsassociates.com
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CITY OF POMPANO BEACH OVERVIEW
Pompano Beach is focused on economic growth and redevelopment without losing its charming hometown feel, as evidenced by its openair farmers’ markets and other community events.
the construction of a new senior center and the renovation of Mitchell Moore and North Pompano parks, will be completed by 2021, and the remaining projects will be finished by 2024. Private industry is taking notice of the city’s improvement efforts. Alan Goldberg, CEO of Diversified Companies, told Invest:, “Pompano Beach is seeing a lot of growth. The elected officials have been very aggressive about new development and redevelopment in the city. The two community redevelopment agencies (CRAs) have also been very effective at rejuvenating Pompano. They’re doing some really good infrastructure projects with the bond money that came through earlier this year. The government of Pompano Beach is working hard to improve the quality of the city.” Replacing the city’s pier is also covered by the general obligation bond, but construction is already well underway. The project hit its halfway mark in July 2018 and is expected to be complete in March 2019. This project is the latest effort to attract more visitors to the city’s beach. New development and the opening of the Beach House restaurant brought in 50 percent higher parking revenues in March and April 2018 than in the previous year. Pompano Beach also has an ambitious Smart City plan, which involves the creation of a centralized network to 68 | Invest: Greater Fort Lauderdale 2019
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bring multiple services together in one process. Realtime emergency or maintenance information, access to information about city services and parking information and payment would all come together in one mobile app, and kiosks would be installed in high-traffic areas to provide this information to visitors or to those without phones. Along with the spread of information, this technology could also help with traffic congestion by connecting to traffic signals and modifying stop times based on the current traffic flow. It could also be a means of communication between taxi and bus drivers and their riders, with updated pickup times and traffic information available. As of August 2018, the city is working with FPL and other partners to make this smart integration a reality. If it succeeds, Pompano Beach could be the example that other cities in South Florida — and the nation — follow as the integration of technology continues to shape development. Transportation hub Pompano Beach is the home base of the South Florida Regional Transportation Authority (SFRTA), which runs the Tri-Rail system that connects South Florida. As Jack Stephens, executive director of the South Florida Regional Transportation Authority, told Invest:, “Pompano Beach is just about halfway between
POMPANO BEACH OVERVIEW
Shipwreck Park Pompano Beach is a popular offshore diving destination and artificial reef designed to encourage sea life and diving enthusiasts to explore scuttled ships like Okinawa and Lady Luck.
the two ends of South Florida. It’s an hour either way basically, which makes it very convenient for people to access us here. I think the City of Pompano Beach really appreciates the fact that we have invested here and anchored this part of the city in a positive manner. I think that worked well for all of us.” Easily reached via I-95 and the Florida Turnpike, Pompano Beach offers the SFRTA, as well as city residents, an accessible and central area. The Pompano Beach Airpark is located to the east of the city, while the Fort Lauderdale Executive Airport is blocks south of Pompano Beach’s southwest corner, offering multiple opportunities for private chartered travel. Fort
Lauderdale-Hollywood International Airport, one of the fastest-growing airports in the nation, is only 15 miles south of the center of the city. The Pompano Beach Airpark, perhaps best known in the South Florida area for being the home of the Goodyear blimp Spirit of Innovation, sits on 650 acres and offers chartered flights, aviation maintenance service, storage for aircraft and flight instruction, adding to the multibillion-dollar aviation industry throughout Broward County. Daniel Smith, airship PR specialist with the Goodyear Tire & Rubber Company, told Invest:, “We talk about being based in Pompano Beach with media from around the U.S. On the older
Rob Wyre Chairman – Shipwreck Park Pompano Beach
Shipwreck Park was the brainchild of city leaders many years ago. The purpose of the park is to increase Pompano Beach’s prominence as a destination. We got worldwide attention at the beginning of this project with the sinking of the Newtown Creek, which has been hosting between 35,000 and 50,000 divers a year since it was sunk. The sea life that has proliferated has been amazing. As the years go by, the sea life taking root there will grow stronger and stronger.
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CITY OF POMPANO BEACH OVERVIEW
Tim Hernandez Principal New Urban Communities Principal Pompano Pier Associates
blimps, ‘Pompano Beach’ is painted on the side. On the other hand, the signage for the Pompano Beach Airpark includes the blimp. The city recognizes the strength of our partnership. We bring our nationwide attention back here to our local community.” Tourist destination Pompano Beach has invested resources into making the city more friendly to visitors. The CRA spent $15 million on redevelopment projects, including the construction of an iconic parking garage with illuminated sails. The city also invested in its first visitor center for tourists, and more beachside retail space development is underway. The repaving and burying of utility cables on Briney Avenue along the beach will make the region more pleasing to locals and tourists alike, and all this activity spawned two world-class restaurants right on the beach. With investment from the city comes investment from the private sector, and Pompano Beach is no exception. Some old favorites in Pompano Beach are being given facelifts by new owners. Pompano Park opened its doors in the 1960s and has been the winter home of harness racing for years. The original track was superseded by a new facility built about 10 years ago. The casino and track were bought in 2016 by Eldorado Resorts, Inc., and the company has big plans for the property. The original stadium is being torn down to make way for a 223-acre mixed-use entertainment complex, including a hotel
Piers across the country are big centers of activity, and the Pompano Pier is no exception. People love to walk out over the ocean and look back at the city and out over the water. We’re making big changes to that area to make it more accessible. We leased all the land from A1A to the beach from the city for the next 50 years. We created access that will connect the pier and the Intracoastal. I don’t know anywhere else in South Florida where you have anything like that. We’re also environmentalists. We look for the best, most efficient and smartest ways to redevelop underutilized areas and take advantage of the existing infrastructure. On this project, we were of course working on the beach, which brought its own challenges. We have a revegetated dune, and our lighting is all turtle friendly. The project is already adding value to the community. At the halfway mark of construction, there was a 16 percent increase in value on the surrounding 30- to 40-year-old condos. Before, residents had nowhere to go and nothing to do after dark. Now we’re going to have a hotel and multiple restaurant and retail options. People are seeing the value of this particular location. Instead of getting in their cars to drive to Federal Highway, Lauderdaleby-the-Sea or Deerfield, they can just stay here, which encourages pride in the community. Pompano Beach is embracing this new direction due to its leadership; we cannot say enough positive things about Mayor Fisher, the other city commissioners and city staff. The mayor has lived in Pompano Beach his entire life. He is so effective at calmly guiding the city through issues that could be controversial but amazingly never are. We opened our doors in 1998 in Delray Beach, when the city was in its redevelopment infancy. The reason Delray developed the way it did was because there was a political force with everybody pulling in the same direction. The same thing is happening here in Pompano. Everyone is pulling together toward a shared vision. The government and industry here are staying focused, and as a result of that, Pompano is seeing, and will continue to see, the benefit. www.capitalanalyticsassociates.com
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and retail and entertainment venues. The new project could bring thousands of new jobs into Pompano Beach, stimulating its already growing economy. Another local favorite that will receive some attention is the Festival Marketplace. The market, located in the northwest corner of the city, has been providing Pompano Beach residents and visitors with an experiential retail option since 1991 and was purchased in April 2018 by local real estate company IMC Equity. The facility currently houses over 250 stores offering brand-name goods in an open-air market setting. The new owners plan to bring in more dining options, with the addition of several outparcel restaurants and an open-air farmers’ market. Plans for an apartment building and gas station are in the works as well. This new development will make the mall even more attractive to guests and residents. In the summer of 2017, the Okinawa, a 107-foot tugboat, was sunk alongside the Lady Luck as part of Shipwreck Park, an offshore diving destination and artificial reef to encourage sea life and diving enthusiasts to explore the scuttled ships. The Okinawa is proving even more popular than its larger counterpart, as it rests only 40 to 75 feet below the surface (Lady Luck is 100 feet down) so is more accessible to less experienced divers. The city is open to expanding the project and thereby attracting more tourists to Pompano Beach’s waterfront. It is hard to talk about Pompano Beach without mentioning the beach itself. Pompano has three miles of shoreline, and the public beach has lifeguards present every day, making it a safe choice for families. Local businesses also have kayaks and jet skis available for rent. From dinner cruises to fishing, Pompano Beach provides plenty of aquatic options. A new axe-throwing bar, opening in August 2018; the city’s new cultural center, which opened in the spring of 2017; and a new $11 million youth sports complex, to be completed with the other phase-two projects of the city’s general obligation bond, ensure that residents and visitors to Pompano Beach have plenty to do off the water as well.
community. Overcoming this image will help the city attract more South Floridians to explore the city and encourage others to invest and reside there. Luckily Pompano Beach is already getting the reputation as the place to move to and invest in as local businesses and leaders are taking note of the city’s redevelopment and Innovation District plans. With growth comes grumbling, and Pompano Beach is no exception. Increased traffic and disruptions caused by construction might irk some, but the investment in the city will improve the quality of life for residents and businesses alike. The bond projects have a timetable set up to allow construction processes to begin and end quickly, helping to mitigate frustration. Homelessness is an issue throughout Broward County. The number of homeless people in the county jumped by 6 percent from 2016 to 2017. While Pompano Beach has its share of the homeless population, it also has resources available to assist them. The Broward Outreach Center Pompano Beach is a 200-bed facility with an eight-week program to help put homeless individuals back on their feet. Pompano Beach has its share of challenges but does not shy away from them. City leaders are actively working towards smart solutions.
Pompano has three miles of shoreline, and the public beach has lifeguards present every day, making it a safe choice for families.
Growing pains To many South Florida natives, Pompano Beach is still considered a sleepy agricultural and retirement
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Thriving future Pompano Beach is a growing city with a lot to offer businesses and residents. Convenient transportation options are available to visitors and residents, and the area is expanding its entertainment options quickly, with both oceanside and dry venues. Private real estate developers are taking note and investing in the city. The convenient location and real estate for development mark this city as one with great potential, but the passage of the general obligation bond, a thriving industrial real estate sector and invigoration of the downtown and beachside areas set Pompano Beach apart as a city looking to secure its future in crowded Broward County. Capital Analytics would like to thank the City of Pompano Beach for its contribution in compiling this chapter. To learn more, visit their website: pompanobeachfl.gov.
Aviation & Transportation: The hotly contested debate over transportation continues in Broward and the state of Florida. However, with these challenges come great opportunities for innovation. Much-needed improvements are being implemented on the county’s main arteries, but Broward officials are still looking for solutions and alternatives to the Wave Streetcar project. With the Fort Lauderdale-Hollywood Airport as the crown jewel of the aviation industry, increasing public support is flowing in to accommodate the region’s continued growth.
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Aviation & Transportation in numbers: Economy in numbers: Fort Lauderdale – Hollywood International Airport monthly passenger traffic (2017-July 2018): 2017 JAN
2,800,000
FEB
2,610,000
MAR
3,140,000
APR
2,950,000
MAY
2,630,000
JUN
2,680,000
JUL
2,940,000 2,799,165
AUG 1,782,393
SEP OCT
2,395,526
NOV
2,736,896 3,000,000
DEC 0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000
3,500,000
2018 3,030,577
JAN
2,854,414
FEB
3,498,784
MAR 3,100,652
APR MAY
3,011,356
JUN
3,011,762 3,166,922
JUL 0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000
3,500,000
Source: Broward.org
Broward County Transit total monthly boardings (March 2018): March 2018
March 2017
% change
FY18 YTD
FY17 YTD
2,269,579
2,472,607
-8.2%
13,125,454
13,922,746
-5.7%
16,919
18,286
-7.5%
95,223
101,694
-6.4%
Breeze service: directly operated
153,432
173,371
-11.5%
888,746
955,999
-7.0%
Express service: directly operated
52,362
54,441
-3.8%
294,242
286,398
2.7%
2,492,292
2,718,705
-8.3%
14,403,665
15,266,836
-5.7%
195,828
218,673
-10.4%
1,136,184
1,172,087
-3.1%
74,350
76,410
-2.7%
432,302
398,101
8.6%
2,762,470
3,013,788
-8.3%
15,972,151
16,837,024
-5.0%
Travel mode
% change
Fixed route bus Regular service: directly operated Regular service: purchased transportation
Subtotal fixed route Community bus Paratransit System total Source: Broward.org
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AVIATION & TRANSPORTATION OVERVIEW
2,490,000
Building connectivity: With a growing population and booming development, improving transportation infrastructure is a hot topic in Broward County Transportation in Broward County is a hot topic, as congestion on roads continues to grow while options like Brightline come online for Broward’s residents to enjoy. With the rejection of the Wave Streetcar project, residents and leaders alike are looking for the next step in Broward’s public transportation program. Both Florida Department of Transportation (FDOT) and local projects continue to improve the county’s major roadways. With the Fort LauderdaleHollywood International Airport at the center of the county’s expanding aviation industry, that sector is seeing increasing support from the county and municipalities as a target industry for the region’s continued growth. Aviation and transportation are of high importance to both the residents and visitors of Broward County. Job growth With over 1.9 million permanent residents and over 12 million visitors a year, Broward’s transportation system is vitally important to the lives of its residents as well as the tourism industry. Transportation jobs employ over 50,000 residents of the county, and that number is projected to increase by 9.8
percent between 2014 and 2022. Broward’s aviation and aerospace sectors alone support almost 11,000 jobs, and the need is growing. As of Q2 2018, transportation, trade and utilities jobs were the fourth-fastest-growing job sector in the county — behind construction, business services and finance — adding 1,000 jobs in May alone. FLLying high Nationwide, demand for air travel continues to grow. From 2002 to 2018, the load factor — or percentage of seats sold — increased from 67.9 percent to 86.1 percent, while domestic flight numbers increased slightly from 8.1 to 8.2 million over the same amount of time. While demand is up, so are operating costs. The price of jet fuel has jumped 50 percent since 2017, prompting Delta and American Airlines to decrease their projected profits for the year in the spring of 2018. This could increase the cost of air travel starting in the fall of 2018. The Fort Lauderdale-Hollywood International Airport (FLL) was named the fastest-growing North American hub by air travel intelligence company OAG in June 2018. Between May 2017 and April 2018, FLL grew by 11 ( ) www.capitalanalyticsassociates.com
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AVIATION & TRANSPORTATION INTERVIEW
Handling growth How Fort Lauderdale-Hollywood International Airport is innovating to accomodate growing passenger numbers while maintaining its focus on customer service and safety
Mark Gale CEO/Director of Aviation – Fort LauderdaleHollywood International Airport facilities. While we want to add gates to increase our flight capacity, we must first address other areas of the airport that are struggling. As problems go, these are great ones for an airport director to have.
What challenges does the growth of Fort Lauderdale-Hollywood International Airport (FLL) pose? In 2017, we were the fastest-growing large-hub airport in the U.S. From 2013 through 2017, we’ve grown by 9 million passengers annually. That rate of growth is absolutely phenomenal. This is, of course, a great thing for Broward County, but at the same time it creates some issues. Almost all of the airlines we have here want to continue to grow, which is putting pressure on our facilities. We are beginning to run out of space. In the short term, we are rearranging things to allow our stakeholders to expand their services here. Looking forward, we are investing billions of dollars into our infrastructure and are laser-focused on the future of FLL. One of our key areas is the landside portion of the airport, which includes our roadways, parking garages and rental car 76 | Invest: Greater Fort Lauderdale 2019
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How is the airport working to improve its security? We’re changing our procedures so that if you work at this airport, no matter what your position, you will go through an outlined training program that will teach you about airport emergencies, including active shooter incidents, aircraft problems, medical emergencies, fuel spills, fires, bomb threats and more. We are also looking to teach every employee some basic first aid. We are not letting an opportunity slip by to prepare every single airport employee for any situation. Additionally, all our livelihoods depend on providing great customer service. Therefore, our training program will also include a module on the “guest experience.” Everybody plays a role in making sure that we provide the best customer experience, and that experience includes the safety of those who travel with us. How can FLL improve its connectivity to the region? If you take a look at the four large-hub airports in the state of Florida — us, Miami, Tampa and Orlando — three out of the four make use of automated people mover systems, and some have done so for decades. It’s time for us to join the club. Once we have our system, we will eliminate crowded shuttle buses. We also plan to construct a new intermodal center that will be situated off the east end of the airport and will connect to rail and other transit. We are also considering an automated system that would connect the airport and Port Everglades, which would facilitate connections for cruise passengers. All of this will be a major undertaking and will take years to accomplish.
AVIATION & TRANSPORTATION OVERVIEW
( ) percent in terms of passenger traffic. As Samuel Robbin, president and CEO of National Jets Inc., told Invest:, “The strength of the airport is key to the growth of Fort Lauderdale. In addition to being one of the fastest-growing airports in the country, FLL is also a fast-growing airport for corporate travel. FLL is very well run, and flights here provide good revenues for our county.” JetBlue, Southwest and Spirit make up about twothirds of FLL’s flights, and lowcost carriers spurred much of the airport’s flight growth. Southwest alone added 32 percent to its traffic over that same time span. Spirit is adding nonstop service to Asheville in September 2018, and Canadian carrier Swoop is providing service to Hamilton, Ontario, the following month. JetBlue added flights to Caribbean destinations, including Santiago, Dominican Republic and Grand Cayman, in 2018. While many travelers are coming to the area for tourism, business travelers are becoming more and more common. TravelBank ranked FLL the 18th best airport for business travelers in the nation in June 2018. Factors considered included on-time arrivals, parking prices and average nearby hotel costs. FLL’s average hotel was $190.33 a night, more than $100 less than the average price across the airports studied. All of this growth is putting strain on the airport’s existing infrastructure, so renovations are underway to accommodate the increased traffic. The airport is in the midst of a $3.2 billion renovation that has added gates, parking and a second runway. A new baggage
claim for international flyers opened in February 2018. Plans also include internally connected terminals and a people-mover connecting to a future transportation center. Choices for flights will be limited from June to October 2019 as the airport’s north runway closes for renovations. FLL leadership predicts that the number of flights will decrease by 20 to 25 percent during that time. The affected flights will be domestic and will result in an estimated loss of 1 million passengers for the year. (For information on the Pompano Beach Airpark, see pages 70-71.)
TravelBank ranked FLL the 18th best airport for business travelers in the nation in June 2018.
Aviation industry Broward’s aviation industry is a multibillion-dollar sector and one of the leading industries in the county. Airlines, engine manufacturers, maintenance and repair companies have homes throughout Broward County, including Banyan Air; GA Telesis; Sheltair; Turbine Controls, Inc.; and Spirit Airways. And the industry is growing: jobs in that sector have increased by 20.8 percent over the last five years. A growing need for pilots is spurring innovation and partnerships across the industry. “Due to the shortage of pilots, airlines are getting creative in bringing more people into the industry,” Kasey King, school director of American Flyers told Invest:. “We have a new partnership with American Airlines, and our first class finished up its first phase in October. These individuals are getting financial help to acquire their certifications and are on a fast track to careers at American Airlines.” The history of aviation in the region goes back decades. In late 2017, Broward College celebrated the 50th
Steven Rocco Airport Director – Pompano Beach Airpark The airline industry is growing. More people are flying than ever before. In past years, there was an age limit of 60 for commercial airline pilots’ mandatory retirement. A few years ago, the FAA realized it needed to raise the threshold to 65 because all of its pilots were starting to approach that age. We need to fill those pilot jobs, but it takes between three and five years to turn an absolute beginner into a commercial pilot.
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AVIATION & TRANSPORTATION OVERVIEW
Jason Annunziata Director – JetBlue Airways Fort Lauderdale is one of JetBlue’s most successful stories when it comes to growth. I think this speaks to the airport director’s guidance and Broward County’s focus on cost containment. Some of our customers from the Northeast are moving here and flying home to visit, which gives us great confidence that we will continue to see growth in South Florida — so much so that we have announced that our new subsidiary, JetBlue Travel Products, will be headquartered here.
anniversary of its aviation program, which was renamed the Emil Buehler Aviation Institute. The program offers associate degrees in aviation administration, pilot technology and aviation maintenance, as well as multiple certificate programs. Through the institute, Broward College supplies the growing need for aviation professionals in South Florida. In the summer of 2018, Sheltair Aviation broke ground on a new operations center and hangar at the
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Fort Lauderdale Executive Airport. The project will be the home of Banyan Air Service’s fixed-base operator (FBO) operations and will be completed in late 2019. The industry is an important one in the region. Rob Ceravolo, CEO and founder of Tropic Ocean Airways, told Invest:, “The aviation industry here is very strong and helped drive our recovery after the recession. South Florida is a gateway, so it’s a no-brainer for local government to support the industry here in the county.
