Market voices: Facing the challenges Scott Helms, Principal, Helms Development Terry Salzman, President & Principal, Salzman Real Estate Advisors Nicole Shiman, Senior Vice President of Investment, EDENS Andrew Zidar, Vice President of Development & Acquisitions, RK Centers

Scott Helms

Principal Helms Development

The last three large sites over 50 acres that I’ve developed were a filled lake, a trailer park and a women’s prison. You don’t find large industrial sites sitting out in the market. It doesn’t happen. It has to be a site with a di erent zoning and with the ability to entitle. There are several large projects in the entitlement process, a Sunrise vacant site for 1 million square feet for Amazon and a Pompano site that was formerly part of a harness track with an unnamed tenant. Anything of substantial size has to be repurposed. Due to the scarcity of the industrial sites, land prices continue to increase.

The challenges for retail are national and international. The ability to invest in that space is driven by the individual market. South Florida is really unique in the fact that even in the worst of times, South Florida continues to grow, it just slows the pace as opposed to moving in the opposite direction. Part of the challenge for that is that land prices make it a very expensive place to do business. As you look at some of the regional mall properties that are being repositioned, the owners of those properties are institutional or have gone back into receivership. You have to go in and analyze each one of those. Terry Salzman

President & Principal Salzman Real Estate Advisors

Nicole Shiman

Senior Vice President of Investment EDENS

COVID has been transformational, particularly within the commercial retail sector. EDENS, in Florida specifically, fared quite well despite the type of challenges that COVID presented. I think it’s because of the kind of product we own, our execution team and the kind of places we have in the market. We are predominantly neighborhood-grocery anchored. Further, we own trophy, transformative real estate, and in Florida we have a strong footprint. There’s no doubt that there have been significant headwinds, but we have tackled these challenges and, overall, we have done relatively well.

One of the big changes we’re seeing is retailers and cities looking to accommodate electric vehicles and charging stations at shopping centers. We already have anchor tenants requiring charging stations at the properties. I think that’ll be a lot more prevalent in the future, giving people who are coming to shop the opportunity to charge their car at the same time. I also think we’re also going to see a big push for solar energy. As property owners, we obviously have large parking fields, but we also have expansive roofs that lend themselves to the placement of solar panels. Andrew Zidar

Vice President of Development & Acquisitions RK Centers

Dev Motwani

President & CEO – Merrimac Ventures

I’ve always been a big fan of the south side of the New River, which has now been branded as Solo or South of Las Olas. It’s taken a little longer for that side to develop but we had a project there called 629 Residences, which we sold to OKO Group. We had a large investor come and buy all the land around us so it made more sense to sell to them and let them develop the area properly. I think it’s better for the city if they control it all. We sold that and bought another property in Flagler Village, which has obviously been a great success story and we think has a lot more potential especially when Brightline starts running again. You’re also starting to see more development in the corridor west on 6th Street/Sistrunk Blvd. There’s a great project, 613, that just opened and it’s doing really well.

( ) Looking ahead Overall, Greater Fort Lauderdale’s real estate market withstood one of its most difficult tests in recent memory. In the end, the solid market fundamentals that were present pre-pandemic remain, while the innovations and creative re-engineering of core businesses, together with the injection of flexibility, adaptability and resilience into the market’s operations have secured its long-term prosperity.

This is not to say that it has cleared the way to becoming challenge-free. Developable land is becoming scarce, meaning officials together with private developers will need to work in tandem to ensure real estate assets are developed in such a way that it secures the best longterm outcomes for the region and its residents and businesses. The landscape going forward will likely support development goals.

“We are in an extremely low interest rate environment and low interest rates do cover a lot of sins. Projects can still be feasible at 4-6% interest,” said Walter Duke, president of Walter Duke + Partners, in an interview with Invest:. He believes that opportunity lies ahead. “2021 will be a transitional recovery year with weaker assets getting flushed out and stronger assets and uses thriving. There will be tremendous opportunities for savvy investors. By 2022, we expect to begin seeing local governments begin to suffer from a decrease in tax revenue. Despite the coming difficulties, Broward County in general and Fort Lauderdale in particular are well-positioned to survive the negative impacts of the pandemic and make a recovery.”

The City of Fort Lauderdale has invested $1.5 billion in a massive e ort to revitalize some areas of the city, including the emblematic Las Olas Corridor.

Construction:

Between supply chain disruptions and rising material costs coupled with overall COVID-19 challenges, the Greater Fort Lauderdale construction sector certainly faced hurdles in 2020. Strong residential and industrial demand, however, carried the industry during this uncertain cycle.