AVIATION & TRANSPORTATION OVERVIEW
More and more companies are moving here because of our easy access to international destinations, and aviation is a big part of that accessibility.” Waving goodbye On May 8, 2018, the Broward County Commission voted to terminate the Wave Streetcar project, following the same decision by the City of Fort Lauderdale’s commission a few days earlier. The project, which had been under development for over 14 years and had over $130 million in federal and state grants, lost popularity due to its increasing cost and the fact that its fixed route would have been in a regular traffic lane. The lowest bid for the project was over the $142.5 million threshold (125 percent of the original estimate), which allowed the project to be pulled. The decision to end the project might cause problems for the region when it seeks federal and state funding in the future. The proposed 2.8-mile route through downtown Fort Lauderdale had spurred a good amount of development. Two-thirds of the high-rises launched in downtown Fort Lauderdale since 2012 are within two blocks of the route. While disappointed, developers did not seem overly concerned with the possible effect of the cancellation on their properties. From trains to buses Despite the Wave’s defeat, existing options serve Broward’s residents. Tri-Rail, the region’s commuter train, is projected to be providing service to downtown Miami in Q3 2019, further connecting the region. The Downtown Miami link route would use nine miles of existing track to connect to Miami Central Station, the Miami home of Brightline. Tri-Rail serves many travelers moving north to south, but going east to west is getting easier, too. In Q3 2018, Broward Breeze bus service between Sawgrass Mill and Fort Lauderdale, with limited stops, will begin, offering west Broward residents more options in their daily commute. With light rail’s possible drawbacks at the forefront of Broward transportation authorities’ minds, this bus route could mark the beginning of a greater role for buses in Broward’s long-term plans. In June 2018, the county commission voted six to one to put a referendum before Broward County voters in November. The legislation would increase sales tax in the county from 6 to 7 percent for 30 years, generating an estimated $16 billion for transportation infrastructure and services. The plan includes a light rail line along Broward Boulevard and a bus system connecting to every municipality
Gregory Stuart Executive Director Broward Metropolitan Planning Organization
The county is proposing a penny sales tax to better enhance and expand our transportation system. While the Wave and light rail did not become a part of our transportation landscape, we have continued to work hard to find ways to meet the ever-expanding needs of Broward. In fact, we’re investing hundreds of millions of dollars in intelligent transportation systems. Our first application of that is going to be in downtown Fort Lauderdale and moving west. We’re already starting to see better traffic flow during special events and crisis situations. On top of all that, and a really cool component, is that the infrastructure we’re starting to put in here allows for your vehicle to communicate with the traffic lights. It will be able to tell you how long it will be before the light changes from red to green. Down the road, it will communicate with the vehicle’s engine so that while you’re waiting for the light to change, your car won’t put as much carbon monoxide into the air. This is the stuff we’re working on for the next five to seven years. We’re trying to be proactive, not reactive. What’s happening in transportation right now is exciting because it’s going to allow for connected vehicles, connected buses and eventually autonomous vehicles. It’s the “Uberization” of things. We’re going to start seeing better ride-share programs, and that’s going to change the way we fundamentally think about traffic flow in our communities. Everyone wants us to do something about the traffic, but we’re pretty much at build-out, so everything is going to have to be about redevelopment here. We’re looking at the 2045 date in order to stay ahead of things, but the planning itself is really the first five years of funding, representing $5.8 billion. The second five years will probably equal that amount, if not more. We need to increase capacity and flow to handle the growth of between 2.3 and 2.8 million people that we’re anticipating here in Broward. The big picture of where we’re headed by 2045, other than on the autonomous vehicle side, is whether we are going to make the right capital and roadway improvements to prepare us for that future. www.capitalanalyticsassociates.com
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in the county, as well as improvements to roads and bike lanes and the implementation of more smart traffic technology. In 2016, a similar 0.5 percent hike was narrowly approved by county voters but was not implemented, as it was tied to another 0.5 percent tax increase for other infrastructure projects that did not receive enough support on voting day. While many residents are aware of the increasing traffic, at the time of print it was still uncertain whether they would choose to shoulder the cost of improvements and alternatives to driving on congested roads. On the road While different transportation options are becoming more common, driving is still a staple in many Broward residents’ lives. FDOT has multiple projects throughout Broward to improve driving conditions, including adding express lanes on I-95 and improvements on A1A and Route 1, but cities are also taking a hand in improving road conditions for their residents. Pembroke Pines is working with the county to widen Pines Boulevard from four to six lanes, and Southwest Ranches is looking to widen a section of Griffin Road from two to four lanes. Fort Lauderdale, recovering from the Wave, is considering changing two major thoroughfares — Andrews Avenue and Third Avenue — into one-way streets with a dedicated bus lane to reduce congestion while offering a flexible public transportation option. The American Dream mega-mall, proposed in northwest Miami-Dade County, was approved by the Miami-Dade Commission in May 2018 but hit a snag in August when the South Florida Regional Planning Council voted five to four against the planned $4
billion project due to traffic concerns. The developer will be responsible for $210 million in transportation infrastructure costs in Broward County alone, as the new mall would put serious strain on I-75 and require the construction of new exits. The project is projected to open on Black Friday 2023. Ridesharing remains popular among South Florida residents. According to data from Empower, the average Lyft customer in Fort Lauderdale spends $85 a month on rides, while Uber users come in at $46 monthly. A study by Uber, released in July 2018, showed a $134 million impact on the state of Florida. The study also showed that 25 percent of Florida users utilize the service for their daily commutes, demonstrating that ridesharing is becoming a viable daily option for many in Florida and one that, for certain individuals, might replace car ownership. While many tout ridesharing as a way to cut down on drunk driving, it could be compounding another issue: distracted driving. Drivers for Lyft and Uber use their phones while driving to navigate, as well as to accept or decline riders. Accidents have increased by 11 percent between 2013 and 2016 in the state of Florida, and those caused by careless drivers have quadrupled during that same timeframe. Bright times ahead Brightline, South Florida’s new privately owned railway, opened its Fort Lauderdale-Miami route in May 2018. This joined the Fort Lauderdale-West Palm Beach route, which began service in January 2018. Rides were added to the service in August, increasing the number of roundtrip rides a day from 11 to 16. Brightline projects that it will have 3 million ( )
Julie Leonard Interim Director – Fort Lauderdale Department of Transportation and Mobility We’re at a point in the history of our city where we have a unique opportunity to work together with Broward County and all of our regional partners in transportation to develop a comprehensive plan that will take us into the next generation. With continued growth and development, both in our downtown area and the city and county as a whole, it’s important that we keep in mind our vision for a walkable and connected transportation network that supports connectivity within our city, as well as between our city and other key destination points.
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AVIATION & TRANSPORTATION INTERVIEW
Sweet spot How Brightline is leading the way in connecting Florida’s attractions and communities, with a strong focus on tapping Fort Lauderdale’s destination potential
Patrick Goddard President & COO – Brightline How is Brightline contributing to the regionalization of South Florida? We’re seeing interest from attractions, dining venues, events and others in partnering with us to bring people in from Miami and West Palm Beach. These areas are effectively new markets for them, and many local businesses are looking to take advantage of that. Correspondingly, people who live in Fort Lauderdale now have options in these other two markets that they never would have considered before. It’s sparking a lot of new conversations, and that’s going to lead to economic growth and better integration of the communities at a lot of different levels. Our heaviest traffic is on the weekends for leisure trips, especially around meal times and for events. In August, we increased the scheduled trains to 16 round trips, which allows a rider to go for dinner in Miami and get home easily and without rushing. What are your top priorities for Fort Lauderdale? There’s so much potential that we see in the relationship of all three cities, but particularly with Broward. We created our own destination in Miami already, and in Palm Beach, riders land in City Place. The Related Group is working on projects up there. Broward has much more potential. We’re looking to improve the experience of arriving in Fort Lauderdale and then getting around the area from the station. Sun Trolley is synchronizing its service with our arrival times, which is a good step. Being right next to the bus terminal is obviously a plus, and we need to capitalize on that relationship as well. I think that the county and the city are trying to think about ways that we can work together to improve both the arrival experience and getting our passengers easily to Las Olas, the beach, Riverwalk and other areas or attractions. We, the county and the city own land there, so there’s potential that we would collaborate on a project near our station.
How will Brightline’s planned expansions to Orlando and Tampa increase connectivity within Florida? There are about 500 million trips between Central and South Florida yearly, which is easily over a million trips a day. Air travel is inconvenient in Florida in general and in the summertime particularly due to the many intense storms we get. What should have been a quick flight ends up taking hours. Plus, short flights are, on a per-mile basis, a lot more expensive for an airline. This makes it hard for both visitors and Florida residents to easily travel around the state. It’s our view that routes that are too short to fly and too long to drive are sweet spots for train travel. Although train travel is common in Europe and Asia, it never happened in the U.S. because we had such a great highway system. Now, due to population growth and resulting traffic congestion, rail is the future. www.capitalanalyticsassociates.com
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Tim Fish South Florida Managing Principal HDR
What is the greatest challenge facing Broward’s transportation network today? The progress that has been made throughout the county’s transit, aviation, port and maritime systems since the downturn in 2008 has been unbelievable. The challenge we see now is connecting all of the pieces. We need to make it all work together as one system that services the community. We have to solve this problem both for the people who live here and for the people who move here daily. Nobody wants to sit in traffic for 45 minutes or take multiple buses to get to their destinations. It’s a huge part of quality of life. I have no doubt that the drive and the expertise is here to solve it, but funding is forever going to be a limiting factor. Less money is coming from the federal side, so there’s more pressure locally than there has ever been. How would you describe the county’s aviation industry? We’ve never seen the aviation industry in Broward as strong as it is right now. The big airport expansion program is almost completed. FLL is modernizing facilities and updating aging infrastructure. The airlines are much more in the driver’s seat now than they’ve ever been in the past, and you see that at FLL. They’ve done a fantastic job of answering that call. The biggest challenge the airport will face now is the continued growth of demand. Keeping the passengers happy and moving them efficiently will be key in keeping traffic coming to FLL. General aviation is strong in Broward as well. Private planes are getting bigger, requiring larger and more modern facilities. There are many different operating entities in that space. The City of Pompano Beach runs the Pompano Beach Airpark, and the City of Fort Lauderdale runs the Fort Lauderdale Executive Airport. These groups do a really good job of coming together and working as an airport system. The airspace is so busy, and everybody is growing, but they’re growing together cohesively to make air travel easier. 82 | Invest: Greater Fort Lauderdale 2019
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Broward County is working to make its roadways safer for cars and pedestrians by implementing smart traffic management systems.
( ) passengers annually by 2020. Many are already taking advantage of the trips to skip traffic. From Miami to Fort Lauderdale is about a half hour, and from West Palm Beach to Miami is an hour. The tabletop seating and Wifi make it especially convenient for business travelers, but many use the service for leisure. In fact, the busiest ride times are on the weekends and at lunch or dinner time. Fort Lauderdale benefits from being at the center of the South Florida route, receiving traffic from Miami and Palm Beach daily. The Downtown Development Authority marked routes on the sidewalks from the Brightline station to Las Olas, Riverwalk and the Arts District to help pedestrians navigate the area. The station is also bringing development. Florida East Coast Industries, Brightline’s parent company, is looking to build a 14-story office and retail tower near the station, and significant redevelopment is occuring in the nearby Sistrunk neighborhood. The new system has not come without issues, however. Several people have been injured or killed by trains, and some residents have complained of the noise and delay in traffic as the trains cross roadways. In response, multiple cities have upgraded their infrastructure, with the help of state and federal funds, to allow crossings to be “quiet zones”
CONSTRUCTION ECONOMY OVERVIEW
Kasra Moshkani General Manager Uber
in which the conductor does not need to blow the train’s horn as it moves through. This should help to alleviate some of the disruption. Brightline’s next move is to connect to Orlando and eventually Tampa. Some residents in areas along the proposed route oppose the project and have filed multiple suits against the company. If all goes according to plan, the route would increase connectivity in the region and allow travelers to move from Miami to Orlando starting in 2021. In June 2018, Governor Scott announced that the state was taking bids for the connection from Orlando to Tampa as long as taxpayer money was not involved. With the support of the governor, Brightline could play a large role in making Florida less dependent on personal vehicles to travel within the state. Tech forward New technologies are changing the way residents move in Broward County. Traffic management systems, installed by FDOT in 2016, cover 70 miles of state roads in the county, monitor traffic conditions and ameliorate the timing of traffic signals to ease congestion. However, the systems have yet to be installed north of Oakland Park Boulevard or west of University Drive, leaving a large part of the county
How is consumer use of Uber evolving? We created a survey and received a lot of interesting data about how Uber is being utilized here in the area. We learned that in South Florida, 31 percent of riders who are using Uber do so for their daily commutes. These are people who are not only going out at night, not only using it for leisure, but they’re also using it to get to or from work. What we’ve seen over the lifecycle of Uber is that people start to use the app when they’re going out at night or when they’re going to the airport. Then they come to understand the benefit, and it becomes more ingrained in their daily lives. Seeing nearly a third of people taking it to and from work is pretty awesome. How is Uber innovating when it comes to partnering with local municipalities? We have a new product called Uber Movement, which is basically an interface that creates infographic displays of our data. Obviously, there are a lot of trips that take place on Uber platforms across all of our cities, so we’re harnessing the data we have about when and where those trips are going. With this product, we can help urban planners, for example, make informed decisions about development. Local leaders are working to come up with solutions to congestion and commute times, as well as investing in smart infrastructure. Uber Movement is a tool that is designed to leverage our data and make that available so that city leaders can make more informed decisions. We will be expanding the program to South Florida in 2019. How is Uber helping to mitigate drunk driving? We are committed to helping people make smart choices, and we do that by making an alternative to drunk driving available to them. What we’ve done over the last two years is work closely with local law enforcement agencies in order to raise awareness about Uber as an alternative to drinking and driving. www.capitalanalyticsassociates.com
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AVIATION & TRANSPORTATION OVERVIEW
Jenni Morejon President & CEO – Fort Lauderdale Downtown Development Authority As a downtown development agency, we were clearly disappointed that the Wave Streetcar didn’t move forward, but great cities don’t just stop evolving when there’s a setback. We’ve learned that 15 years from inception to full funding is far too long for any project, and we need to be more nimble and quick to implement mobility solutions. Improving transportation requires multiple options and complementary modes of transit, and we’ll continue to push for these investments in Downtown Fort Lauderdale.
without the benefits of this system. With no state roads in that area, the county will need to step in to implement this technology. While the technology will not be able to solve rush hour traffic, it does offer a smarter strategy for congestion on busy roads at non-peak times of the day. Other options include buses with traffic signal priority software. Stoplights would stay green and allow these buses to move through congested areas more quickly. This system would be used on the buses running on the proposed oneway loop in Fort Lauderdale. In June 2018, the Broward County Commission approved the purchase of five electric buses and their charging equipment, and 10 more could be approved soon. Broward will be the third community in the state to have electric buses, which will feature free Wifi and power outlets for the convenience of riders. While these buses will make up a small portion of Broward’s bus fleet at first, the plan is to eventually switch over to all electric, which is one step in a larger modernization effort. “As a community, we recognize new opportunities for moving large amounts of people more efficiently,” Robyn Chiarelli, executive director of Sun Trolley, told Invest:. “As a result we’ve started an ad hoc working group with some major stakeholders to start the discussion about new technologies. In partnership with city staff, we’re exploring alternative new technologies like micro transit and automated vehicles. I think we all recognize
that there are automated vehicle projects cropping up across the country and see potential here for those technologies.” Speaking of electric vehicles, personal EVs are becoming more common. A report by Bloomberg suggests that by 2040, over half of new car sales will be electric, and these cars will need somewhere to charge. Adding electric charging stations is a smart move for South Florida businesses, as drivers often use apps to find them. By installing a station, a business owner can drive traffic to or near his or her establishment. South Florida companies like Brickell Energy have invested in this technology and will continue to transform our parking garages one outlet at a time.
A report by Bloomberg suggests that by 2040, over half of new car sales will be electric.
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Looking ahead Despite challenges like the defeat of the Wave Streetcar project, Broward officials are pushing forward to provide options for residents and visitors alike. With one of the fastest-growing airports in the county at its heart, Broward County is working to improve its roadways while providing more options like Brightline, Sun Trolley, bus routes and more. With a rapidly increasing population, Greater Fort Lauderdale’s challenge is to provide more options while handling increased demand on existing infrastructure. All in all, the aviation and transportation sectors in Broward will continue to grow and play an important role in supporting the county’s thriving economy.
Infrastructure, Utilities & Environment: Broward County’s growing population has been an economic driver across the board. Understandably, it has also applied some pressure to utilities providers. The region’s public and private entities have had to find creative solutions in order to serve their clients while maintaining the environmental health of the county’s varied ecosystems and keeping energy sustainable in the long run.
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Powering lives: While aging infrastructure remains a challenge in Broward, its cities are working hard to support high-quality living into the future With a continually growing population (the county saw an increase of 10.7 percent from 2010 to 2017) and a limited amount of land, Broward County has a large need for utilities like electricity, water and sewer and internet connection. Serving an expanding number of residents while balancing the environmental health of the area is a challenge, but Broward’s public and private entities are working to provide thoughtful progress in the realms of sustainability and service. Broward’s aging infrastructure is also a problem, but cities are working to improve it in order to support the quality of life of their residents. In January 2018, the City of Fort Lauderdale approved a $200 million bond to repair areas of the city’s water-sewer system, a good first step towards more effective infrastructure in the region. Ecosystem Broward County is made up of two distinct sections: around 400 square miles of developable land with 30 different municipalities and over 700 square miles of conservation area. Those 700 square miles are an active part of the Everglades ecosystem, which is driven by Lake Okeechobee’s flood waters draining through the Everglades during the rainy season. 86 | Invest: Greater Fort Lauderdale 2019
Development has disrupted this system, compounding issues like flooding and the algal blooms in Lake Okeechobee, which occur in particularly hot and rainy years, including 2016 and 2018. In the summer of 2018, 90 percent of the lake’s surface was covered with the green slime for several weeks before the bloom wore itself out. Projects like the raising of the Tamiami Trail are helping to restore the natural flow and bring more fresh water into the Everglades, which is home to many threatened or endangered species, including the eastern indigo snake and the red-cockaded woodpecker. The wetlands welcome more than 1 million visitors yearly and are a pivotal part of Broward’s strong tourism economy. Everglades National Park is a large economic driver for the county and also supplies fresh drinking water to South Florida residents. Changing climate Since 1992, the oceans have been warming at rate nearly double that of the previous three decades, and sea levels are projected to rise around two feet by 2060. This presents significant challenges worldwide
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CONSTRUCTION ECONOMY OVERVIEW
but especially in South Florida and Broward County, which lies from three to seven feet above sea level. Higher tides and rougher storms, also linked to climate change, are posing a serious problem for Florida’s beaches. The state has spent over $100 million on adding sand to beaches statewide in the last three years, and a proposed $50 million project, focusing on the beaches of Hollywood, Hallandale Beach and Dania Beach, will kick off in 2021. While the tourism-based economy demands beaches, some criticize the plan and predict the sand will simply be swept away again, leaving the area with the same issue and less money. Dania Beach is calling for a more radical solution, adding a dune and a sea wall, as well as elevating the beach’s parking structure to prevent damage to vehicles. Dean Trantalis, the mayor of Fort Lauderdale, hears these concerns daily. “Many people are concerned about climate change and how Fort Lauderdale is responding to that,” he told Invest:. “Overall, one concern is about saltwater intrusion in our drinking water, as well as our treatment plants’ ability to accommodate the change in the aquifer that we will soon be experiencing. We also have to address flooding because the tides have definitely gotten worse, and we’re concerned about our ability to address the impact that flooding is going to have on us as a community.” In September 2017, when Hurricane Irma changed trajectory and migrated to the west coast of Florida, Broward residents let out a collective sigh of relief, although some damage was still done and many residents went without power. As of the Monday after the storm, 68 percent of Florida Power & Light Company (FPL) accounts in Broward County were still in the dark. Dunes, added in 2016, mitigated sand loss and flooding during Hurricane Irma and can be implemented in more areas to protect beaches and infrastructure. Tidal valves have also been installed around Fort Lauderdale, and they helped to control flooding during and after Hurricane Irma. Broward, along with Miami-Dade, Palm Beach and Monroe counties, is a member of the Southeast Florida Regional Compact on Climate Change, a regional group committed to sustainability and climate resilience. Each member of the compact is better positioned to make informed decisions with the pooled resources available through the compact. Overall, the county and municipalities are working hard to mitigate the risks of rising water and to prepare for more storms and flooding. As Alan Cohen, assistant county administrator for Broward County, told Invest:, “We’re focused on a
Lawrence DeRose Senior Vice President Louis Berger
How does transition housing fit into the affordable housing need in Broward? Transition housing doesn’t need to be set up to support long-term occupancy. What that means is that the units can be small and efficient so that a homeless or struggling family can move into these units and live there for a period of time until they are able to secure jobs and are back on their feet. To find a job, you need an address and the ability to take a shower and look presentable. Then they can move from transition housing to low-income housing. It’s a stepping stone in the direction of personal wellbeing. A lot of people who are homeless can’t go from homelessness to low-income housing. They need baby steps to get there. They probably decayed to homelessness in small steps, and they need to rise out of it in small steps. We have some major housing projects coming up in the downtown area for affordable and transition housing. What are the most pressing infrastructure needs facing the county? The business community and political community are all talking about transportation and its problems. The roads are more dense today than they’ve ever been, so transportation is number one. This will manifest itself in the penny sales tax that is coming up for vote later in the year. This time they got it right because the county should be the center of this program. The taxpayers all know that if you have too many centers, too much revenue will be devoted to running the centers instead of the program. Instead, you put the center for running the transportation program in one area, and now the overhead is consolidated so the penny sales tax will go towards buying a lot more construction. Broward County has been excellent at managing its finances and the public’s money. We have had very few crises because the commission has been excellent at running the finances of our community. www.capitalanalyticsassociates.com
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Jennifer Jurado Chief Resiliency Officer Broward County
Fundamentally, climate issues are too large for any one community to try to tackle on its own because the challenge is very resource-intensive in terms of expertise, knowledge and time. Bringing resources together from the four counties of the Southeast Florida Regional Climate Change Compact helped bolster all of our efforts. Miami-Dade had people with good expertise regarding transportation, Broward had people focused on water and energy and other communities had people who were experts on natural systems. To be able to freely tap into that knowledge has widened our resources significantly. By working regionally we were able to take advantage of agencies, funding and technical assistance that we couldn’t access individually. By working with us, these entities are affecting more than just one community, but an entire region, which makes it easier for them to justify their investment. In South Florida, we are so dependent on one another. Many people who work in Miami-Dade are living in Broward, and those who work in Broward might be living in Palm Beach. We share transportation systems, the reef track and our beaches. In light of that, we’ve decided on a strategy in which the different communities work together and are not compromising or detracting from the abilities of neighbors. Ideally investments that happen in one area are augmenting the efforts of another. Sustainability efforts are never going to be completed; this is going to have to be something that we continuously keep our eye on. These efforts provide an incredible opportunity for community beautification. We will need more water storage areas integrated into the community, which can be done in a very beautiful and unobtrusive way. The successes of southeast Florida will be the model statewide, as well as around the world. It really is a testing ground. By working together, we are able to share staff expertise, tap that external talent and speak with a greater volume by coming together. We’ve accelerated this process in a way that I think individual communities working in isolation just couldn’t. 88 | Invest: Greater Fort Lauderdale 2019
Florida Power & Light Company is the third-largest electric utility in the U.S. and serves an estimated 10 million residents in Florida.
multi-generational time frame from both a public and private sector perspective in terms of sustainability. If I was starting a new business here, would I feel comfortable doing so knowing what I know? The answer is yes because our projections, while not desirable, are manageable.” Fresh water Fresh drinking water is a precious commodity, especially for residents of a peninsula bounded by ocean. Broward’s 2017 water quality report, released in July 2018, showed low, acceptable levels of chemicals in the county’s water, but there are still concerns. Throughout the county, water infrastructure is aging, and this is providing a significant challenge. Saltwater intrusion has already advanced past the Fort LauderdaleHollywood International Airport and is threatening several wells. If wells are compromised, cities will need to look for other wells or commit to the costly process of desalinating water for drinking. Lake Okeechobee, which provides drinking water, as well as irrigation for Florida’s agriculture, was 90 percent covered in dangerous algae in July 2018. When the water rose too high, it was diverted through estuaries east and west, which spread the algae farther and impacted both the St. Lucie and the Caloosahatchee rivers, causing Governor Scott to declare a state of emergency in seven neighboring counties. To combat this, the White House approved an Everglades reservoir project that same
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INFRASTRUCTURE, UTILITIES & ENVIRONMENT OVERVIEW
Kristin Johnson Karp President & CEO Hotwire Communications
month, to be voted on by the Senate later in the year. This reservoir would allow 370,000 acre-feet of water to flow through the Everglades and reduce the built-up water from being diverted east and west. The City of Fort Lauderdale has spent over $100 million of its water-sewer fund on unrelated expenses since 2012, while an independent consultant reported that the city’s system might need $1.4 billion in the next 20 years. In July 2018, the Fort Lauderdale commission voted to phase out taking money from the sewer fund, decreasing its reliance on the fund by $5 million yearly, with a goal of reaching zero in four years. Pompano Beach created a system to reuse water for irrigation, thereby preserving its supply of drinking water. The city has successfully pushed back its saltwater intrusion line — the only one in the region to do so — by creating a western well field and has plans to expand its treatment plant. Affordable energy Energy and gasoline prices are slightly lower in South Florida than elsewhere in the U.S. As of July 2018, South Florida area gas cost an average of $2.832 a gallon, compared to $2.930 nationally. On the electricity side, each kilowatt cost 0.118 in South Florida and 0.139 nationwide. These lower prices help keep living in the region affordable. The largest news in energy was Hurricane Irma, which knocked out power to about 68 percent of FPL customers in Broward County. However, FPL customers
In October 2017, Hotwire Communications began to participate in the Netflix speed index, an independent ranking of all Internet Service Providers (ISPs) to show who delivers the highest-quality video at the fastest bits per second. Our company is consistently ranked number one against other incumbents, and we are very proud of this. The ranking is a testament to what our fiber optic network can do in the high-traffic, high-capacity environment. We are now living in an upload world, which is different from a few years ago when people just wanted to download content and go. Now consumers are sharing and streaming up content, so technology must advance to stay relevant. This kind of social sharing requires upload speeds to be just as ubiquitous and reliable as download speeds, and our network can do it. We are seeing a lot of doors open up for us because of this ability. Our growth closely follows the reurbanization of South Florida. As we expand our network alongside the region’s growing downtown areas, we’re engaging local governments to work with clients and officials on their visions of the future. More cities are moving toward a smart city concept, which is not a “one size fits all” scenario. Our solutions must meet the needs of the individual municipalities, which in turn will best serve the entire community. By deploying fiber optics exclusively, we can now move quickly on these emerging concepts and build new and meaningful relationships with local constituents. We want to work with governments and universities to expand the tech space in Fort Lauderdale while simultaneously offering a product that delivers an unparalleled experience. Fiber optics is the future of technology — able to be buried today and serve customers for generations to come. The infrastructure is there, and we can continue to build on it. Everything that you think possible is doable — that’s the beauty of what we do. This future-proof technology allows us to go in at the ground level, meet customers’ expectations of service today and exceed their wildest dreams of the possibilities of technology in the future, whether that’s five, 10 or 20 years from now. www.capitalanalyticsassociates.com
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Gerardo Garza Vice President Sales – Business Services, Atlantic Broadband
Just last year, we overtook Austin as the number one city for startups in the U.S. It’s a huge opportunity because that designation increases the pull of talent to the area, but it will require a lot of investment in infrastructure across the board. Our biggest issue is traffic. We need to be able to move people around effectively. We were always talking about the tourism and marine industries, but now we’re being taken over by small tech-based startups. It’s great to see the region investing in IT. now have something to smile about. As of March 2018, rates decreased by 2 to 4 percent due to the completion of a Hurricane Matthew restoration surcharge and the closure of a local coal plant. Following the tragic deaths of 12 residents at a Hollywood nursing home, Governor Scott signed laws requiring all nursing homes to have generators for backup power, but as of June 2018, only 24 percent of these facilities in South Florida were in compliance. More than 30 percent had filed for extensions, and 45 percent had not yet responded to the legislation. However, the law marks a step forward in protecting Florida’s vulnerable residents during extreme weather events. After the hurricane, FPL started a program to bury more of its power lines to avoid wind damage during future storms. Underground, the lines are protected by waterproof tubing, but if the tubing is compromised, repairing the infrastructure becomes much more
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difficult. Another hardening technique is to trim or remove trees close to power lines. Broward County passed regulations in May 2018 restricting the planting of new trees near powerlines. While these regulations apply only to residents of unincorporated areas, the model could catch on among the county’s municipalities. Also in May, NextEra Energy, the parent company of FPL, bought Florida City Gas and Gulf Power, solidifying its prominence in the region and gaining just under half a million new customers. The company is also looking to increase energy production in Broward. In March 2018, the company’s proposed $888 million power plant to replace the existing Dania Beach plant was approved by the Florida Public Service Commission. More permissions remain before construction can begin, but if all goes smoothly, operation could commence in June 2022. By replacing the existing power plant, emission rates would be cut by 95 percent for nitrogen oxide and 22 percent for
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INFRASTRUCTURE, UTILITIES & ENIVRONMENT OVERVIEW
Ron Bergeron Founder – Bergeron Land Development
There are a lot of projects dedicated to Everglades restoration. The strategy has been to form a consensus of prioritized projects that will stop the most irreversible damage first. Since the Everglades is in the emergency room, how do we keep it alive for the next 30 years? We’ve had great success on the quality of water entering the Everglades thanks to state and federal entities. We’ve built a one-mile bridge, completed about five years ago, on the Tamiami Trail and are currently working on a 2.6-mile bridge that should be completed next year. That will give us 3.6 miles of bridging to allow the natural sheet flow to resume. These actions will start to minimize the discharges out of our rivers to the Gulf and the Atlantic and the high-water events in the central Everglades that impact the environment. carbon dioxide. The new plant is projected to save FPL customers over $300 million. Sun power In 2017, 63 percent of energy nationwide was generated by fossil fuels, followed by nuclear power (20 percent) and renewable energy sources (17 percent). Solar power came in at just 1.3 percent but is growing in popularity, especially in sunny South Florida. In July 2018, FPL began installing creativelooking solar trees and canopies throughout the region to increase awareness and solar energy use. As of July 2018, about 1 percent of FPL’s energy was generated by solar. The company plans to increase that to 5 percent by 2023. In Broward, these projects can be found in neighborhood parks in Davie, Cooper City and Pembroke Pines, among other cities. In the last five years, solar carport costs have dropped by 50 percent, and the market for them is growing. In South Florida, carports provide shade to keep cars cool and produce clean electricity, and they can be outfitted with charging stations for electric vehicles. Advanced Roofing, a Fort Lauderdale-based company that specializes in solar carports, recently installed a carport at its office that provides enough power to run the entire office. Convenient technology like this makes increased use of renewable energy attractive to area businesses.
South Florida’s first solar plant will begin producing in 2019. In March 2018, FPL announced the locations of four new solar plants throughout Florida, including one in Miami-Dade County. The plant will have the capacity of 74.5 megawatts and the ability to power 15,000 homes. Due to high land cost, solar has been slow to emerge in South Florida, but this is a good first step towards more renewable energy production in the area. Waste management The waste management industry is expected to grow over $560 billion by 2020 globally as new and innovative technologies and techniques move onto the scene. In Broward, waste caught the attention of many cities in July 2018. Every city has its own system for waste, and recycling prices nearly doubled for many after their contracts with Sun Bergeron expired. Most municipalities signed new contracts, including Deerfield Beach, which had suspended its recycling program for six weeks due to high costs. Part of the issue lies with China. Once a major purchaser of U.S. recycling, the market is no longer accepting mixed paper or mixed plastic loads. This issue is raising costs nationwide. Broward’s very own landfill, Waste Management’s Monarch Hill, is not a favorite among its neighbors but did help significantly in the wake of Hurricane Irma. Workers transferred 1.5 million tons of trash from
The waste management industry is expected to grow over $560 billion by 2020 globally.
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INFRASTRUCTURE, UTILITIES & ENIVRONMENT OVERVIEW
storm damage to the landfill rather than transporting it to northern Florida, which would have slowed the cleanup process and clogged roadways. While landfills are not often touted as being environmentally friendly, the landfill’s gases give off enough energy to power 5,000 homes and its curves break up the monotonous topography of South Florida. Telecommunications Broward residents are getting used to the 1-gigabit service from Comcast, which was introduced to Broward and Miami-Dade counties early in 2017. Palm Beach County just received service from the company in April 2018, and other areas are still waiting for the higher speeds many Broward residents are currently taking advantage of. From 2015 to 2017, AT&T has invested over $1 billion and made over 1,400 network upgrades throughout South Florida. Broward is also home to multiple telecommunications companies, including Hotwire Communications, which serves customers throughout the northeast and southwest United States. Q Link Wireless, a telecommunications company based in Dania Beach, added 40 new local jobs after expanding their reach nationally early in 2018. In the wake of the Wave Streetcar’s defeat, many are wondering what the next step will be. A bus system has been proposed, which would benefit greatly from smart street technology. By cuing streetlights to allow these buses to pass through quickly, the bus system would become more appealing than driving a personal vehicle by cutting the time spent in traffic. Challenges Broward County faces multiple challenges, including aging infrastructure, limited space and susceptibility to issues from sea-level rise. Hurricane Irma provided
impetus to update infrastructure by highlighting the weaknesses and strengths of the area’s systems without doing too much permanent damage. The high cost of land is an obstacle for prospective water wells or solar farms. Broward’s low elevation makes it susceptible to saltwater intrusion and damage from flooding. Saltwater intrusion is already threatening some of Fort Lauderdale and Hallandale Beach’s wells, and more may need to be established farther inland to supply the area’s population. These challenges are not insurmountable. With funding from the city, county, state and federal levels (as well as private entities), Broward will successfully update infrastructure and combat the effects of sea-level rise. Sustainable future Overall, 2018 is a growth year for Broward County’s infrastructure industry. Hurricane Irma was a not-sogentle reminder that the area’s infrastructure needs to be updated, and multiple projects are currently in the works to prevent flooding and maintain electricity in emergency situations. Improvements and technological advancements will help to make Broward County a more sustainable, and therefore a less expensive, place to live. As Kevin McMinn, chief sales officer at Crius Energy, LLC, told Invest:, “Business people in Florida need to pay close attention to global warming and hurricane activity. It’s having a real impact, but I think it could be an economic opportunity for the next wave of infrastructure development in Florida to test and try technologies here that we could market to other areas in danger. This is technology that the whole world will need, and we could export it.” Broward County is well positioned to be the country’s expert on climate change and infrastructure solutions, further solidifying its place as a regional powerhouse.
Larry Baum Managing Partner – Stellar Communities
Our sustainable and environmentally friendly focus is part of our ethos, part of who we are. Right now, when we put in solar panels, increased insulation, hybrid water heaters and the best-rated AC systems, the home value does not go up when it is appraised, which doesn’t make sense. Homeowners and developers should be able to benefit from these green features. The government did away with many tax credits for developers, which takes away the financial incentive for developers to pursue more sustainable practices.
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Healthcare: Uncertainty over federal healthcare programs has amounted to increased spending and decreased coverage over the years. Nevertheless, Broward’s healthcare sector continues to expand and innovate with new technologies, high-tech partnerships and critical acclaim. The healthcare sector employs over 70,000 residents and fuels economic growth. Despite challenges with insurance, the region is making advancements in public health and wellness, leveraging its legacy institutions to attract new fields of medicine.
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Wellness matters: Despite uncertainty over the future of federal healthcare, Broward’s healthcare facilities continue to innovate and grow Broward County has 19 acute care hospitals offering care to the residents of the region. The healthcare industry provides direct employment for more than 70,000 residents in South Florida, making it a major economic engine. While there has been some turbulence in the industry in the last year — including the elimination of the Affordable Care Act (ACA)’s individual mandate and the indictment of several Broward Health leaders — the healthcare sector continues to grow and innovate. New technology, a high-tech partnership and an increasing use of telemedicine are helping to modernize the industry in Broward, even as the county continues to face opioid and HIV challenges. Healthcare remains one of the most important industries in the region, both economically and socially. Health of healthcare Healthcare in the U.S. stands out — and not necessarily in a good way. According to data from the Centers for Medicare & Medicaid Services, U.S. healthcare spending grew 4.3 percent in 2016, reaching $3.3 trillion or $10,348 per person. This accounted for 17.9 percent of the country’s GDP, compared to the 8 to 12 94 | Invest: Greater Fort Lauderdale 2019 | HEALTHCARE
percent share of other developed nations like Canada, New Zealand and the U.K. A survey of over 1,000 physicians conducted by Physician’s Weekly found that participants felt more worried than confident about improvements in 2018. In fact, national health spending is projected to grow at an average rate of 5.5 percent over the next seven years, to reach $5.7 trillion by 2026. The individual mandate, a pivotal part of the ACA, was overturned in the tax legislation passed in December 2017. The mandate subjected uninsured people to a tax penalty in order to keep healthy people insured, thus lowering the premiums for everyone insured. If only people with health issues are insured, rates rise quickly. According to a report by the Kaiser Family Foundation, premiums increased in 2018 partially due to the uncertainty surrounding the individual mandate, which will officially phase out in 2019. The report also predicted that in 2019, individual market enrollment might fall further. While efforts to repeal the ACA in the fall of 2017 failed, the current political climate could spell additional changes. Many healthcare professionals will be watching the 2018 midterm elections closely. A more conservative ( )
HEALTHCARE INTERVIEW
Power of play How Joe DiMaggio Children’s Hospital is innovating care in a tech-forward and playful way, improving patient experience across the board
Caitlin Stella CEO – Joe DiMaggio Children’s Hospital How is Joe DiMaggio implementing new technology to improve care? As we’re planning for our four-floor expansion, we’re talking a lot about what kind of technology will be in place in the next few years, including monitored beds and wearable devices. There will be better technology available to improve and enhance care. Telemedicine, especially for children who don’t live close to pediatric specialists, allows patients to receive care close to home. Parents are of a different generation now, so utilizing technology to deliver care in a way they want to access it is a huge initiative for us. Their expectations for healthcare are different than previous generations. They grew up with the internet and are used to on-demand information, so we’re working to accommodate them and promote two-way communication. Another important trend is the use of data and analytics to predict patient status while they’re in the hospital and after they leave with the use of wearables and home-based technology. If we monitor them as inpatients, we intervene if we see anything out of the ordinary. If they’re at home, we make contact and bring them in so we can treat them preemptively. This avoids stressful emergency room visits. That’s another reason a lot of our procedures now and in the future will be done outpatient and managed remotely: because it improves access to care. We have an excellent reputation, and our brand is such a jewel in our community. We want to keep moving on that trajectory. How does Joe DiMaggio Children’s Hospital harness “the power of play”? The overall patient experience here is unique. Our philosophy is to use play to heal. That’s why we try to get kids home — because that’s where their siblings, school and all the comforts of childhood are. However, if they have to be at the hospital, we try to make it as
playful of an environment as possible, and we do that in a variety of different ways. Our staff is phenomenal. Every single human being you encounter, whether they’re cleaning staff, your nurse, your physician or the security guard, wants to be here and is warm and engaging with patients. We also have programs like child life services, which provides master’s trained child-development experts who are there to make sure patients have what they need to be comfortable and feel like their experience is normal, even when it’s not. We have a full-time medical clown, Lotsy Dotsy. She’s famous, and every child who comes here regularly for chronic care looks for Lotsy. Her presence takes the power of play to a whole new level. She’s even good for staff when something difficult happens. Our approach to care is playful, in general. www.capitalanalyticsassociates.com
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Dr. Hugo Fernandez Chair, Department of Malignant Hematology & Cellular Therapy at Memorial Healthcare System Moffitt Cancer Center
Why is cancer treatment an important area of medicine to focus on? Our population is getting older. Americans today have better healthcare, so cardiac issues aren’t as fatal as they have been in the past. We’ve got better antibiotics and medication across the board, so our population is living longer. Humans are not built to live this long, so we have genetic instability, which often triggers the development of cancer. We are specialists in malignant hematology, which is the treatment of leukemia, lymphoma and multiple myeloma. These are, in and of themselves, not particularly common cancers but collectively are the fourth-largest cancer in men and women. What are the greatest challenges facing the cancer center today? Socioeconomic issues with our patients are a huge issue for us. We work to get care to them as inexpensively as possible. Medicine prices are currently very high, which compounds the issue. This is where the collaboration with our pharmacies comes in; pharmacists know how to get the patients the drugs that they need in the right amount of time without excessive cost. Another challenge is finding staff. Not everybody is comfortable dealing with oncological care; it takes a special person. What makes South Florida unique for research facilities like Moffitt Cancer Center? Before coming to Broward in 2017, I worked in Tampa for 11 years. There is more diversity here, which is both an opportunity and a challenge. We see things here that we didn’t often see in Tampa. For instance, there’s a common disease in the Caribbean caused by a virus that leads to either lymphoma or leukemia in patients. We see it much more here than we would elsewhere in the country. We have an opportunity to collaborate on specific, unique challenges. That’s what our focus is going to be: to build a system that will make those collaborations happen. 96 | Invest: Greater Fort Lauderdale 2019
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( ) government could repeal and replace the ACA, while a more liberal one could reinforce it. On the state level, healthcare was the biggest-ticket item for Florida’s budget passed in the spring of 2018. The budget increased the monthly allowance for nursing home residents by $30 per resident and added $5 million to a fund to combat opioid addiction. Lawmakers eliminated the 90-day retroactive Medicaid eligibility, which is projected to save the state $98 million. Critics say that this cut will impact more than 750,000 Florida residents and will hit seniors and those with disabilities particularly hard. The U.S. News and World Report ranks Florida 34th in the nation when it comes to healthcare. Bright spots include a high number of adults getting annual physicals (around 77 percent), as well as a relatively low mortality rate. Florida scored lower on ease of access to healthcare (48th in the nation), and just 53 percent of adults aged 18 to 64 have health insurance. Healthcare is one of the U.S.’s biggest challenges, and private tech companies are seeing potential for profits as they move to disrupt the current system. In January 2018, Amazon, JPMorgan Chase and Berkshire Hathaway announced that they were teaming up to create a healthcare company to service their own employees. In August 2018, Amazon, IBM, Alphabet, Salesforce and Microsoft made a joint statement at a conference signaling their intent to band together to make health data easier to share between doctors and across hospitals. While enhanced data sharing would improve the quality of care for patients — allowing doctors to access critical health information, whether a patient has allergies or chronic illness — it would also allow these tech giants to play a larger role in the healthcare industry, which employs the largest number of people in the U.S. Local excellence Focusing in on Broward County, the U.S. News and World Report named Cleveland Clinic Florida the top hospital in the tri-county area in 2016 and again in 2018. The hospital was nationally ranked in gastroenterology and gastrointestinal surgery, as well as orthopedics. The system opened a new family health center in Coral Springs in July 2018, expanding its footprint. The 73,000-square-foot facility cost $53 million and will provide imaging and diagnostic services, as well as serve as an ambulatory surgical center. As of August 2018, Cleveland Clinic was in talks to take over Indian River Medical Center in Vero Beach and Martin Health System in Port St. Lucie. Memorial Healthcare System, based in Hollywood, earned all A rankings in 2018 from the Leapfrog Group,
HEALTHCARE OVERVIEW
Marc Cabrera Co-Head– Healthcare Investment Banking at Oppenheimer & Co. Inc.
Healthcare is an industry that continues to undergo massive consolidation. Physicians groups still operate as relatively small businesses. There are many individual hospitals that may be struggling. Seniors across the country are now aging at an increased rate relative to the rest of the population, so we’ll see an uptick in seniors joining the Medicare ranks. There are such fundamental macro waves rolling across the industry that they will continue to see consolidation for the next 10 years.
which ranks hospitals on how well they protect patients from accidental injuries or infections. Memorial reached another milestone in 2018, launching its residency program. The system is working with 31 residents in the internal medicine, pediatrics, physical medicine or rehabilitation programs. This signals the system’s interest in establishing a stronger academic and research presence in the region. Broward Health, one of the largest healthcare systems in the country, ran into some trouble in December 2017, when five leaders of the system allegedly violated Florida’s open meetings laws while firing the system’s interim CEO and were subsequently indicted. The news isn’t all gloomy, however. Broward Health opened a $65 million, four-story tower in August 2018. The Coral Springs facility’s first two floors will provide maternity services, including NICU accommodations, which will
allow parents to stay comfortably with their babies while they undergo intensive care. Holy Cross Hospital was designated as a baby-friendly facility by the Baby-Friendly Hospital Initiative, a program sponsored by UNICEF and WHO, in December 2017. The hospital is the only one in Broward County to have achieved that designation. Thanks to a donation from the Haller Foundation, Holy Cross renovated its intensive rehabilitation unit (IRU) and opened its doors in the spring of 2018. The new therapy center is supplied with new equipment to help those suffering from spinal injuries, Parkinson’s or other ailments. Innovation With South Florida — and Broward County specifically — being high-competition markets for healthcare, local providers need to stand out from the crowd to attract
HEALTHCARE OVERVIEW
Leah Carpenter CEO – Memorial Hospital West
At Memorial Hospital West we are focused on having strong cardiac, orthopedic and neuroscience programs. We focus also on post-acute care and ensuring that when patients are discharged home, they stay healthy. It is imperative that we continue to guide and educate our patients. When I first started my career, you managed patients while they were in the four walls of your facility. Today our focus is to first manage the acute episode of illness and then keep them healthy well beyond their visit to our facilities. patients. Pleasant, bright rooms and green, LEEDcertified facilities are useful tools in bringing patients to a particular hospital, but updated technology and innovative thinking are important as well. Cleveland Clinic’s new facility will feature naturally lit waiting rooms, curated artwork and spacious operating rooms. The private rooms in Broward Health’s new maternity ward are 30 percent larger than average, and the facility boasts two deluxe suites with separate living areas, large TVs and catering options for an additional fee. In February 2018, Holy Cross became the first hospital in the county to use the new Diamondback 360 Coronary Orbital Atherectomy System to reduce arterial calcium buildup caused by coronary arterial disease, the leading cause of death in the U.S. for both men and women. Telemedicine is a tool being used more and more across the globe. A study by the National Business Group on Health reported that 20 percent of employers offering telemedicine saw employees using remote
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health services at a rate of 8 percent or more. The convenience and privacy can also encourage those suffering from trauma or mental health issues to seek treatment when they otherwise may not have. The Veterans Administration (VA) alone delivered 473,000 telemedicine consultations to over 150,000 veterans in fiscal year 2017. The largest telemedicine company in the U.S. is based in Sunrise. In August 2018, MDLive announced $50 million in investments from Cigna and Health Care Service Corporation. The two companies are healthcare leaders and demonstrate that telemedicine is foremost in the minds of healthcare professionals across the county. MDLive, which launched in 2009, announced it passed its millionth telemedicine appointment in May 2018. “Telemedicine is the future across all counties and is important in keeping costs down,” Rachel Sapoznik, president and CEO of Sapoznik Insurance, told Invest:. “More and more companies are embracing
HEALTHCARE OVERVIEW
Jonathan Watkins CEO Broward Health Imperial Point
Broward County’s healthcare providers work hard to make patients a priority.
telemedicine, and we are working to educate people on how to access it. In the next five years, I predict fewer people will be going to the doctor for non-emergencies and more will be utilizing telemedicine.” Insurance Florida ranks 45th in the nation in terms of uninsured residents. 13.3 percent of the population has no insurance, compared to 9.4 percent nationwide. The 13.3 percent is down significantly from the 20 percent Florida had in 2013, before the passage of the ACA. The top 25 Florida Health Insurance companies earned about 4 percent more in 2016 than in 2015, despite covering 120,000 fewer people than in the previous year. Florida Blue was the dominant insurer in Florida again in 2017, capturing $5.9 billion in premiums and covering over 30 percent of the market share. Health Options, Humana and UnitedHealthcare followed with 10, 8 and 8 percent, respectively. Analysts predict that ACA insurance coverage costs will keep pace with medical inflation and increase by about 4 percent nationwide in 2019 (and 5.2 percent in Florida) — much smaller increases than the average in the previous several years, which might allow for some stability in the insurance market for the next few years, depending on the political climate. Public health HIV and AIDS are a widespread problem in Florida. Out of the top 10 metropolitan areas in the country for new infections, four are in Florida: Miami, Fort Lauderdale, Orlando and Jacksonville. Miami-Dade and Broward County are respectively the first and second in the state for newly reported infections with the virus. Steps are
Two big initiatives at Broward Health have significantly enhanced our ability to provide safe patient care. The first is bar code medication administration. The mislabeling or inappropriate dispensing of medications is unfortunately an all-too-common error in healthcare. Barcode medication administration systems are electronic scanning systems that intercept medication errors at the point of administration. When administering medications using this method, a nurse scans a barcode on the patient’s wristband to confirm he/ she is the intended patient, significantly reducing the likelihood of an error occurring. The other is teletracking, which helps us safely and expeditiously place patients in the appropriate setting along the care continuum. With teletracking, we’re able to leverage the beds and resources available across our entire health system to ensure that patients have access to the safest and highest-quality care in the most efficient manner possible. If a patient comes into the hospital and it’s determined that there’s a need for a service that we don’t offer, we’re able to contact one of our sister facilities and make arrangements to have a physician ready to accept that patient when he/she arrives. We are investing significantly in the organization. It’s our goal to renovate several key areas of the hospital, starting with the lobby and main entrance so that it reflects the phenomenal care that we provide. One of the other items that we’re working toward is the establishment of a Program of AllInclusive Care for the Elderly (PACE). The PACE program will allow us to offer comprehensive medical and social services to community-dwelling elderly individuals. Because of the comprehensive nature of the services we will offer, participants will be able to remain in their homes rather than be forced to move into a nursing home. We want to reinvest in the facility to show the community that we’ve been here for over 45 years, and we are here to stay. Five-star treatment is what our community deserves, and five-star treatment is what we will provide at Broward Health Imperial Point. www.capitalanalyticsassociates.com
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JeffreyWelch CEO Florida Medical Center
How is Florida Medical Center embracing innovation? We have to make sure we have the appropriate technology. Technology changes every day. We have two robots here for robotic surgery. One of those units costs about $2 million. We are paid the same for each laparoscopic cholecystectomy, with or without the robot, but it’s so much better for the patients because the procedure is less invasive, takes less time and allows patients to get back to their lives sooner. That’s what technology should provide: better experiences and higher quality for our patients. We have telemedicine for neurology, and we’re looking to start it for behavioral health and dermatology. I suspect that in the next 10 to 15 years, we will see a lot more telemedicine, even in disciplines that are a little uncomfortable with it, like hospitalists. I’ve seen telemedicine live and working in a lot of large, well-run facilities. It’s the way to go to decrease costs and increase quality. However, key to healthcare is the relationship between the physician and patient. Telemedicine can cause that relationship to feel less personal. What are some of the greatest challenge facing local hospitals today? Reimbursement is pretty tough now. It has gone down, which is troubling to see. Aside from the political debates, changes to the ACA hurt some hospitals and helped others. Another issue is that the healthcare industry is tremendously condensed in Florida. There are multiple hospitals close to one another with duplications of services, which causes a lot of competition. One of the benefits of the Tenet system is that there is synergy between our hospitals. Regardless of which of our facilities patients go to, they will have access to every level of service they need. I’m not so sure that’s the best thing for the economy or the healthcare industry as a whole. Healthcare facilities should be a little bit less competitive and more focused on working together. 100 | Invest: Greater Fort Lauderdale 2019
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The healthcare industry provides direct employment for more than 70,000 residents in South Florida.
being taken to help address this issue. In December 2017, the Surgeon General of Florida mandated that all counties in Florida will need to offer pre-exposure prophylaxis (PrEP) treatments at no cost by the end of 2018. HIV testing has become easier after a law change, and the Department of Health has begun a program to offer newly infected people a free 30-day supply of antiretroviral drugs (ARVs) while they work through the insurance issues to access treatment regularly. In 2018, the AIDS Healthcare Foundation, a Californiabased nonprofit that serves about 2,000 HIV-positive people in Broward and Miami-Dade counties, sued the state over access to public records after its contract was not renewed for 2019. A disruption in service providers can make getting care more difficult for this already disadvantaged population. Opioid addiction is presenting problems across the country. Overdose deaths increased by 7 percent nationwide to over 72,000 in 2017. Since 2002, the Centers for Disease Control and Prevention estimate over a four-fold increase in deaths caused by opioids. In Florida, the issue has escalated quickly. In 2016, there were more than 1,500 deaths related to synthetic opioids, compared to 200 in 2013. Florida passed a new law regarding the epidemic that went into effect in July 2018. The law restricts the number of days a physician can prescribe acute pain prescriptions and requires extra documentation in specific cases. Memorial Healthcare has begun to offer the Memorial
CONSTRUCTION ECONOMY OVERVIEW
Jeffrey Freimark President & CEO Miami Jewish Health System
Medication Assisted Treatment program to help individuals overcome their addiction by addressing behavior issues and drug cravings. The healthcare system also offers the Mothers in Recovery program, which is tailored to pregnant women struggling with addiction. Florida’s west coast was gripped by another red tide in the summer of 2018. Caused by the organism Karenia brevis, people exposed to the tides can experience coughing and trouble breathing. The affected area covered 130 miles of the state’s southwest coast, and the governor called a state of emergency for seven affected counties. One allergist saw a 20 percent increase in patient visits during the red tide episode. In October 2018, tests confirmed the presence of the ride tide in Palm Beach, Broward and Miami-Dade counties, which could impact the health of visitors and locals alike and may put a damper on tourism in late 2018 and early 2019. Senior health Florida’s senior population has specific health needs that local facilities are working to meet. Florida’s population is older than average, with 22 percent children (0-18), 8 percent young adults (19-25) and 19 percent older residents (65+). The national average is 24 percent children, 9 percent young adults and 15 percent seniors. Statewide, things have changed since 2017. Since the death of 12 residents at a Hollywood nursing home during Hurricane Irma, new rules went into effect that
How do Miami Jewish Health’s PACE programs help local seniors? Our Florida PACE Centers (Program of All-inclusive Care for the Elderly) are designed to help address health, wellness and social issues for seniors living in South Florida. The aim of PACE is to keep the elderly out of nursing homes, allowing them to remain living in their own homes and communities. PACE participants receive comprehensive medical care and regularly enjoy a variety of physical and social activities. Qualifying seniors must be 55 years or older, participate in Medicaid or Medicare and Medicaid and be nursing home eligible. The program works well because it provides free transportation to and from the PACE Centers to doctor appointments and sometimes even sends caregivers to participants’ homes. We’ve been supported by Broward County and the cities of Pembroke Pines and Miramar. Those entities have been very actively engaged and have been strong partners. Our Florida PACE Center in Miramar has recently reached 100 participants. What types of challenges do seniors face with regards to housing in general? Seniors can age in place in their current homes or look for senior-specific housing. Housing and medical care can pose huge challenges for low-income seniors. The affordable housing we provide on our Douglas Gardens campus in Pembroke Pines typically has a five-year wait. We know getting by can be difficult for seniors, who sometimes must choose between paying their rent, buying their medication and purchasing food. These difficult choices obviously affect an individual’s physical and emotional health. Those looking to remain at home also face challenges. Transportation is a major issue, and many of the elderly need someone to check up on them. That’s why PACE works so well: we aren’t just sitting back and waiting for folks to come to the center through our transportation. Our physicians and registered nurses proactively check up on them. www.capitalanalyticsassociates.com
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HEALTHCARE OVERVIEW
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HEALTHCARE OVERVIEW
Richard Becker Managing Partner – Cross Keys Capital
Healthcare is always big here, but the number of healthcare transactions is off the chart. That industry tends to be about 40 percent of the deal flow in our region. The healthcare industry has been a huge boon to the economy because the buyers are consolidating very quickly. There has been a big uptick in healthcare in the large, populous areas of the U.S., which include Florida. Healthcare services is absolutely booming in the areas of the country where people want to live.
require backup power at all of Florida’s nursing homes and assisted living facilities. As of May 2018, only 91 of the state’s 3,000 assisted living facilities were in compliance with the new regulation. Hundreds more have filed for extensions. While the policy may be slow to take root, this legislation will help make Florida a safer home for its senior residents. The state’s 2019 budget, approved in March 2018, added $50 million for nursing home funding. When coupled with additional federal funds amounting to $80 million, funding for nursing homes will increase by $130 million, allowing for higherquality care. Advances in treatment for hip replacements will benefit local residents. Broward Health North completed the first anterior (as opposed to lateral or posterior) hip replacement in South Florida in 2018. This approach allows the surgeon to avoid detaching muscle or the femur bone, cutting recovery time. Cleveland Clinic continues to be a leader in Alzheimer’s research and surveyed recent clinical trials to determine promising areas for future study, including an increased use of biomarkers and the potential of infused antibodies. These are just a few examples of strides being made in Broward towards greater health for seniors in the region.
legalizing recreational marijuana, according to a 2017 Gallup poll. Florida voters approved the drug for medical use in 2016, and since then cannabis-based businesses have been popping up across the state. Marijuana Doctor, an evaluation clinic company, has 15 clinics statewide with plans to add another 30 by early 2019. Until 2018, Broward had no clinics because its major cities disallowed them. In March, Fort Lauderdale’s moratorium on dispensaries expired, allowing the city’s commission to consider opening a Cannabis Education Center, run by Canada-based Liberty Health Sciences, near Holy Cross Hospital. The facility would be the city’s first. Broward’s first dispensary was opened by Massachusettsbased Curaleaf in September 2018 in Deerfield Beach.
In March 2018, Fort Lauderdale’s moratorium on marijuana dispensaries expired.
Medical marijuana In June 2018, Canada legalized marijuana for recreational use, and Oklahoma became the 30th state to legalize marijuana for recreational or medical purposes. 64 percent of U.S. adults support
Healthy future Healthcare in Broward County continues to fuel economic growth in the region by providing jobs and allowing for technical innovation to change the healthcare system as it currently exists. Despite challenges, including the low rate of insured residents in Florida, the area is making strides towards providing better healthcare and emphasizing wellness as a tool to keep people healthy and out of hospitals in the first place, lowering costs for patients and healthcare providers alike. Broward staples, like Broward Health and Cleveland Clinic, alongside newcomers, including medical marijuana dispensaries and Amazon, are working together to create a healthier and more vibrant Broward County. www.capitalanalyticsassociates.com
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City of Lauderhill: At the heart of Broward County, the City of Lauderhill is well positioned to enjoy the offerings of Fort Lauderdale and Miami. Despite its humble beginnings as an agricultural outpost, Lauderhill has matured into a diverse city, home to myriad small businesses and industries, cultural attractions, renowned cuisine and the only ICCsanctioned cricket stadium on North American soil. The city’s high quality of life is a major draw for young families or anyone looking for a slower pace while maintaining access to big-city amenities.
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Vibrant city: The City of Lauderhill has evolved from humble beginnings into a thriving and diverse hotspot for the live-work-play lifestyle The City of Lauderhill occupies one of the most strategic and beautiful locations in southeastern Florida. The city is in the heart of Broward County, roughly seven miles northwest of Fort Lauderdale and 35 miles north of Miami. Three international airports are all within an hour’s drive: Fort LauderdaleHollywood International Airport is about 13 miles away, Miami International Airport is about 25 miles away and Palm Beach International Airport is about 56 miles away. This central location gives individuals and businesses in Lauderhill easy access to everything the region has to offer and has earned the city the nickname “Crossroads of Broward County.” Within the city itself, internationally renowned cuisine and small, independent businesses attract tourists from across the state, the country and the world, while Lauderhill’s affordable real estate, lovely parks and numerous other attractions make it a place where a growing number of families are choosing to settle down. From dairy to development Lauderhill was incorporated on June 20, 1959, with a real estate developer by the name of Herbert Sadkin 106 | Invest: Greater Fort Lauderdale 2019
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credited as the city’s founding father. The origin of the name Lauderhill lies in a bit of playful banter between Sadkin and one of his friends, William Safire. When he originally envisioned the city, Sadkin had planned to name it Sunnydale; however, Safire, who was a journalist for the New York Times, pointed out that the name was too similar to that of a neighborhood in Brooklyn. When discussing alternatives, Safire mentioned that he liked the wordplay between “hill” and “dale,” to which Sadkin responded that there were no hills in his new city. Safire’s rejoinder was that he doubted there were any dales in Lauderdale either, and from that backand-forth the name Lauderhill was born. Once Lauderhill was named and incorporated, the next step was filling it with people. Unfortunately, it was difficult to entice people to what was then seen as “dairy farm country.” Indeed, Lauderhill was originally home to more dairy cows than people. To remedy this, the neighborhood of Inverrary was built as a revolutionary planned urban development. This meant that the entire community was fully planned before any building began in order to maximize its appeal and convenience. This neighborhood is ( )
CITY OF LAUDERHILL INTERVIEW
Live, work, play How the City of Lauderhill is investing in strategic plans to position itself as a hotspot destination for residents and tourists alike
Kenneth Raymond Thurston Mayor Elect – City of Lauderhill What is the city doing to attract business to the area? The City of Lauderhill Office of Economic Development recently completed a market analysis and developed a retail business attraction plan. The plan identifies our market potential and outlines the strategies we will be focusing on over the next few years to attract new restaurants, breweries and distilleries, retail shops, entrepreneurs, credit tenants, target industries and even a hotel. Some of the recent grand openings and business attraction projects we’re excited about are Lallo’s Roti and the Economic Development Office’s new business attraction event series. Lallo’s Roti is an 8,500-squarefoot restaurant, club and event venue located on State Road 7, just a short walk from the new Lauderhill Performing Arts Center and the Central Broward Regional Park. This restaurant is the first of what we anticipate will become a hotspot destination along the State Road 7 corridor in our arts and entertainment district. How can Lauderhill build on the success of its cricket pitch and performing arts center to bring more culture and tourism into the area? Lauderhill is in an exceptional position to capitalize on the South Florida visitor market. Our Lauderhill Performing Arts Center (LPAC) recently partnered with Stage Door Theatre company and is drawing record crowds from around the region. We’re tracking our visitors and will continue to engage our current cultural audience before, during and after their visit to Lauderhill. Our approach is to also attract new audiences, increase the number of visits by our current audience and increase the amount of time and money visitors spend in Lauderhill. The cricket stadium, coupled with all the activities held at the Central Broward Regional Park, present an exceptionally exciting opportunity. We have a strong, committed tourism committee that is currently developing a strategic marketing plan that
will establish specific objectives for capitalizing on opportunities within our current market and expansion of that market. We believe all of our efforts to make Lauderhill a great place to live, work, learn, play and invest work in concert together to reach our goals. What is your outlook for the city for the rest of 2018 and into 2019? The outlook for the rest of 2018 and into 2019 is positive. Overall, property values in Lauderhill continue to increase. The city is carefully spending the $44.5 million General Obligation Bond Issue, which was approved by voters in 2016. This bond issue is increasing safety and making the city more attractive for business relocation and development. Additionally, the city will co-sponsor events in 2019 that will showcase the ethnically diverse population and the many unique restaurants in our city’s borders. www.capitalanalyticsassociates.com
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( ) home to the Inverrary Country Club, the former home of the Jackie Gleason Inverrary Golf Classic. Another key piece of the city’s history is the Lauderhill Mall, which opened in 1966 and was the first enclosed, air-conditioned shopping mall in the southeastern United States. Finally, the northwestern part of the city was developed as a single-family housing plan in the 1970s to accommodate the influx of families to the area. Diverse economy Lauderhill is an extremely diverse community, which has helped it to develop the robust economy that it enjoys today. Some of the city’s earliest residents were snowbirds who fled from cold northern winters to Lauderhill neighborhoods. As the city continued to develop throughout the 1970s, ’80s and ’90s, however, the community quickly diversified and began to attract people of many different ages and ethnicities. Thanks to an increasing number of young professionals and families moving to the area, the average age of Lauderhill residents is a youthful 35.9. Of the city’s estimated 71,970 year-round residents in 2018, 77.7 percent are black, 16.8 percent are white, 2.2 percent are two or more races, 1.5 percent are Asian and the remaining 1.4 percent are some other race. A particularly strong Caribbean community also exists within this melting pot, with many residents hailing from island nations like the Bahamas, Jamaica, Haiti and Trinidad and Tobago. The average household income in Lauderhill is $51,081, and the value of an average residential home is $115,300, 63.6 percent of which are owner-occupied. “My family and I have a long history with the City of Lauderhill,” Jason Ho, owner at Lobster Seafood & Warehouse, told Invest:. “I was actually born and raised in the city, and my family opened the first Chinese buffet in Broward County in 1979, which was also located in the city. You can say Lauderhill is special to us. We decided to place our headquarters in Lauderhill because it provides easy access for logistics with proximity to the port and airport. Elsewhere in the county either wasn’t zoned for our purposes or the rent was not affordable for a small to medium-sized business. Lauderhill provided for both.” In order to maintain the growth of Lauderhill’s economy, as well as its diverse population, on August 30, 2016, the city’s residents approved a referendum that allows the city to issue $44.5 million in general obligation bonds to fund 30 capital improvement 108 | Invest: Greater Fort Lauderdale 2019
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The Lauderhill Performing Arts Center (LPAC) provides diverse, quality performing arts programming to residents and visitors.
projects that were supported by residents in a series of public meetings with city officials. The projects involve upgrades to parks, public safety systems and general infrastructure improvements. Some notable examples include adding lights and security cameras throughout the city; making improvements to various community centers; acquiring land to construct new parks; and repairing and improving roadways citywide. Many of the projects are well underway, with construction contracts already awarded and work in progress. The city also uses its $118 million budget to carry out frequent capital improvement projects to make Lauderhill an even more desirable place to live, including the construction of the 1,200-seat, 47,585-square-foot performing arts theater and Broward County Public Library; replacing the 50th Street culvert; resurfacing Inverarry Boulevard; resurfacing 55th Avenue; modifying Ilene Lieberman Park to include updated landscaping and
CONSTRUCTION ECONOMY OVERVIEW
Charles Faranda City Manager City of Lauderhill
How has Lauderhill’s past helped to evolve the city into what it is today? Lauderhill’s history is the foundation, or DNA, of who we are and continue to be today. We began as a fabulous community known as a winter vacation and retirement destination and have grown into a thriving and diverse city that is still a fantastic place to live, work, visit and enjoy. From the first enclosed mall in the Southeast built in 1966 and the Jackie Gleason Inverrary Golf Classic of the 1970s, to the more recent opening of the Lauderhill Performing Arts Center and being home to the only International Cricket Council (ICC) certified cricket stadium in the U.S. — all of this illustrates how our original leaders’ passion for entertainment and sports can still be experienced today.
more comfortable seating to encourage increased attendance of live performances; and constructing an additional fire station at NW 31st Avenue and 12th Street. Of course, the City of Lauderhill is not only dedicated to being a great place to live; it is also a prime location to do business. Most recently, Lauderhill was recognized as one of the best small cities to start a small business, ranking 13th nationally. Over the past five years, citywide sales volumes have increased, commercial real estate prices per square foot have climbed and commercial vacancy rates have dropped. Some of the biggest sectors in Lauderhill are healthcare, retail and professional, scientific and technical services. Healthcare accounts for 22 percent of total jobs in the city; retail represents 15.7 percent of jobs; and professional, scientific and technical services makes up 15.5 percent of jobs. Lauderhill is also a noteworthy logistics hub, with an abundance of federal post
What makes Lauderhill such a great place to do business? Lauderhill is experiencing an excellent season for growth and opportunity right now, and we’re getting noticed. In August of this year, we received recognition by Fios, Verizon Business Resource Center, for being number 13 among the 50 best small cities in the U.S. to start a small business. The cities were evaluated “by the numbers” based on population, education, travel time to work, income per capita, broadband access, loans per capita and tax scores. We have a collective vision, a progressive elected body and an exceptional team of professionals who are dedicated and passionate about furthering the city’s goals, which include being business friendly and forward thinking. Our new campaign, which we recently launched at the International Council of Shopping Centers Regional Conference, is “Experience Our Culture, Elevate Your Potential, Explore Lauderhill.” We’re absolutely committed to helping entrepreneurs elevate their potential, and we’re actively highlighting the exceptional opportunities emerging due to our economic development and redevelopment efforts. www.capitalanalyticsassociates.com
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offices, a large UPS shipping and distribution center, and several international shipping companies located in the City’s Industrial Park. The city has convenient access to all major Florida highways; the Florida Turnpike, Interstates 75, 95 and 595, and the Sawgrass Expressway all within 5 miles, making it an ideal location for businesses that need to do a lot of shipping of goods and materials. It really is the Crossroads of Broward County. Hot market Given its origins as an expertly planned community founded by a successful property developer, it’s not surprising that Lauderhill continues to be a hotspot for real estate deals. One major transaction that took place in 2018 was the $28.5 million sale of Summit Palms, a 352-unit, multifamily community located at 4491 NW 19th Street. The luxury units feature upgraded kitchens and baths, private balconies and come in one-, two- or threebedroom floorplans. The community also has easy access to major roadways and is expected to attract increasing numbers of young professionals as demand continues to outweigh supply in Lauderhill. Another ambitious development project that is proposed will result in the construction of a 127bed assisted living facility directly east of the Synagogue of Inverrary Chabad. The synagogue plans to build the 100,000-square-foot facility, including a Glatt Kosher kitchen, at 6700 NW 44th
Street and then turn it over to be managed by New York-based assisted living operator MJM Associates. The facility will be named Aishel House and will cater to Jewish Orthodox seniors suffering from Alzheimer’s disease. Another big deal that closed in 2017 was D.R. Horton’s $4.8 million acquisition of a large townhouse project in Lauderhill from Cricket Club Lauderhill, LLC, which purchased the property for $2.5 million at a foreclosure sale in 2015. Known as the Cricket Club, the 10.35-acre development at the corner of Sunrise Boulevard and U.S. 441 was approved in 2016 and contains 155 townhouses. The development is conveniently located near Lauderhill’s acclaimed international cricket stadium and Central Broward Regional Park, which sees over 500,000 visitors annually. Residential development firm Behar Font Partners has chosen Lauderhill as the new location for its high-end, multifamily apartment complex. The 307 posh units will be offered in a range of floor plans, from one-, two- and three-bedroom units. The amenities will feature a bliss-inducing pool, state-of-the-art gym and spectacular clubhouse suited for work and play. Construction of the upscale housing project is set for the first quarter of 2019. Acquired by GranVita 2, LLC, the famous Inverrary Resort Hotel was purchased in a 2017 auction. Under the vision of Luis Navas, the site is undergoing major
Lauderhill has convenient access to all major Florida highways, making it an ideal location for businesses that ship a lot of goods and materials.
Sean Henderson Director– Lauderhill CRA
The Lauderhill CRA is a TIF-less CRA in Broward County, so our main focus is guiding and connecting businesses and investors with available incentives through the county, state and federal governments. For example, with 8,700 opportunity zones currently designated in the U.S., we are thrilled that areas of Lauderhill received the designation. This additional incentive for investment, coupled with our commitment to and investment in these areas, simply creates a significant win-win scenario.
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LAUDERHILL OVERVIEW
World-class acts, such as Boyz II Men (seen here), perform at the Lauderhill Performing Arts Center, but the city is also home to various free classes, concerts and festivals throughout the year.
renovations to restore the locale to modern grandeur. Originally built in the 1970s, the resort featured a 23,573-square-foot clubhouse and 30 tennis courts for entertaining the patrons of the 207 deluxe rooms. Mr. Navas expects to offer future guests walking trails, recreational areas and a golf course that would meet the renowned Professional Golfers’ Association standards.
opportunity zones. This program is advantageous to savvy investors, as it allows them a chance to defer the tax burden of their capital gains by reinvesting those profits into a qualified opportunity fund. Statewide, the U.S. Treasury approved 417 total opportunity zones, of which 123 are located within South Florida’s tri-county region. Broward County claims 30 of those zones.
Opportunity zones In 2018, as part of the Tax Cuts and Jobs Act passed by Congress in December 2017, Florida’s governor and the U.S. Treasury secretary recognized three of Lauderhill’s census tracts as opportunity zones. As part of the Opportunity Zone program, each state’s governor nominated up to 25 percent of its eligible census tracts to become
Pedestrian friendly City officials in Lauderhill noticed an increasing jaywalking problem in their community. In fact, Broward County is ranked second in the entire State of Florida for pedestrian and cyclist fatalities. The vast majority of these accidents are caused by the tendency of pedestrians in the region to cross mid-block rather than at the
In 2018, Florida’s governor and the U.S. Treasury secretary recognized three of Lauderhill’s census tracts as opportunity zones.
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Craig Gundry General Manager Fassmer Technical Projects
What is a recent or near-launch innovation developed by Fassmer in Lauderhill? One of our most exciting innovations is the seven-meter Fassmer Raptor, which is a boat that can be utilized as a fast detached craft for military, police patrol and the U.S. Coast Guard, as well as for rescue operations, whether it’s rescue boats on cruise ships, commercial vessels or oil and gas vessels. What makes it innovative is the design. The Raptor is designed in such a way that increases the safety of the people operating the boat due to its better handling and performance capabilities, even in rough seas. The ride is much smoother than typical. It also is also more environmentally friendly because you’re able to get the same amount of performance with less horsepower and with a dramatic increase in miles per gallon. Can you speak a little about Fassmer’s contributions to green technology? Fassmer Technical Projects just opened as a new division this year, but Fassmer as an organization out of Germany has been around for 168 years. It is a family-owned company in its fifth generation. One of the key things that Fassmer has always been involved in is innovation, and in particular innovation focused on environmental technology that includes LNG and wind power. One of our focuses here at Fassmer Technical Projects is to bring some of these new, innovative technologies that have been developed by our headquarters in Germany and produce them here, creating more jobs and more opportunity for the company in the U.S. and in Lauderhill. Where Fassmer Technical Projects has really started to contribute and provide an option to push forward the environmental equipment initiative is that we’re able to provide vessel owners with the ability to integrate green technologies on their vessels while minimizing cost impact and the amount of time their ships are out of service. This helps protect our atmosphere and oceans without significantly disrupting owners’ ability to gain revenue. 112 | Invest: Greater Fort Lauderdale 2019
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designated crosswalks. In response, the city passed a resolution endorsing Pedestrian Safety Through Environmental Design Principles (PEDSTED), which is a collection of guidelines designed to discourage people from crossing major roadways at dangerous and undesignated points. The capital improvement projects discussed earlier, among others, are being implemented with PEDSTED in mind. Lauderhill is simultaneously taking proactive measures to enforce and fine repeat jaywalking offenders. This heightened vigilance is funded by a $100,000 grant from the Florida Department of Transportation (FDOT) and the University of South Florida Center for Urban Transportation, which was used to pay the overtime of officers monitoring jaywalkers. Expectedly, PEDSTED and the stricter enforcement of anti-jaywalking laws will keep Lauderhill’s pedestrians safer. Educating minds One of the most important things to young families with children when they are looking for a place to live is high-quality schools. Fortunately, Lauderhill’s leadership understands this and is making concerted efforts to improve its educational facilities, both private and public. Among the schools that service Lauderhill residents is Lauderhill 6-12 STEM-MED, a Broward CountyPublic School with the mission of preparing students to succeed in college and life. In order to ensure the excellence of all of its schools, Broward County Public Schools implemented the School Improvement Plan system, which provides a mechanism to identify the needs of schools and students alike and to meet those needs at the individual school level. This is a living plan, meaning improvements are ongoing and revised as needed. This system operates in Broward County Public Schools throughout Lauderhill, including at Lauderhill 6-12 STEM-MED. Additionally, the City of Lauderhill is providing scholarships to Broward College for successful students to pursue a career in fire sciences. Arts, culture and cricket Lauderhill has grown from a small dairy farming community in the Everglades to a vibrant community that attracts visitors from throughout Florida and beyond thanks to its robust variety of cultural and entertainment venues. One prominent cultural institution is the Lauderhill Performing Arts Center (LPAC), which officially opened on January 20, 2016.
CITY OF LAUDERHILL OVERVIEW
Jammin’ in the Park is presented in conjunction wtih LT’s Throwback Golf Tournament, and proceeds benefit Fore Life. This free festival includes live music, art, raffles and lots of tasty food and drink options.
The LPAC enriches Lauderhill and its neighboring communities through the provision of diverse and high-quality performing arts, including music, theater, dance, cinema, visual arts and more. Most recently, the LPAC has expanded its offerings by partnering with Stage Door as its resident theater company. The highly regarded theater group will produce more than 175 shows per year. Along with being a hub of community involvement and general artistic expression, the LPAC is a magnet for economic growth. The building is a LEED Silver structure and was built with $5.8 million from the City’s 2005 General Obligation Bond and matching funds from the Broward County Park Bond.
Lauderhill is also home to the only cricket stadium in North America that is officially recognized by the ICC. The stadium was opened in 2007, and the whole park cost $70 million to build. It is a significant cultural and economic benefit to Lauderhill and Broward County, attracting fans of the sport from all over the world. In addition to cricket, the stadium hosts Australian Rules football, American football, rugby, soccer and concerts in order to augment its revenue beyond the money brought in by cricket alone. Finally, Lauderhill is home to various free classes, festivals and concerts, such as the Green Series,
Jo Mini Manager– Tate’s Comics Inc.
Our biggest concern with serving the community is to make sure we are actually a part of the community. We hold many events year round that are open for all to come and are geared to a large swath of the community. Be it Tate’s Not at Comic-con, our twice yearly sales or Star Wars Day, all of these are community focused and aimed at getting the people of Lauderhill not only into our store but also together to talk, have fun and maybe even make a new friend.
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CITY OF LAUDERHILL OVERVIEW
The City of Lauderhilll has made an effort to partner with local businesses on new and creative events that help bring people to both the stores and the city.
Jammin’ in the Park & Art Fest and the new Pork, Pints & Palettes Beer-B-Q event. Growing pains The primary challenges facing the City of Lauderhill are not unlike those confronting other growing cities across the United States. With regard to real estate, Lauderhill’s original period of development throughout the 1960s and ’70s means that many of its existing properties are older and in need of retrofitting or replacement. On the one hand, this situation has kept the median property values relatively low despite the intense demand, but it could also be deterring young professionals and their families from buying property, as these demographics often prefer more modern accommodations. Fortunately, there are many real estate development projects underway that will help to address the shortfall in state-of-theart housing. The city is also proactively addressing the related problem of dated infrastructure and utilities by replacing and improving various roads and water systems.
Bright future Lauderhill has come a long way since its humble beginnings as a small community in dairy country. Today, it is a diverse and thriving city of young professionals, with alluring cultural attractions, a stateof-the-art performing arts center, numerous small businesses, an array of authentic international cuisine and the only certified international cricket stadium on North American soil. As it continues to grow along with the rest of Broward, it will attract new residents and become home to a wider mix of businesses and attractions. Thanks to the efforts currently being made by city officials, the Lauderhill of the future promises to be an even more vibrant and livable community than even Herbert Sadkin and his co-founders could have hoped for when they incorporated the city all those years ago.
Today, Lauderhill is a diverse and thriving city of young families and professionals.
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Capital Analytics would like to thank the City of Lauderhill for its contribution in compiling this chapter. To learn more, visit their website: www.lauderhill-fl.gov.
Banking & Finance: Escalating trade wars, rising interests rates, deregulation and rollbacks: it’s been an atypical year. Amid all the chaos, South Florida’s financial activity remains steady in the foreseeable future. Jobs in the financial sector are up, as are commercial and industrial loans. The steady growth in the workforce has been facilitated by the area’s world-class amenities. With the economically diverse and entrepreneurial atmosphere in Broward County comes strong commercial banking and wealth management opportunities.
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BANKING & FINANCE OVERVIEW
Banking & Finance in numbers: South Florida banks with the most dollar loan growth in 2017 : $2.02 billion BankUnited $1.74 billion City National Bank of Florida $1.33 billion Florida Community Bank $317 million
Top five South Florida banks by percent
Mercantil Bank
loan growth in 2017:
$202 million Ocean Bank
32.6%
$145 million Professional Bank
City National Bank of Florida
$123 million BAC Florida Bank
45.2%
$110 million Biscayne Bank
Professional Bank
$95 million Marquis Bank
28.2%
Sunstate Bank
26.1%
Marquis Bank
22.5%
$91 million First National Bank of South Miami
First Bank of the Palm Beaches
Source: Federal Deposit Insurance Corp.
South Florida banks with the most dollar loan growth in Q2 2018 : $405.7 million BankUnited $402.7 million City National Bank of Florida $271.3 million Mercantil Bank $214 million Florida Community Bank $108.3 million Banesco USA
Top five South Florida banks by percent loan growth in Q2 2018:
$46.8 million U.S. Century Bank
13.3%
$43.8 million Professional Bank
Banesco USA
$30.4 million Flagler Bank
17.7%
$24.9 million International Finance Bank
Flagler Bank
$24.5 million Marquis Bank
12.6% First Bank of the Palm Beaches
11.3%
Plus International Bank
22.5%
Source: Federal Deposit Insurance Corp.
Professional Bank
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BANKING & FINANCE OVERVIEW
Favorable conditions: Despite global tensions and trade wars, tax reform, deregulation and rising interest rates are fueling a strong financial sector Financial deregulation, rising interest rates and lower taxes spell good news for the U.S. banking and financial industry, despite concerns over the impact the escalating trade war and heating global tensions could have on corporate America. While nationwide banks’ commercial and industrial loans expanded only 0.4 percent in May 2018 after a 12.5 percent rise in April, South Florida’s financial activity remained steady going into the second half of 2018. From March 2017 to March 2018, Broward County financial activities added 800 jobs. The county’s overall labor force grew 1.3 percent year-over-year to 1,037,489 and added 11,500 non-agricultural positions. This steady growth is fueled by the area’s world-class amenities, bustling arts community and high-quality educational institutions, all of which attract businesses and investors and inject critical capital into the region. As Paul Tanner, founder and managing director of Las Olas Capital Advisors, told Invest:, “We focus on wealth creators as opposed to wealth inheritors. Typical South Florida wealth managers would do a lot of business in Boca or Palm Beach, but the newer wealth is being created here in Broward and Miami-Dade.”
Lending landscape In Q1 2018, South Florida’s 42 banks boosted their combined loan portfolio by $1.33 billion, or 2.3 percent, according to the Federal Deposit Insurance Corporation (FDIC). The areas that experienced the strongest loan growth were commercial real estate, with $540 million; home mortgages, with $510 million; and commercial and industrial lines of credit, with $290 million. Multifamily lending was lukewarm, and construction loans increased by a modest $90 million. The collective nonperforming loan ratio for South Florida’s banks was only .68 percent. Weston-based Florida Community Bank (FCB) — South Florida’s second-largest bank with $10.04 billion in assets — led the pack with $716 million in loan growth in Q1 2018. FCB was third in loan percentage portfolio growth, at 9 percent, and Forbes again ranked it as one of the 10 best banks in the U.S. for the second year in a row. Since its founding in 2010, FCB has seen significant and surprisingly organic growth. In November 2017 the bank made its first acquisition in nearly four years, purchasing Davie-based Floridian Community Bank for almost $88 million. After breaking the $10 billion asset ceilwww.capitalanalyticsassociates.com
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BANKING & FINANCE OVERVIEW
ing, the bank planned to focus more on small business lending and specialty lines of business. In July 2018, Synovus Financial Corp. announced it would be buying FCB’s parent company, FCB Financial Holdings, for $2.9 billion, giving the Georgia-based bank its first foothold in the tri-county area. The deal is expected to close in Q1 2019, subject to shareholder approval from both companies. New blood According to the FDIC, there were 1,042 de novo community banks chartered in the U.S. from 2000 to 2008. From 2011 to 2017, the FDIC received only 30 de novo applications for deposit insurance. Of those 30, six were approved, 10 withdrawn and 14 are still outstanding. At the end of 2017, the number of U.S. banks fell below 5,700 — a low the industry hasn’t seen since the 1800s. Today, South Florida has 42 banks; a decade ago that number was closer to 80. Some reasons for this significant shrinkage include low interest rates, tight regulations under Dodd-Frank and new developments in financial technology pushing banks to offer more products and consumer-friendly services. Over the past decade, South Florida banks have been faced with one of two choices: acquire or be acquired. The landscape is beginning to shift, however. Interest rates are on the rise, with three increases in 2017 and another three already in 2018, and new legislation passed in May rolled back some of the heavy restrictions of
Dodd-Frank. Recently, the FDIC has indicated that it is open to accepting applications for new charters. Hoping to capitalize on this warming environment, a group of former bankers from Broward County community banks is working on raising about $22 million to open Coastal Community Bank in Hollywood, Florida, in Q3 2018. The bank received FDIC approval in July, marking South Florida’s first de novo bank in nine years and the fourth to be approved by the FDIC nationwide in 2018. Loosening chains In May 2018, Congress approved and President Trump signed a bipartisan bill that rolled back the Dodd-Frank regulations put into place following the 2008 financial crisis. Among other things, the Economic Growth, Regulatory Relief and Consumer Protection Act raises the threshold for increased regulatory scrutiny from banks with $50 billion in assets to those with $250 billion. The legislation also exempts banks with less than $10 billion in assets from the Volcker rule, which limits banks’ ability to make risky bets, and exempts small banks from reporting detailed data on borrowers. While the new bill doesn’t completely do away with the strict regulatory regime imposed by DoddFrank, it does substantially water it down. Under the new law, fewer than 10 large U.S. banks will be subject to stricter federal oversight, giving thousands of banks — including many in Broward County — newfound freedom from harsh regulatory burdens.
Today, South Florida has 42 banks; a decade ago that number was closer to 80.
Jeff Klink Regional President - South Florida – Valley National Bank
Short-term interest rates are tied to indexes like the Wall Street Journal prime rate, which in August was at about 5 percent — up over 100 basis points from the year before. It’s not stifling growth, but the price point is higher. For long-term rates, we typically price over the treasury rates, which are up over 100 basis points as well. Five- and 10-year treasury rates have been hovering at just under 3 percent. That increase is compressing debt service coverage ratios.
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BANKING & FINANCE INTERVIEW
Rebuilding trust How Wells Fargo is focused on connecting with small businesses and improving customer service in order to stand out in Broward’s robust financial market
Hector Ponte Southeast Florida Region Bank President – Wells Fargo How does Wells Fargo support the small businesses in the Broward community? Our track record shows that we have been a leading small business lender across the country for multiple years. We have a variety of tools and resources for small business customers, including business plan creation and cash-flow tools, available for free on our website. In addition, if an entrepreneur applies for one of our small business loans and doesn’t qualify, we have a dedicated coaching resource that will work with her to help her understand why she was declined and what she needs to do in order to qualify. When you consider that oftentimes small businesses are not experienced at getting credit or don’t have an accountant or an attorney on staff, having access to a credit coach to help them understand why they didn’t qualify can make a big difference. Right now, optimism is up among small business owners. They’re feeling good about their ability to access capital and to expand or maintain their businesses, which is good for the area. How is Wells Fargo investing in its relationship with its clients? Over the last two years, we have been rebuilding trust with our customers. Every one of our team members is ensuring that we admit our mistakes and move on in a positive way to regain the trust of the communities that we work in. We spent a lot of time retraining our team members and have internally reorganized our structure to streamline management, which brings us closer to our team members and our customers. We are taking the time to carefully think out the best ways to make our customer service better. That’s a formula for success, and I feel positive about the direction the industry is taking.
What challenges face Wells Fargo in Broward County? Right now, if you talk to any of the economic development groups in the area, they will talk about affordable housing and infrastructure challenges. For people who are trying to move here, a big problem is finding housing, as Broward is one of the toughest markets in the nation. That’s a challenge for us; when we add jobs, we can’t always find people to fill them because they find it difficult to move here. When we have openings in branches downtown or near the beach, finding people who live in those areas to work in our branches is difficult. Between traffic and paying for gas, no one wants to pass 10 branches on their way to work. On the other hand, Florida is an attractive state to live in for tax purposes and for the regulatory environment that we’re in. It’s quite a dichotomy. The area has all of this attractiveness alongside big obstacles that together as a community we need to work on. www.capitalanalyticsassociates.com
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BANKING & FINANCE OVERVIEW
James Bonilla Managing Partner – Coastal Wealth
The time to take an hour or two to go over finances is over. Instead of meeting face to face, now we’re doing a lot of virtual meetings. We’re also developing apps for our advisors to streamline their work and their communication. Technology is enabling us to do things quickly. A few years ago, we could realistically have three to four meetings a day. Now we can have eight. Technology is driving the efficiency of our advisors.
Temperature rising In September 2018, the Federal Reserve raised its benchmark federal funds rate — which helps determine rates for mortgages, credit cards and other types of borrowing — a quarter point, from 2 percent to 2.25 percent. This was the third rate hike so far in 2018. A majority of policy makers expect four federal rate hikes this year, a reflection of the hot U.S. economy. With nationwide unemployment at 3.8 percent — the lowest since 2000 — inflation is slowly creeping higher. The Federal Reserve is gradually raising interest rates in order to prevent the economy from overheating. The average rate on a 30-year fixed-rate mortgage climbed to 4.46 percent in May 2018, the highest in seven years, before falling slightly again in June. While mortgage rates typically fluctuate with the bond market, a higher federal funds rate can also cause them to increase. As it becomes more expensive for banks to borrow money, this often translates to higher borrowing rates for consumers. Many South Florida real estate agents and lenders are reporting strong customer traffic as would-be homebuyers accelerate the home-buying process in fear of future rate hikes. The financing arm of Keyes Realty has seen an increase in requests for mortgage pre-approvals in recent months. Regionally, buyer interest has remained strong and prices have remained high despite rising interest rates. Investors are showing some concerns over the yield curve, or the difference between interest rates on short-term U.S. government bonds (two-year Treas-
ury notes) and long-term bonds (10-year notes). In a healthy economy, rates are higher on longer-term bonds in order to compensate for potential inflation. However, with the Federal Reserve’s short-term rate hikes, the yield curve has been flattening. Compounding this, long-term rates have been slower to rise, indicating some concern about long-term economic growth. However, while a flattening yield curve has historically indicated softening market conditions on the horizon, it also suggests that present market conditions might be prime for savvy investment in certain product types. In Broward, where multifamily lending was sluggish in Q1 2018, the flat yield curve signals an opportunity for those looking to acquire multifamily properties to put on longer-term debt.
Interest rates are on the rise, with three increases in 2017 and another three already in 2018.
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Growth and expansion In a swiftly changing financial environment, many South Florida banks are expanding to take advantage of favorable conditions, new markets and fresh sources of capital. Legacy Bank, one of the few remaining locally owned independent banks in Palm Beach and Broward County, announced in January 2018 that it had raised more than $5.5 million through a common stock offering. This capital will allow the Boca Raton-based bank to grow more in South Florida. In March 2018, Marquis Bank announced its expansion into Broward County with a loan production office and a new branch slated to open later in the year in downtown Fort Lauderdale. Professional
CONSTRUCTION ECONOMY OVERVIEW
Bank, based in Coral Gables, also opened a new loan production office in Fort Lauderdale at the end of 2017. In April 2018, West Palm Beach-based Guardians Credit Union filed a merger application to acquire Miami-based South Florida Federal Credit Union. In June, City National Bank of Florida completed the acquisition — for $529 million — of Miami-based TotalBank, making it the third-largest Florida-based bank, with $14 billion in assets. That same month, International Finance Bank (IFB) announced that it would acquire the international deposits and banking team from New York-based Modern Bank. The deal is subject to regulatory approval, but if it goes through it would give IFB additional cash on hand to offer loans. Also in June 2018, Moishe Gubin, chairman of Plantation-based Optimumbank — one of the smallest banks in South Florida, with $88.6 million in assets — announced that he had acquired $6.6 million of the organization’s outstanding debt. His hope is that the deal will help the bank resume growth and boost its lending capabilities. Alternative lending A 2017 survey by Mercator Advisory Group found that 27 percent of U.S. small businesses use online alternative lenders. Millennials were nearly twice as likely as older business owners — at 48 percent versus 25 percent, respectively — to use alternative lenders to finance their businesses. These young entrepreneurs cite ease of the approval process as the main reason for turning to alternative lending sources, as they can typically receive their funding faster than through traditional lenders. This is indicative of a broader trend toward digitization, with a new generation of customers seeking fast, easy and reliable financial services. To capitalize on this changing tide, South Florida fintech companies and financial institutions are increasingly finding synergy as they partner up to provide consumers and businesses with convenient and fast mobile and online service. In June 2018 Fort Lauderdale-based Velocity Solutions acquired digital lending platform Akouba Inc. This merger will enable the company to underwrite loans to small and medium-sized businesses quickly, efficiently and profitably. In 2017, Florida saw the completion of 259 private equity (PE) deals, up from 256 in 2016. The number of PE firms in the state grew from 47 in 2016 to 56 by the end of 2017. In 2018, the state continues to be an attractive destination for private equity,( )
Jorge Gonzalez CEO City National Bank
What makes Broward a good area for City National Bank to grow in? Broward County is a natural growth market for City National Bank. We have been in the market for some time and have steadily grown our business there. Broward is one of the most attractive business locations in the country, and as a private commercial bank, that makes it attractive to us, too. Miami-Dade County has a lot more density, but we’re seeing a lot of real estate development in Broward. Investors can see that there’s less and less land available in Miami, so Broward and Palm Beach are the natural next step. That’s partly why these two markets are seeing new growth, and in many cases we’re following our clients north. There’s a lot of wealth in Broward, so the private banking sector will be important for our business. There are also many small and medium-sized businesses, so we’ll cater to that group as well. We would love to triple our market share in Broward in the next five years. How is technology changing banking? Today, we have so much more information at our fingertips. We have the opportunity to become much more knowledgeable about our clients and their needs and behaviors. The key is to use that information to be more tailored and targeted in creating a value proposition that is meaningful because it is based on our clients’ needs. We’re using information and technology to bridge the gap and create more connectivity, too. While there are fewer people walking into banks, there’s much more outreach from the bank. As wonderful as technology is, clients still like talking to real people. That’s where we have the best of both worlds. We still have the flexibility of automated services, but we have plenty of people to help when clients need a human touch. Technology also brings with it some issues. Cybersecurity is one of the most critical areas of risk management for all industries, and especially banks. We have been making large investments in this area and working to help our clients protect themselves as well. www.capitalanalyticsassociates.com
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Market voices: Small Business
Cressman Bronson Regional President PNC Bank
Small and medium-sized companies are thriving in Broward. These companies have found the benefits of growing in a region with a businessfriendly, low-tax environment. According to PNC’s Small Business Survey, 84 percent of respondents feel optimistic about the business climate during the next six months. That optimism is creating energy and activity in Broward. Broward County is the perfect place to start, grow and diversify your business. It has everything a business owner, foreign or domestic, could want: a multilingual population, access to good airports and a vibrant economy with a diverse, skilled workforce and strong educational system. It also has a cultural community of artists, musicians, restaurants and museums that makes this one of the best places to live and work.
Small business lending is the bread and butter of business for BB&T. We define and segment businesses by revenue size. Businesses up to $2 million in revenue are classified as Small Business Banking. Those businesses with revenues of $2 million to $100 million segment to our Commercial Banking division, and anything beyond that would fall within our Corporate Banking Group. Small businesses, as defined by BB&T, are mostly closely held by one or two family members, they usually don’t have a CFO, their financials are typically based on tax returns versus account-prepared statements and the business owners make all of the decisions. As they grow, they will begin to employ skilled staff such as CFOs and COOs, and the accounting will become more sophisticated.
Shawn Sackman
Fort Lauderdale Market President SunTrust Bank
Iwan Mohamed
SVP, Market President BB&T
Specifically in Broward County, our business is driven predominately by companies that are under $25 million in revenue, so there’s definitely a need to focus on small business. That market is overlooked by the banking industry from our perspective. Community banks focus on these businesses, but the regional and national banks don’t. Ultimately, these companies that are $10 and $25 million will eventually be the $100 million companies. It’s a great time to be part of a small business. The ones that emerged from the recession in 2008 have rebounded and are on a great trajectory for smart growth. For smaller businesses, there are several hurdles that entrepreneurs need to navigate early on. They may not have the proper processes in place to make their businesses scalable or sustainable.
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BANKING & FINANCE OVERVIEW
( ) especially in the wake of December 2017’s sweeping federal tax overhaul. The Florida Growth Fund, an economic development tool that invests money from the Florida Retirement System, has created nearly 17,000 jobs in the nine years it has been in operation. According to a report from the Florida legislature’s Office of Program Policy Analysis and Government Accountability released in early 2018, the growth companies and PE firms backed by the fund have made $545.9 million in total capital expenditures statewide. South Florida has seen $279.4 million in investment, with $56.1 million in Broward County. Following Hurricane Irma in September 2017, the U.S. Small Business Association (SBA) announced its approval of more than $5 million in low-interest disaster loans for Florida businesses and residents affected by the storm. In late January 2018, the SBA closed all disaster loan outreach centers. However, at the time of print, the agency was still accepting applications for Economic Injury Disaster Loans (EIDLs) designed to help meet working capital needs caused by the disaster. These loans are available regardless of whether the business suffered any physical property damage in the storm. Cost of sunshine Of the 10 most devastating hurricanes to make landfall in the U.S. to date, six hit Florida, but powerful storms aren’t the only natural disaster the state has to contend with. In 2016, Florida ranked sixth in the nation for wildfires and seventh for tornadoes, so it’s no surprise the Sunshine State has some of the highest insurance rates in the country. According to the National Association of Insurance Commissioners, Florida homeowners with H03 policies pay an average of $1,993 annually, compared to the national average of $1,173. One issue facing Florida insurance companies is the recent assignment-of-benefits (AOB) crisis. AOBs allow policyholders to sign over contractual benefits to a vendor, who then files claims directly with the insurance provider for work performed. In recent years, some unscrupulous water-extraction companies and contractors have uncovered ways to exploit loopholes in state law to file increasing numbers of AOB lawsuits. According to the Department of Financial Services, 28,000 AOB lawsuits were filed in 2016, compared to just 405 a decade earlier. As a result of these increased AOB claims, in 2017 a number of private insurance companies with large South Florida market share — including Heritage Property & Casualty, People’s Trust, SafePoint and
A new generation of customers is driving demand for fast, easy and reliable financial services.
Universal — raised their rates by 9.9 percent or more. Many are also taking steps to reduce their exposure by canceling or declining to renew existing policies or choosing not to write new policies for homes in high-risk territories for claims fraud. In June 2018, state-owned Citizens Property Insurance announced proposed rate hikes of 9.9 percent for multi-peril coverage (wind plus all other risks) for Broward County’s 27,262 policyholders and 8.6 percent for the county’s 6,910 wind-only customers. The company cited increased water damage claims as the reason for the hikes. If approved by the Florida Office of Insurance Regulation in the fall of 2018, the new rates would take effect in 2019. South Florida residents were also hit in 2018 with higher auto insurance rates. According to the U.S. Department of Labor, rates were up an average 8.5 percent nationwide over the year ending in January 2018 and 7.5 percent the previous year. For South Florida residents, who already pay among the highest rates in the country, that news is particularly unsettling. Industry experts are blaming increased risks on the road ( ) www.capitalanalyticsassociates.com
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®
oundtable: Tax Reform
In December 2017, the Trump administration passed one of the largest reductions of corporate tax rates in U.S. history. The Tax Cuts and Jobs Act affects most taxpayers, but the most pressing question for many Broward residents and business owners is: How?
David Appel
Managing Partner Cherry Bekaert LLP, South Florida
How will the new tax legislation affect individuals in Florida? Almost every tax bracket is going to be favorably impacted by the tax bill. However, there will be particular groups that might see their taxes rise. For example, reductions to the amount of taxes (real estate and income taxes) that can be claimed as itemized deductions will negatively affect those who live in the Northeast or other states with high state income tax rates. These individuals might see their tax bills rise due to the loss of certain types of deductions just mentioned and others that they previously were allowed to claim. In Florida, we don’t have a personal income tax, so it’s not going to affect us that much. The rate reductions are going to help, which ultimately puts more cash in our pockets How will the tax legislation affect startups in South Florida? For startups, it’s about structuring operations from formation and determining what changes need to be made to those existing entities. If a startup isn’t going to be a pass-through (where the tax is borne by the owners and not the business entity), it will be a C-corporation. Many new companies lose money in the initial years before they become profitable. Therefore, the type of entity they select to be taxed as at their inception is not always an easy decision. In 2017, the maximum federal tax rate for C-corps was 35 percent. Under the new law, the federal corporate rate is now reduced to 21 percent. That’s a big difference. For some of these companies, it’s a decision based on which rate will serve them better. 124 | Invest: Greater Fort Lauderdale 2019
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Teri Kaye
Partner-in-Charge, Sunrise Office Daszkal Bolton LLP
How should a business make informed decisions based on the new tax legislation? We’re working with our clients to help them understand what parts of the new tax law will benefit them and what parts will be detrimental. This first step is about getting information. The second part is finding out what steps are actionable, and the third is deciding whether or not to take those actions. In some cases, all we have are nonactionable items. Personal state and local income taxes, real estate taxes and sales tax are limited to a combined $10,000. There’s not an actionable step there for someone paying more than $10,000 for those taxes each year; they simply lose the excess deduction. For pass-through companies subject to multi-state taxation for which the business owner has income tax filings in multiple states, they’re losing those tax deductions. Some will have actionable items, like converting their pass-through to a C-corp, and it is our place to inform them and then help them make the right decisions so they can change how they are doing business and adapt to the new system. What impact will the South Dakota v. Wayfair, Inc. Supreme Court case have on intrastate commerce? Every company that is shipping goods outside of Florida, whether at retail or wholesale, should be computing their sales per state and the number of transactions into each state. States have already enacted or are passing new legislation to impose sales tax and reporting requirements on out-of-state sellers. There are major initiatives by many states to go after companies and not just the big players. Currently, every state has its own rules and its own thresholds.
BANKING & FINANCE ROUNDTABLE
Adam Spiegel
Managing Principal MBAF
What do we still not know about the new tax legislation? The tax code has historically been changed to stimulate the economy, which is what this tax legislation was designed to do. It was also intended to equalize the playing field in a global marketplace. The changes were advertised as very beneficial, but the results are likely to be mixed. It doesn’t feel like most understand the whole picture yet, as the IRS regulations that explain the new policies still had not been issued in late September. This has made 2018 a difficult year for us to provide tax planning services. I think the qualified business income (QBI) deduction, IRC Section 199A, could be as high as 20 percent net income for certain industries and types of entities. This will help stimulate growth, but like in everything, it will have trade-offs. Whether margins will be higher or lower will vary industry by industry, due to things such as tariffs, low unemployment and high cost of goods sold. But it seems likely that the margins of the service, manufacturing and trade industries will shrink. What effect will this legislation have on the real estate industry? Residential real estate is booming here in Broward, but that trend might slow with the reduction of the real estate tax deduction for a primary residence. In our marketplace, it’s very easy to find a home valued at $500,000 or more. Most people with a home of that value will pay $10,000 or more annually in real estate taxes. Those people will have a maximum deduction from their real estate taxes, resulting in a potential lull in that industry as people shy away from paying higher taxes.
James Sanderson Tax Principal KPMG
What have been the major changes of the tax reform? The new tax act changed the anti-deferral rules. Companies structured themselves to earn less money here in the U.S. and more overseas. They often chose not to bring back overseas earnings to the U.S. to avoid the higher taxes. Over the course of my career, the U.S. became the highest-tax jurisdiction in the world because other countries like Germany and Japan dropped their rates to attract business. We were all around 35 percent, but now, for example, the U.K. is somewhere in between 18 and 19 percent. Jurisdictions have been dropping their rates. Because of that rate disparity, companies were finding ways to earn money offshore, partly due to cheaper labor abroad, but also because of the very high tax rate here. The tax act changed that. The corporate rate went from 35 to 21, which is a huge difference. How will the changes affect repatriation of foreign capital to the U.S.? About a decade ago, there was an optional repatriation. The IRS and treasury offered companies a 5 percent tax rate to bring money back into the U.S. Some did take advantage of this, but most of them just distributed it to shareholders. Why? Creating jobs or buying assets in the U.S. would make that money vulnerable to the 35 percent rate, so it wasn’t worth it. When you read into the details of the new legislation you’ll find a mandatory repatriation clause that requires U.S. companies to bring back all foreign deferred earnings. The downside of these rules is companies pay U.S. tax on these deferred earnings, but the upside is U.S. companies will be able to access overseas cash more easily. www.capitalanalyticsassociates.com
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( ) — including more congestion and distracted driving — for these higher prices. The sharpest increases in the tri-county area are coming from Safeco (12.2 percent), Nationwide (8.2 percent) and Hartford Insurance Company of the Southeast (7 percent). Still, many would say contending with higher insurance premiums is a small price to pay to live in such a beautiful and booming part of the country. The robust insurance industry is what keeps that boom alive.
D. Nicholas Miceli Regional President, Florida Metro TD Bank
What has been the effect of rising interest rates on TD Bank’s business in South Florida? Residential mortgage rates have begun to rise, which has led to a reduction in residential refinance opportunities. Rates, however, are still relatively low, so mortgages for new home purchases are still strong. As it relates to commercial lending, rates are still relatively low, and confidence remains quite high. This confidence, coupled with a relatively low rate environment, continues to drive expansion and growth. How is TD Bank supporting small businesses? Small business banking is something that’s very important to us, and there is strong competition among banks for these clients. We believe that our strength is in our model, which is based on service and convenience. We couple this with knowledgeable team members who are empowered to make decisions locally. Understanding our clients’ needs allows us to earn their trust and loyalty. We also recognize that some small businesses may not know how to approach a bank for a loan. We regularly conduct seminars for these business owners and provide them with the tools needed to best position their company to get a loan approved. It is important to establish a good banking relationship. We encourage companies to establish relationships with their bankers during good times so that they are available when they need them during downturns. We also stress the importance of regular communication. This allows us to really get to know our customers and respond quickly with solutions. We have an approach that is different from most other banks. We deliver retail stores, commercial lending, small business lending and wealth management all in one team approach. It’s our culture to deliver one bank to all of our customers and prospects in Broward County. 126 | Invest: Greater Fort Lauderdale 2019
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Adaptability The U.S. Treasury Department recently cited cyber attacks as one of the greatest risks to the country’s financial sector, with more than $445 billion lost in 2017. As one of the world’s fastest-growing and highest-paying industries, cybercrime is redefining the nature of security for banks and other payment companies. For many South Florida financial leaders, cybersecurity has become a top priority. “Banking is facing some pretty dramatic challenges due to changing technology,” Kevin Costello, CEO of First GREEN Bank, told Invest:. “While we use a system that was developed in the 1940s, countries like China and India created their banking systems later, so those countries now have a more modern system than the U.S.” Regulatory uncertainty and consolidation are also at the forefront of bankers’ minds, both in Broward and across the nation. But as 2019 approaches and we look toward a bright financial future, there are other important challenges afoot. Talent management is becoming critical, particularly for community banks, whose staffs need to be up-to-date and in tune with risk and management strategies. As technology continues to evolve, it becomes crucial for institutions to be able to identify risks before they become priorities. Banks will need to spend both time and money on proper training. While the economic boost promised by May 2018’s Dodd-Frank rollbacks is a positive thing, it will also likely bring an expansion of financial services, shining a light on the process, quality and development of new products. It will become increasingly important to ensure that proper infrastructure is in place to control risk. The financial industry’s reliance on third parties is also poised to become a bigger challenge, as are the intricacies of catering to a restive customer base that wants what it wants and wants it now. But perhaps most importantly, automation continues to accelerate change in the industry’s workforce. In addition to permanent employ-
BANKING & FINANCE OVERVIEW
ees and contractors, we will start to see more freelancers juggling multiple banks, fintech innovators and even robots working alongside humans. Banks will need to put extra effort into preserving day-to-day continuity in their business. Traditional work environments are starting to shift toward more collaboration and inclusivity, with a focus on work-life balance. Bank employees will need to be digitally enabled and customer-oriented to provide a richer experience to consumers. And with increased competition from Broward’s booming tech industry, the region’s banks will need to put more focus on attracting, training and retaining proper talent. Bright future According to the FDIC, 70 percent of the U.S.’s 5,606 banks grew their bottom lines during Q1 2018, while the percentage of money-losing banks dropped to 3.9 percent. The FDIC’s list of problem banks — or those at risk of failure — fell to 92, the lowest number since Q1 2008. In Florida, the state’s 127 banks earned a combined $510 million in Q1 2018, up $97 million from Q1 2017. A total of 12 Florida banks, or 10 percent, lost money in the first quarter. While the
FDIC cites the tax cuts for boosting bank earnings by about $6.7 billion, primarily among the largest banks, even without the sweeping reform banks would have seen about $49.4 billion in profits. December’s tax reform has made an already strong banking industry even stronger. Today U.S. bank capital levels stand at nearly $2 trillion, putting financial institutions in a solid position to increase lending to meet future demand. Banks are prepared to offer more financing as businesses start to capitalize on the incentives and opportunities created by the new tax laws. “The national tax reform is incredibly positive for Florida,” James Donnelly, founder and CEO of Castle Group, told Invest:. “We don’t have any state income tax. Until the federal tax reform, if someone lived in a high tax state, they were allowed to deduct the state tax from their federal income tax. That wasn’t really fair because the rest of the country was subsidizing those states. Florida has always had a tax advantage, but now it’s even better.” With the recent tax cuts, regulatory reform and continued advancements in technology, Broward’s banking and finance sector is poised for positive growth for many years to come.
Market voices: Security BANKING & FINANCE OVERVIEW
Jim Ray
City President, South Florida Fifth Third Bank
We helped to pioneer a process called CPS (currency processing solution), which allows companies to take onsite cash and transport it to a safe location. If you own business that takes in a lot of cash, there’s a lot of risk that goes along with that. By going from a vault to an armored transport, that mitigates some of that risk. We helped to innovate this model with an integrated solution. We manage the currency processing piece, as well as the relationship with the armored carrier, which streamlines the process. Technology continues to advance at a hyper pace, and Fifth Third is always looking for ways to innovate.
Security is not our largest business, but it is certainly one of our more important businesses. Obviously, with all the cyberattacks that are going on, our job is to protect our clients from attacks that are being aimed at them. Typically attacks come from a few general sources. There are the political activists, extortionists and nation states attacking another country at their top-secret level. We stop all of that nastiness out there to protect our customers. Aside from all the tremendous technology that we have, a lot of times it comes down to an individual’s skill to visually pick out the attack and write a crafted mitigation for it. You could stop an attack by unplugging your computer, but you have to let in the good and stop only the bad.
Mark Agulnik
Partner IT Risk and Assurance Marcum LLP
Senior Director of Global Security Operations Akamai
We have large companies that we conduct cybersecurity tests for, but we are focusing on small to medium-sized clients as well. We have created a more cost-effective program for these companies to help test their security and determine if there are vulnerabilities. We can create simulated phishing attacks and try to obtain data from employees. We can ask for information and see if we can get credentials from employees. The results of our testing can lead to more security training and the implementation of more robust policies to protect confidential data.
Remote deposit capture and online banking have been around, but now there are a lot more applications. It’s more secure to do your wires online than to go into a brick and mortar location. Pretty soon you’ll be able to approve wires and ACH transactions on your cell phone. Customer demand is pushing everything that way, and those institutions that are most responsive in this regard are likely to be the winners. Our first task is to build a wall around our information and keep it safe from attempted breaches. However, fraud cases often involve our customers getting hacked, so people are accessing an institution’s system through its customers. We spend a lot of time teaching customers how to protect their information and prevent fraud. 128 | Invest: Greater Fort Lauderdale 2019
Roger Barranco
| BANKING & FINANCE
Chuck Cross
Executive Vice President and Commercial Banking Executive Seacoast Bank
Education: With growth spanning all industries and a tight job market, it’s imperative for the educational systems in Broward County to be functioning at a high level. Fortunately, as one of the largest districts in the country and the second largest in Florida, Broward is large enough to accommodate an expanding future workforce. With this kind of size, the district is also a great job creator. Job growth in the education sector was up nearly 3 percent year-over-year.
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Solid foundation: Broward County’s educational institutions are adapting to a growing population and remain focused on preparing the future workforce Broward County Schools boasts the sixth-largest district in the U.S. and the second largest in the state of Florida, just behind Miami-Dade. With a number of regionally accredited colleges and universities, as well as an array of adult education providers, the headquarters of Kaplan Higher Education, local charter and private schools and one of the largest public library systems in the country, Broward is well equipped to train and polish its future workforce. With all of the growth taking place in the county, the area’s educational institutions are expanding and adapting as well. As of July 2018, Broward County had gained 3,100 jobs year-over-year in the education and health services industries — a 2.8 percent change — with a gain of 1,000 jobs from June to July 2018 alone. Just under 90 percent of Broward’s adult residents have obtained at least a GED, and 31 percent hold a bachelor’s degree or higher based on data from 2017. Broward’s dropout rate in 2017 was at 12 percent, compared to Miami-Dade’s rate of 19 percent. Big picture In its annual ranking of states, the U.S. News & World Report awarded Florida the number seven spot when 130 | Invest: Greater Fort Lauderdale 2019
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it came to education, but that number erases some nuance. While the Sunshine State came in at number one for higher ed, K-12 was much lower, ranking number 40. Florida scored number two in the nation for low tuition and fees, as well as associate degree graduation rates. On the other end of the spectrum, the state ranked 43rd for on-time graduation from high school. That being said, Florida’s graduation rate in 2017 was the highest since 2004, at 82 percent, indicating that progress is being made. While a good education is considered a positive thing by most everyone in the U.S., student debt is casting a growing shadow, causing issues for college graduates and making potential students shy away from the high costs of postsecondary education. The debt generated by student loans in the U.S. is greater than both credit card and auto loan debt and is second only to mortgage debt. Today, over 44 million American borrowers owe $1.5 trillion in student debt. At $4,480 per student, Florida comes in under the national average of $4,920. In 2013, there were 19 million students enrolled in higher ed programs nationwide. By the spring of 2018, that number had declined to just under 18 ( )
EDUCATION INTERVIEW
Collaboration How Broward County Public Schools is promoting a spirit of collaboration to provide students with accessible, innovative programs and safe spaces to learn
Robert Runcie Superintendent of Schools – Broward County Public Schools Why are soft skills so important for students, and how are you emphasizing them? Our innovative programs include our computer science program, which is one of the largest in the country, and our speech and debate program, which is the largest in the world. This year, approximately 13,000 students are participating. Speech and debate is offered at all middle and high schools and has expanded in elementary schools to 35 additional schools this year, for a total of 73 elementary schools. Businesses want employees who are able to think critically, who can look at information, decipher facts, be able to develop and defend opinions and be able to communicate those thoughts. All of those skills are part of what speech and debate are all about, and it transcends disciplines. Who would not want an employee who is able to comment on and articulate what they’ve analyzed? That is ultimately where our students need to be at the end of their academic careers in Broward County Public Schools. We strive to ensure that programs like these are accessible to all of our students, no matter what their career goals and aspirations. We do not know what jobs are going to be most popular when our students graduate, so we focus on those skills that are required and desired for just about every job or profession that’s out there. Critical thinking, the ability to communicate effectively and proficiency with technological tools and resources are always going to be important. Overall, we seek a greater level of alignment and collaboration between the business community and the school system so that we’re able to give students internships and experiences to careers that are out there. What are the best ways to honor the victims and survivors of the Marjory Stoneman Douglas attack? Together with district leadership, I work as much as I can with the families in the community to get those ide-
as directly from them, and then collectively we do our best to deliver on them. I think one of the first things to do is to listen to, respect and honor the families of the victims, as well as the survivors who were injured, and make sure that we’re supporting them as much as possible. We work to find out what needs and ideas they have so we can do our very best to deliver on those. The second thing that we need to do is a complete, comprehensive investigation of this horrific tragedy so that we can find what we need to change and fix within the district in order to significantly minimize the possibility of this ever occurring again at a school. I realize there’s a lot of anger, hurt and frustration, but as a community we have to figure out how we can work together with a spirit of collaboration, respect, compassion and love to get our community to the next level. www.capitalanalyticsassociates.com
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EDUCATION OVERVIEW
( ) million — a 7 percent decrease. A declining birth rate, coupled with a decline in foreign students choosing to obtain their education in the States, is putting stress on the problem. Higher minds Broward College has over 60,000 students, and almost 50 percent are the first generation in their families to attend college. The school awards about 10 times more associate’s degrees than bachelor’s degrees and offers popular programs in health sciences. Its faculty, staff and programs result in a total economic impact of about $1 billion, accounting for 1.5 percent of the total regional economy and about 23,340 average-wage jobs. The college’s president for the last decade, J. David Armstrong Jr., announced his retirement in December 2017. Greg Adam Haile, the college’s general counsel and vice president for public policy for over five years, was tapped to take on the position. He assumed the presidency in July 2018. Nova Southeastern University (NSU), one of the largest private employers in South Florida, was ranked 191st nationwide by U.S. News and World Report’s Best Colleges in September 2018. Ground broke on a new campus in Clearwater in March 2018, and the Commission on Osteopathic College Accreditation approved the school’s program. In the summer of 2019, the campus will be open and ready to welcome 150 osteopathic medicine students. The school boasts an Oceanographic Center with many marine and oceanic studies programs. Experts from the schools are helping local conservation groups slow the destructive coral disease harming reefs throughout South Florida. NSU has an estimated economic impact of about $3.2 billion on the state of Florida.
Broward County offers many options for higher learning, including NSU, one of Florida’s largest private employers.
Mason Jackson President & CEO – CareerSource Broward
No one is going to offshore plumbing or air-conditioning jobs. Our challenge is to get the community to value jobs that require a technical education as much as jobs that require a bachelor’s degree. The narrative in this country is that if you aren’t college material, you take this lesser, technical route, which will mean you make less money. That’s not the case. It’s not a step down; it’s just a different path, often with less debt and higher wages. Middle-skill jobs are growing faster than jobs requiring only a bachelor’s degree.
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CONSTRUCTION ECONOMY OVERVIEW
George Hanbury II President & CEO Nova Southeastern University
Can you tell us about some of the innovative research happening at NSU? At NSU’s Halmos College of Natural Sciences and Oceanography, we’re looking into how we can take what our research scientists are learning from marine biology and seeing if it has human genomic applications. One area we’ve talked about is exploring any similarities between how corals regenerate and applying that to human bone regeneration. It’s a field that’s wide open. At the Center for Collaborative Research, located on our Fort Lauderdale campus, we have researchers studying tissue regeneration. They’re interested in finding ways to make therapeutic cells more efficient in the future. We’re also continuing research on stem cells and opioid addiction. NSU’s research efforts are collaborative, involving students and faculty in multiple disciplines. As a research university, it’s important that all of our students, including undergraduates, be engaged in research from day one.
While Florida Atlantic University (FAU) is based in Palm Beach, three of the university’s five campuses are located in Broward County. The Fort Lauderdale, Davie and Dania Beach campuses make up about 11 percent of the school’s total students. However, the school’s online and distance programs contribute around 22 percent, reflecting a growing demand for flexible and online education. The most popular undergraduate programs are business, biological sciences and psychology. This year, the university was granted over $80,000 by the U.S. Department of Education to help offset the cost of educating students from Puerto Rico and the Virgin Islands who were displaced from their homes by 2017’s hurricane season. FAU reported an economic impact ( )
How have the programs you offer evolved over the past few years? Over the last few years, as interest in business and education programs have declined, we’ve seen an increase in demand for healthcare-related disciplines. In response, we’ve expanded our program offerings in life and health sciences, including occupational therapy, physical therapy, anesthesiology assistant and physician assistant programs. We’ve also seen extraordinary growth in our nursing programs. Not that many years ago, we didn’t even have a nursing program. Now, NSU is home to the largest nursing college in the state of Florida. Our students get more clinical hours and work with the latest technology. As graduates, they are highly sought after. We have one of the lowest default rates in the nation on federally subsidized student loans — it’s around 3 percent. This means that 97 percent of our graduates have gainful employment in their disciplines and are able to repay their loans. www.capitalanalyticsassociates.com
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EDUCATION INTERVIEW
Equalizing education How Broward College is working to provide educational opportunities to challenged communities and students from all walks of life
Gregory Adam Haile President – Broward College top quartile is about 80 percent. The bottom quartile of income earners increased marginally to 9 percent. So there’s a problem there. Most economists agree that it is economically beneficial to obtainin a quality higher education that leads to a meaningful career. So until we connect all communities to opportunities of going to college, it’s going to be difficult to see changes happening with employment and income in those communities. Broward College has to play some role in changing that dynamic. We’re looking to establish a presence in those challenged communities that need us. We have to have conversations with political and business leadership in those communities, as well as organizations that are already doing good work. We have 63,000 students at this institution, but there are many students who don’t come to us or don’t know how to benefit from Broward College’s ability to transform their lives. We have to figure out a way to make a difference to those Broward County residents.
How can Broward College play a role in equalizing opportunity throughout Broward County? I’ve worked in Broward County since 2004, and the 3.2 percent unemployment rate is absolutely incredible. I love where we are as a county. I think one of the realities that we will have to pay attention to are those pockets where there are still opportunities for growth. In at least one community, only 18 percent of the resident have post-high school educations, and the unemployment rate is approximately 14 percent. That means that while we are doing extraordinarily well, we still have communities that are not benefiting from the robust economy. About 50 years ago, the college-going rate for the bottom quartile of income earners in this country was 6 percent. The college-going rate for the top quartile of income earners was 45 percent. Fast-forward to today, and the 134 | Invest: Greater Fort Lauderdale 2019
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How important are online education opportunities for Broward College? We have counter-cyclical enrollment to the economy. When the economy is going well, enrollment tends to flatten or decline. With the economy doing so well, we are down 6 percent in terms of student enrollment in brick-and-mortar classes as compared to last year. However, year-over-year for the last five years, we’ve seen increased enrollment in fully online and blended class offerings. We know that trend will continue. Online classes bring down the indirect cost of education by eliminating the need for transportation. A significant portion of our student population works full time and leads families. We are seeing online growth around older adults who are looking for flexibility and want to log in to get their work done in the evening or the middle of the night, whenever they have time.
EDUCATION OVERVIEW
( ) of over $525 million on the region in 2017, and the university was award 16 patents in the same year. Keiser University has 21 campuses throughout Florida, making it the state’s second-largest nonprofit university, including three in Broward County. The school was named the third-best online university in the U.S., and nearly 25 percent of its student body comprises active duty service members, veterans or military family members. Keiser’s annual economic impact on the state is $3 billion and results in 30,000 direct and indirect jobs. Another option for those looking for a degree is DeVry University. DeVry has campuses across the nation, with a local option in Miramar, and offers programs in healthcare administration, business, technology and media arts. K-12 Broward County Public Schools (BCPS) have had some news to celebrate in 2018. Their standardized test scores in both English and math rose by 1 percent, beating out the statewide averages of 654 and 60 percent, respectively. The school system was also awarded a B grade by the Florida Department of Education for the fifth year in a row. BCPS only missed the A designation by two points, which bodes well for 2019. As George Platt, partner at LSN Partners, LLC, told Invest:, “Under Runcie, we’ve made great strides with the quality of our public education system. It’s the sixth-largest district in the country and the largest employer in the county with transportation, maintenance, food service and technology programs.” In August 2018, Broward voters passed an increase in property taxes — about 50 cents for every $1,000 in assessed property value — to support more funding for BCPS. The estimated $93 million per year will go mostly towards increasing salaries for teachers. Salaries are expected to rise about 6 percent, which might attract higher-quality educators to Broward County. Tax dollars will also be used to supplement security and student support services. The district serves over 270,000 students, and 16 of its high schools were ranked in the U.S. News & World Report’s 2018 list of best high schools nationwide. Pompano Beach High School and Cypress Bay High School earned gold rankings, reflecting their students’ college and career readiness. Tim Lonergan, mayor of the City of Oakland Park and president of the Broward League of Cities, was understandably proud of the school’s achievement. “Over the years, much of the school board’s emphasis has been on the expanding school system out in
Dan Lindblade President & CEO Greater Fort Lauderdale Chamber of Commerce
For whatever reason, the value of the trades in our country has been diminished over the years. We are focused on increasing the number of students who realize that trades are a viable — and sometimes more viable — option for them, compared to earning a college degree. Right now, we’re building a county-wide program to engage more young people in the trades. It will be a multifaceted partnership with Broward College, our technical colleges, CareerSource, the county government and the Broward County Public Schools Superintendent Robert Runcie and his team. The program will receive state and federal funding, and all of these players and resources will converge on specific strategic thrusts in this forum. We have been offering mentoring programs, internships and externships, but now we really need to build a viable structure that can convey a powerful message to families. If the chamber president is coming in and telling you that a trade career is something to be proud of, pays well and doesn’t come with a large amount of student debt, we will convince more young people. Why not go out and make well over a living wage at these jobs? Many make upwards of six figures relatively quickly after getting a few years of experience. We can’t create all these pathways to learning and to achievement and not have jobs at the other end. We are excited to forge partnerships with local companies to provide an easy pathway for our newly educated students, and the outlook for those jobs is good. Our council of economic advisors met earlier this summer, and their forecast shows another two years of this labor demand, major hurricanes or economic meltdowns notwithstanding. With the need for labor so high, we are hoping that this program isn’t too little, too late. Whatever we design and build will be scalable, so we can scale it up to accommodate more interest. www.capitalanalyticsassociates.com
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Jonathan Hage President & CEO Charter Schools USA
What separates charter schools from private or public schools? There are a lot of people who think charter schools are private schools, but they’re not. They are privately run public schools that can’t charge tuition and have open enrollment. If we get more applicants than seats, we use a lottery system to fill them. One of the advantages of a charter school education is our students and parents choose to attend. That’s a big difference between charter and public schools, where students go to the school they’re assigned by their address. There are a lot of reasons parents might choose an alternative option. Sometimes, a child isn’t doing well in a traditional public school and wants a specialized program. We can customize the curriculum for that child to help him or her succeed. Charter schools have to perform well and offer a different style of education or they will go out of business. They are much more tied to the marketplace of performance, just like a business. If a business is not producing a better product or service, it might not make it. Charter schools don’t get a guarantee that 500 kids will sign up. They have to come because they want to come. If the school starts failing its kids, they’ll leave, and the school could go out of business. How are you using technology to improve learning? We don’t see technology as something that should be turned off and pushed away. We are integrating it more and more into the school day. One of the biggest changes coming up for us is personal learning plans designed for every child. Technology is a part of that because we allow parents to see what the child is learning and how she is doing on a constant basis. We’re also moving towards the use of artificial intelligence to support the individualization of each student’s education. We’ve had this one-size-fits-all model for so long. Technology is now informing us on how to individualize that and allows our teachers to do more than deliver education in one format that each child will interpret differently. 136 | Invest: Greater Fort Lauderdale 2019
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the western suburbs,” he told Invest:. “The eastern schools were not as attended to as they needed to be. We were very happy back in 2014 due the $800 million school board bond. Our schools are now receiving some of those really important updates.” Pembroke Pines Elementary was named as a Microsoft Showcase School, one of only five statewide. The school was commended for its integration of technology and will work with Microsoft to expand education through adapting technology. A controversial new program was enacted by the Florida state legislature in 2018 that grants bullied students vouchers to attend private school. The program has been criticized for taking students out of public schools, as well as for dealing with the symptom of the problem (the bullied children) and not the root cause (the bullies themselves). Regardless, more students could be attending private school in Florida thanks to this new legislation. American Heritage School, based in Plantation, had 70 National Merit semifinalists in the spring of 2018, making the school the nationwide private school leader in number of semifinalists. The school has led Florida in the rankings for the past nine years. Pine Crest School updated its facilities with a new performance training facility for student athletes. The Brandon Knight Sports Performance Center, named for donor, alumni and NBA player Brandon Knight, opened its doors in September 2018. Charter schools are also an option for students in Broward County. Charters are public schools that are independently operated and often offer specialized curriculum to attract particular students. Some are nonprofit and others are for-profit institutions. Jonathan Hage, leader of Charter School USA, one of the nation’s largest charter school organization, was named as one of the 500 most influential business leaders by Florida Trend in 2018. Charter schools are often criticized for pulling funds from public schools. In February 2018, Broward County Public Schools, along with several other districts statewide, were commanded by the state to pay $15 million for construction and maintenance of charter schools in the area. The districts had missed the deadline to distribute the money, as they were challenging the legality of House Bill 7069, which was stalled in the courts. Public, private and charter schools are all options for parents and students in Broward County. Emphasis on trades While student debt continues to rise, skilled trades are requiring more and more labor. With
EDUCATION OVERVIEW
unemployment below 4 percent and construction projects continuing to go up all over the county, skilled craftsmen are in high demand. Despite pay above the median in the region — around $55,000 to $75,000 yearly — 79 percent of construction employers reported difficulty finding the labor they needed in August 2018. Local real estate and construction firms are working to communicate with young people about the highpaying and in-demand jobs that are available to them without an expensive bachelor’s degree. Organizations like Broward College and CareerSource Broward offer grants to employers who are training novice employees to offset the cost of that training. Local institutions available to prospective employees include McFatter, Sheridan and Atlantic Technical Colleges. These schools offer certification programs and apprenticeships that allow students to begin mastering their crafts soon after beginning their programs of study. In 2016, the Marine Industries Association of South Florida began an initiative called Salty Jobs. The program began as a video series offering the younger generation a look at prospective careers in the marine industry. Salty Jobs connects prospective marine professionals to information, programs and job postings. While traditional four-year colleges have long been seen as the easiest path to a career, many in the business world are asking young people to reconsider.
Our Lives one of the largest youth protests since the Vietnam War. Students also took advantage of their summer break to canvass the nation to rally voters and campaign for gun control across 20 states. “The largest issue facing education in Broward County today is safety and security,” Jacquelyn Vernon, regional director at Imagine Schools South Florida Regional Office, told Invest:. “Following the attack at Margaret Stoneman Douglas, we need to make sure an incident like this never happens again at our school or any other. Implementing policies and procedures to increase safety for students is one of the most important responsibilities we have.” With the tragedy at MSD High School, as well as other recent school shootings, more than 50 laws were passed nationwide and locally to try to prevent future mass shootings. In March 2018, Rick Scott signed into law a Florida bill that bans bump stocks, expands background checks and adds a waiting period to buy handguns. Legislation to add funding for more campus police officers in Florida did not pass. President Trump and members of the U.S. Department of Education suggested arming teachers as a precaution, but many decried this idea as more dangerous, especially after a teacher in California accidentally injured a student in a gun safety demonstration in March 2018. Over 15 businesses — including United and Delta Airlines and Avis and Hertz rental car groups — have cut ties with the NRA, an advocacy group that is the face of gun rights in the U.S.
Student leaders organized a protest in Washington, D.C., on March 24, 2018, and at least 1.2 million people marched in solidarity.
MSD Strong On February 14, 2018, the deadliest school shooting since Sandy Hook in 2012 took place in Broward County. 17 were killed and 17 wounded at Marjory Stoneman Douglas High School in Parkland. Since the incident, several students have emerged as nationwide leaders in the gun control movement. The school’s paper released proposed changes to national gun policies, including universal background checks, the ban of semi-automatic weapons and raising the legal age to purchase weapons to 21. The group’s agenda was spread across social and mainstream media. Student leaders organized a protest in Washington, D.C., on March 24, 2018, and at least 1.2 million people across the country marched in solidarity, making the March For
Looking ahead While Broward County’s business climate continues to grow and develop, the county’s educational institutions are working to provide students with the resources and knowledge they need to succeed. Though Broward County was thrust into the center of the school safety debate in 2018, its K-12 and postsecondary institutions are continually improving and adding more technology and program offerings for its students. Challenges moving forward include high student debt and funding for public, as well as private, institutions. All in all, Broward County’s education system is preparing young people and adults for the changing landscape of the region’s employment needs. www.capitalanalyticsassociates.com
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EDUCATION OVERVIEW
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Tourism, Culture & Sports: While it is not uncommon for Broward County to be overshadowed by its neighbor to the south, this year proved once again that the region remains a robust international arts and tourist destination in its own right. The miles of world-class beaches are always the big draw, but Broward County and Greater Fort Lauderdale also offer sumptuous restaurants, luxurious hotels, concert halls and rich historical narratives. Public and private funds continue to be pumped into the tourism sector to sustain the steady growth.
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Unique experiences: Broward County’s tourism industry continues to pack a huge economic punch, offering sun, fun and culture in equal measure Long known as a haven for snowbirds and spring breakers alike, Broward County’s thriving tourism industry has plenty to offer any traveler looking for unique experiences. The industry has a huge impact on the local economy. Broward welcomed 12.8 million visitors in 2017, a 4.3 percent increase over the previous year. This increase is even more significant when accounting for Hurricane Irma, which barreled through South Florida in September 2017 and caused hotel occupancy rates to drop to 42 percent at the lowest point in the storm. Visitors to the area spend an average of about $11 billion, generating a large amount of revenue and 93,800 jobs in the region. Travel trends Broward’s 26 miles of beaches are the region’s bestknown draw for tourists. Local beaches are running into erosion issues, and a plan set for 2021 will invest $50 million of county, state and federal funding into adding sand to beaches in Hollywood, Hallandale Beach and Dania Beach. The latter is considering adding dunes to help secure its beaches from further deterioration. While these plans have been criticized as expensive, the region’s beaches are a huge draw 140 | Invest: Greater Fort Lauderdale 2019
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for tourists and have an approximately $550 million annual impact on the local economy, making the investment necessary. As of May 2018, Brightline connects Fort Lauderdale to West Palm and Miami, offering visitors easy access to all of South Florida. With proposed connections to Orlando and Tampa in the works, Brightline will open up the Greater Fort Lauderdale area to travelers throughout the state. The region is also considering adding a direct connection between Fort Lauderdale-Hollywood International Airport and Port Everglades, which would simplify the travel experience for cruise passengers, giving the port a leg up on its competition. Nationwide, rising jet fuel costs prompted American and Delta Airlines to cut their profit forecasts in the first half of 2018. While newer aircraft take less fuel, ticket costs could rise in late 2018, with the effects spilling into 2019. Significant increases in price could put a damper on Florida’s tourism numbers in 2019. Greater Together In March 2018, the state legislature confirmed Visit Florida’s budget for the 2018-2019 fiscal year at $76 million. The total — a compromise between the
governor’s proposed $100 million and the legislature’s $50 million — was the same amount the department received in the previous year. The statewide tourism initiative launched two programs in August 2018 to aid counties in southwest Florida affected by the red algae bloom. These programs will provide loans and marketing assistance to businesses suffering from the effects of a drop in demand due to the algael issues. While outbreaks occur almost yearly along the Gulf Coast, seeing them spread to the Atlantic side is rare. However, at the time of print, red tide had been confirmed in both Miami-Dade and Palm Beach counties and was “strongly suspected” in Broward. Fortunately, the east coast outbreak is expected to remain moderate. In 2018, the Greater Fort Lauderdale Convention & Visitors Bureau (GFLCVB) launched its newest campaign, Greater Together, which emphasizes the region’s diverse population and welcoming atmosphere. The bureau also partnered with the Cultural Heritage Alliance for Tourism (CHAT) to put on the first Synergy Summit for Cultural and Heritage Tourism in May 2018. CHAT is an affiliation of local businesses that offer tours and experiences based on the cultural history of the region to tourists and locals alike. Excursions in Broward include the Fort Lauderdale Historic Sistruck Gospel Brunch Tour and the Downtown Fort Lauderdale Riverwalk Cultural and Heritage Tour. Travelers are more and more interested in the culture and history of the area, and this partnership allows the GFLCVB to showcase the area’s rich diversity. As Burnadette Norris-Weeks, Esq., partner at Austin Pamies Norris Weeks, LLC, told Invest:, “Cultural tourism has a lot of potential to generate long-term economic development for this area. We have the African-American Research Library and Cultural Center, which is one of only two places like it in the county. There are different exhibits and artists who are featured there, and there are always new exhibits for people to enjoy. Cultural tourism will boost the Sistrunk neighborhood if it is integrated into the neighborhood’s development.” Cultural center The Broward Center for Performing Arts cemented its place as an arts leader in South Florida when it was announced in 2018 that the hit Broadway musical Hamilton would have a five-week run at the theater starting in December 2018, making it the first venue to house the musical in the state. The Broward Center continues to lead the way in
Stacy Ritter President Greater Fort Lauderdale Convention & Visitors Bureau
How have you been working to promote Broward’s burgeoning gastronomy movement? The destination’s new culinary scene is an exciting part of the continuing evolution. We’ve been promoting our culinary assets in earnest for the past two years through various marketing channels, including digital and public relations. People don’t necessarily associate Greater Fort Lauderdale with great dining like they do other areas to our north and south. To get the word out, we’ve created original programming for our digital television network, called Crave GFL, that highlights the diversity of our culinary scene. These videos profile different restaurants in the area, and we promote the series through our social media channels. We also showcase restaurants to make the point that we’ve become a food town. We focus a lot on both well-known and lesser-known areas to concentrate attention on established, new-to-market and hidden gems where locals like to eat. Broward’s restaurant scene is booming with new dining spots seemingly popping up every week. What impact will the new Convention Center hotel have on the region? The hotel will considerably elevate the Convention Center district and create a new environment for conference planners and attendees and a hotel brand that’s new to the destination. It will also allow us to attract business that we haven’t had here before with companies and associations that will only meet in a destination with a Convention Center hotel. Pursuing that market is a top priority. It’s not only the hotel that will improve our convention business, but expansion of the center will also provide us with a facility that will allow us to host larger groups and trade shows than we can currently accommodate. Our industry partners are eager for this to happen, and we’ve heard firsthand from companies such as Informa, a trade show company and new owner of the Fort Lauderdale International Boat Show, that we will be able to capture a significant amount of new business and industries that come with high room nights. www.capitalanalyticsassociates.com 141 www.capitalanalyticsassociates.com|| 141
Joe Cox President & CEO Museum of Discovery and Science
How is the Museum of Discovery and Science continuing to innovate? The museum serves about 450,000 visitors a year, so we are constantly refreshing existing exhibits and installing new ones. We are showcasing the latest and greatest in technology, whether that’s through our AutoNation IMAX Theater or our new exhibits. Thanks to the board and my predecessor, the museum has a solid financial footing, so we’re launching a strategic plan to look at how to position ourselves to reflect where the city, community and region are going to be in the next five years. Our staff is activating some new programming to provide a schedule of special events daily. We’re starting an early childhood program for children under six, the Sprouting STEM Program, with help from PNC Bank. We have our new Ocean Rescue Rangers, which is a partnership with Carnival Cruise Lines where we’re teaching kids about coral reefs. We’re working on a new LGBT+ Inclusivity Initiative with the Community Foundation of Broward and lots of outreach into our community. People are going to see a lot more of us being present in the community. It is an exciting time for the museum and for South Florida. How does the museum help educate young people? If we can get some of the children who visit us to think about small steps they can take every day to curb the effects of climate change, we might be able to change human behavior patterns so the impact is minimized moving forward. We’ve seen so many innovations coming from children, and we want to provide a platform where their voices can be heard. Now that we have these children thinking about science, we need to prepare them for the future. Science museums play a role as a part of the STEM pipeline in workforce development. As large companies relocate to South Florida, they need to have the workforce here to support them. For some of the technical positions we’re filling, we have had to recruit people from outside the area. We want to make sure the children growing up today acquire the skills they need to stay in South Florida and help South Florida flourish. CULTURE & SPORTS Invest: CULTURE & SPORTS 142 | Invest: Greater Fort Lauderdale 2019 | TOURISM, Greater Fort Lauderdale 2019| TOURISM,
arts education, serving more than 130,000 students annually, making its program one of the largest in the U.S. In the 2018-2019 season, the Broward Center is continuing its sensory-friendly productions, offering individuals with sensory processing and autism spectrum disorders a more enjoyable and comfortable theater-going experience, opening up the arts to a wider audience. The BB&T Center offers its 2 million annual visitors more than 200 events each year. In the spring of 2019, acts including Elton John, Fleetwood Mac and P!nk will be available for South Florida residents to enjoy. The BB&T Center is also home to the NHL’s
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Fort Lauderdale is quickly becoming a global mecca for the arts, combining world-class cultural experiences with creative dining options and breathtaking city views.
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Lisa Scott-Founds CEO – Winterfest
Winterfest began in 1971 very organically, with a group of people looking to celebrate the holidays with their community. Tourists didn’t usually begin appearing in the area until January, so Winterfest was an opportunity to bring in people earlier and kick off the tourist season with more of a bang. In 1986, it attracted national attention because of the Bob Hope special. As the economy grew, the participation level rose.
Florida Panthers, who in the 2017-2018 season missed the playoffs by a single point. The team, under the leadership of second-year coach Bob Boughner, is looking to clinch a playoff spot this year. The casinos in the region are also providing entertainment for residents and visitors alike. The Hard Rock Casino and Hotel will host acts like the Beach Boys and Whoopi Goldberg, while it continues to expand its hotel facilities. Isle Casino is in the midst of a major renovation (see more on this in the Pompano Beach chapter), and Gulfstream Park’s turf course is undergoing renovations in preparation for the 2018-2019 championship meet beginning in December. This year, the championship will feature a new race, the $7 million Pegasus World Cup Turf Invitational, and have a record $29 million in purses at stake. FATVillage is quickly becoming the arts center of Fort Lauderdale. The nonprofit arts center has three warehouses for showcasing contemporary art. FATVillage also puts on an Artwalk on the last Saturday of each month, spotlighting local artists, musicians and vendors. The NSU Art Museum in Fort Lauderdale is celebrating its 60th anniversary in 2018 with a special collection, “Remember to React,” which will remain on display through June 2019. The museum has over 7,000 pieces in its permanent collection to delight residents and visitors alike, and kids ages 12 and under are admitted free every day, making the fine arts accessible to children in the area.
Speaking of kids, the Museum of Discovery and Science (MoDS) had several new additions this year. Joseph Cox, who succeeded 30-year president and CEO Kim Cavendish, and a new otter, named Terry in honor of the late Terry Stiles, both joined MoDS in 2018, marking a new era for the museum. The museum hosts permanent and traveling exhibits that are designed to engage children with educational concepts in an entertaining and understandable way. Broward County is full of cultural experiences and institutions ready to entertain and educate.
In 2017, the Fort Lauderdale International Boat Show brought in 105,000 attendees and had an economic impact of over $800 million.
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Boats, planes and concerts In addition to its permanent cultural institutions, Broward also offers a variety of events year round, the largest of which is the Fort Lauderdale International Boat Show (FLIBS). In 2017, this event brought in 105,000 attendees and had an economic impact of over $800 million on the state. FLIBS is the largest in-water boat show in the world and draws attendees from all over the world. As Xavier Etcheberrigaray, hotel manager of the Westin Beach Resort & Spa, told Invest:, “We have the boat show at the end of October, which is a fantastic boon for the hotels here, as well as the entire market. Our renovations will be completed in preparation for that event in our upcoming high season.” The Tortuga Music Festival, which takes place yearly in Fort Lauderdale Beach Park, celebrates rock and country music, and in 2017 it numbered more than 100,000 music lovers in attendance. In
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2019, Jason Aldean, who won the ACM Entertainer of the Year Award in 2016, 2017 and 2018, will be the concert’s headliner. Despite the last-minute dropout of the U.S. Air Force Thunderbirds and substitution of the U.S. Navy’s F/A-18F Super Hornet, tens of thousands came out to enjoy the 2018 Fort Lauderdale Air Show. This yearly event takes place on Fort Lauderdale Beach. Another high-profile event for the region is the Hard Rock Winterfest Boat Parade. One million people come out to watch the boat parade go by, and millions more watch from home. Winterfest is considered the seventh-largest spectator event in the entire U.S. Get a room Broward’s hospitality scene continues to improve. In June 2018, hotels in Broward had higher occupancy growth year-over-year than Palm Beach or MiamiDade counties and also had the highest revenue per available room in the same month, rising 10.1 percent from the year before. Rates for the county’s approximately 31,500 rooms increased by 7 percent compared to the previous year. Throughout the tricounty area, 3,158 rooms totalling 2.1 million square feet will be delivered in 2018, which is almost a 71 percent increase from the previous year, showcasing the rising demand for hospitality properties in the region. In July 2018, the highest beam of the new guitarshaped hotel was put into place at the Seminole Hard Rock Hotel and Casino. The 450-foot-high hotel will have over 600 rooms, doubling the facility’s offerings when the project is completed in 2019 and making the hotel the second largest in the tri-county area. A Four Seasons Hotel and Resort broke ground in April ( )
The 450-foot-high, guitar-shaped hotel at the Seminole Hard Rock Hotel and Casino will have more than 600 rooms when complete.
James Tate President – Tate Capital
The Fort Lauderdale International Boat Show (FLIBS) is the single most important commercial event in Broward County. The show highlights Broward’s marine industry, which has an annual economic impact of $8.8 billion. The FLIBS brings the world to Fort Lauderdale, as well as approximately $850 million of commerce over a five-day period, and the entire Fort Lauderdale community embraces and welcomes the visitors with warmth and gratitude. The FLIBS begins and ends at the Bahia Mar.
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Arts & Culture
The arts and culture sector is a $414.2 million industry in Broward County, and there’s no question that the region has evolved into a true global arts mecca. From galleries and performance space to arts incubators and expanding collections, the Greater Fort Lauderdale area has something for every brand of art afficianado.
Doug CarlosMcCraw Constantini Founder & Owner CEO, FATVillage Banco Itaú International
FATvillage is a community being created in a technology- and arts-rich environment of excellent restaurants, office and residential spaces to live, work, play and stay. The idea is to create a destination location, and our team is focused on making it a unique experience. The FATVillage Arts District Inc. is a 501(c)(3) nonprofit, and we invest more than $300,000 a year on arts and programming, which is a significant expense for us. We are currently building a fundraising component to support our arts program long-term. My experience in FATVillage has taught me that there is a real business bottom line to arts programming. Arts and culture define the soul of a place. Cities like London, Berlin, Paris, Barcelona, Madrid, Rome, Florence, Venice and many other international cities make dramatic investments in the arts, and they reap the benefits. It is short-sighted for a city not to make those investments. We want to be an innovative space. Right now, we have film and sound production facilities, as well as fashion photography. We have incubator space for both arts and tech. We’ve done a lot of arts programming where we’ve combined visual arts with music, dance and opera. If it’s out there, we’re willing to give it a try. ArtWalk is one of our signature events. Every month, except December, we have 2,000 to 4,000 attendees on average, food trucks, music programming and arts exhibitions. It’s a free event, and it attracts a tremendously broad demographic, which shows what happens when you make art accessible for the community.
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Brian P.Norlin Mormile Elaina
Managing Director, Divisional Library Regional Manager Executive, SE Region, African American Research US Trust, Bank of America Library and Cultural Center Private Wealth Management
We have a 5,000-square-foot art gallery and a 300seat auditorium that are constantly in use. We’ve had concerts, plays, fashion shows and talent contests, and our art gallery is constantly booked for different exhibits. We have breakout rooms as well, so we’re available for conferences. One of our missions is to provide that space for the community, so nonprofit organizations can utilize the majority of our facilities for free. Whenever we can, we also provide content. We’ve been dabbling in technology when we can because we want kids to learn about virtual reality, augmented reality and artificial intelligence. Last year, we were able to raise money to bring a virtual reality experience here to the library. We decorated a gallery to look like the Harlem Renaissance, and visitors could put the oculus on, walk down the street and have people talk to them about what it was like during that time. We also had an app alongside the virtual reality piece so visitors could explore what they would see at the library or in a brownstone during that time. Whenever we can incorporate technology, we try to do that. The Greater Fort Lauderdale Visitors and Tourists Bureau has us listed in its top 10 things to do for multicultural experiences. We have a signature program called Destination Fridays where we celebrate different cultures within South Florida. We’re highlighting the rich vibrancy and diversity of South Florida. We allow for all cultures to have a place to celebrate but also for other people to come in and learn about them.
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Bonnie Clearwater Director & Chief Curator NSU Art Museum Fort Lauderdale, Nova Southeastern University
To mark the 60th anniversary of the museum’s founding and the 10th anniversary of the merger with Nova Southeastern University, we are presenting two major exhibitions: “Remember to React,” the first comprehensive show of the museum’s collection, and “William Glackens and Pierre-Auguste Renior.” We house the largest collection of Glackens (1870-1938), who was known as the American Renoir. The exhibition includes paintings from the National Gallery in London; the National Gallery of Art in Washington, D.C.; the Whitney; the Barnes Foundation; and museums and collections in Detroit, Dallas and Baltimore, among others. We organize most of our exhibitions rather than feature traveling exhibitions from other museums, which means we’re contributing to scholarship and culture worldwide. In order for arts institutions to truly thrive, they need financial support. Without big endowments, investments from corporations or support from local governments, we won’t have the ability to really thrive. You can’t have growth without stability. In order to be a true competitor nationally and internationally, we need that financial support, which will take time. Brightline has already made a big impact on us. We are marketing the museum as the central cultural hub of South Florida with a campaign: “Meet Us Halfway.” With Brightline, the museum is now just 30 minutes from West Palm Beach and Downtown Miami. We want to get this strategic location of Broward into people’s minds. With Brightline, South Florida just got smaller.
Kelley Shanley Jeff Haines
President & CEO Regional Managing Director Broward for the SoutheastCenter Florida Performing Wells Fargo Arts Private Bank
The story of the arts in Broward County is that we do more in South Florida with less. We have less philanthropic and government support than our neighbors to the north and south, but we’re reaching more people with the programs we provide on a per-capita basis. We sell more tickets than any theater in Florida and are in the top 10 nationwide in terms of ticket sales. We’re also number one in terms of free education programs. There have been a lot of good decisions made and good people involved in the organization over time. We are building on that past success. Our two greatest accomplishments in the last year are landing Hamilton as the South Florida exclusive and the fact that we continue to make a lot of great new strides in the education space. We are constantly innovating in education and finding new ways to use art as a tool to achieve growth academically and to unlock the potential of students and other people in the community. This year, we’ve been doing a lot of interesting things with organizations like the Pace Center for Girls, where our teaching artists help these children tell their stories through various mediums, enabling them to find their own voice. There are many ways that art can help people, and we keep discovering them at our education center every day. The greatest challenge the Broward Center faces is the one that we give to ourselves. We want to continue to be relevant to our community and find new ways that we can use the Broward Center and the arts to achieve broader goals in the community.
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TOURISM, CULTURE & SPORTS INTERVIEW
Modern cruising How Carnival Corporation is modernizing the cruise industry through clean fuel, innovative terminal renovation and the latest biometric technology
Arnold Donald President & CEO – Carnival Corporation & PLC first ship in the cruise industry to be powered by LNG both in port and on the open sea. This is in addition to several ships that can be powered by LNG while in port. At Carnival Corporation, we have 11 LNG-powered ships scheduled to be delivered by 2025.
What are your reflections on 2018’s market thus far? 2018 is on pace to be another record year for the cruise industry. More than 1 million additional people will take a cruise this year, increasing from 26.7 million in 2017 to 28 million in 2018. In fact, cruising has increased in popularity every year for the past decade, with an overall increase of more than 57 percent since 2009. Cruising is more popular than ever, as more and more people discover that going on a cruise is a great vacation and exceptional value. Also, collectively we continue to further modernize the cruise industry. One example is the adoption of powering our cruise ships with liquefied natural gas (LNG), the world’s cleanest-burning fossil fuel. Our German brand, AIDA Cruises, is leading this development. In late 2018, AIDA will receive AIDAnova, the 148 | Invest: Greater Fort Lauderdale 2019
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How are the ongoing renovations at Port Everglades making the port more cruise friendly? Port Everglades is a major embarkation point for several of our world-leading cruise brands and is the third-busiest cruise port in the world. About 3.7 million passengers will pass through the terminal this year. Many of them will visit Terminal 2, which our Princess Cruises brand recently renovated. For current renovations, the big news is that Port Everglades is significantly extending the length of one of its berths, adding 225 feet to Slip 2. This will serve to accommodate today’s larger cruise ships, each of which offers new innovative amenities. Additionally, just as our Princess Cruises terminal was recently renovated, several other terminals at Port Everglades are currently undergoing thorough renovation and expansion projects. The port is also taking major steps to bring in the latest biometric technology, providing the latest in security screening and improving passenger safety. It’s all part of continued efforts to modernize the entire cruise experience. What are your expectations for demand in 2018-2019? With our focus on consistently exceeding guest expectations across our brands, we are continuing to generate strong advocates and positive word of mouth, which leads to more people considering a cruise for their next vacation. Overall, we’re excited about the future of the company and being able to serve our guests all around the world.
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The total number of cruise passengers traveling through Port Everglades in 2017 was 1 percent higher than in the previous year, and these numbers are only expected to grow.
( ) 2018 on the Fort Lauderdale coast and will house both 130 hotel units and 90 private residential units. Another new offering, the TRYP by Wyndham Maritime Hotels, opened alongside Marina Bay, catering to the marine crowd with 150 rooms in Fort Lauderdale. The renovation of the Broward County Convention Center has been delayed. In the original timetable, construction was slated to begin in 2018 and be completed in 2021. As of September 2018, the plan changed to a 2020 construction start date and a 2023 completion date. The renovation will increase the convention center’s exhibit space by 75 percent. The 350,000 square feet will dramatically increase the facility’s ability to host events and conferences. The county is also proposing an 800room hotel to be leased and operated by Omni Hotels. Some existing hotel are expanding or updating their offerings to stay current with the new
construction going up around the county. The Pelican Grand Beach Resort is planning a $7 million renovation to add new luxury suites and to remodel all existing rooms in order to stay current. Smooth sailing In 2017, Port Everglades was ranked the third-largest cruise port globally, with 10 cruise lines and one ferry operator working out of the port. The total number of passengers increased by 1 percent over the previous year, to 3,863,662, which is impressive given the closure of Terminal 4 at the height of the season. Also in 2017, Carnival Corporation finished its renovation of Terminal 2, which was the first cruise terminal in the world designed to interface with Carnival’s Ocean Medallion wearable technology. The terminal also boasts an OceanView Theater and more comfortable seating areas.
In 2017, Port Everglades was ranked the thirdlargest cruise port globally, with 10 cruise lines and one ferry operator working out of the port.
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Celebrity Cruise’s first branded cruise terminal opened in October 2018. The terminal was designed to support the line’s newest ship, Celebrity Edge, and to provide an easy onboarding and check-in process. Before the new terminal, Celebrity Cruise guests made up about 9 percent of the port’s cruise traffic, but with the increased capacity of the new terminal, nearly 500,000 guests are expected to move through the port, increasing Celebrity’s share to 14 percent. LGBT+ tourism The Greater Fort Lauderdale area has long been known as a welcoming LGBT+ vacation hub. The region has the highest concentration of same-sexcouple households in the nation, and Mayor Trantalis, who was elected in March 2018, is the first openly gay mayor of a major Florida city. The GFLCVB has a specific LGBT+ team dedicated to maintaining the region’s gayfriendly reputation, which in 2018 opened an LGBT+ Visitor Center to showcase the area’s attractions, including the nation’s first AIDS museum, the Stonewall Museum and one of the largest Pride Centers in the U.S. The region will also host the first-ever Pride of the Americas event in 2020. The event is expected to attract more than 350,000 people from all over North, Central and South America. Every year, the region welcomes over 1.5 million LGBT+ visitors, who spend about $1.5 billion in the area, making the sector a key player in Broward’s tourism economy.
Tantalize your taste buds With more and more people moving to and visiting Broward County, the restaurant industry is growing quickly in the region. To highlight this, the GFLCVB is producing a series of videos, called Crave GFL, showcasing local restaurants. Oakland Park, specifically, is getting recognition for its culinary district, featuring its star tenant Funky Buddha Brewery. Casa Sensei, a Latin-Asian fusion restaurant, opened its doors on Las Olas Boulevard in November 2018, and it was not the only new restaurant on the block. In the second half of 2018, more than 1,000 restaurant seats were projected to come online on Las Olas alone, increasing the vitality of the district’s shopping, dining and entertainment offerings. Most important for younger restaurants is finding a crowd, and technology can be a helpful tool for attracting guests. As Elliot Wolf, CEO of the be nice Restaurant Group, told Invest:, “Social media is huge for us; it’s our number one priority when it comes to marketing. We also enable online ordering, which is in high demand. People are on their phones all the time. It’s the world we live in.”
The Greater Fort Lauderdale area has long been known as a welcoming LGBT+ vacation hub.
Sunny future Tourism, unsurprisingly, is a huge piece of Broward’s economy. With sun, fun and miles of sandy beaches available in equal measure,
Scott Knutson Vice President of Sales & Marketing – Costa Cruises
We’re very happy here in Fort Lauderdale. It’s a very visitorfriendly area, which makes things easy for our guests. There are restaurants and attractions conveniently located. The port is modern and ever-improving, which is a positive for our guests who arrive from all over the world. About 10 percent of our guests are from North America. On Caribbean sailings our guests are surrounded by international passengers. You don’t always find the same level of friendliness in European ports, so we get very high ratings for Fort Lauderdale from our guests.
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TOURISM, CULTURE & SPORTS OVERVIEW
The second half of 2018 saw more than 1,000 restaurant seats come online on Las Olas Boulevard alone, underscoring Greater Fort Lauderdale’s growing reputation as a culinary destination.
the region provides both visitors and residents alike with convenient dining, shopping and cultural experiences. From boat parades to NHL games and from traveling art exhibits to pride celebrations, the
Greater Fort Lauderdale region has it all. There’s no doubt the area will continue to thrive thanks to the many visitors from all over the world who choose to spend their time here.
Tim Petrillo President & CEO – The Restaurant People
Typically, residents are opposed to increasing density but want the great experiences available in bigger cities. However, businesses aren’t going to take the risk if people aren’t there. Now that Fort Lauderdale is getting that density, we’re able to offer more targeted experiences. Our restaurant TRP Taste is a 24-seat restaurant with rotating visiting chefs from all over the county. Six years ago, we never would have considered opening this restaurant here.
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TOURISM, CULTURE & SPORTS OVERVIEW
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ECONOMY OVERVIEW
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