A Friend Indeed
Originally published in the Feb/Mar 2010 issue of 850 Business Magazine
Regional News – Feb/Mar 2010 A Friend Indeed
Florida is one of the nation’s Top 10 entrepreneur-friendly states, according to a new ranking released by the Small Business and Entrepreneurship Council. The 14th annual report places Florida at No. 6 after evaluating a series of factors, including taxes, regulatory costs, government spending, property rights, health care and energy costs. (It probably doesn’t hurt that Florida has a constitutional ban on a personal income tax.)
The Top 10 states, in order, are: South Dakota, Nevada, Texas, Wyoming, Washington, Florida, South Carolina, Colorado, Alabama and Virginia.
The worst state is New Jersey. (You’ll remember that last year New Jersey. also ranked as the worst “business friendly” tax system in the country, according to the Washington-based Tax Foundation.)
Properties Brace for Collapse
According to industry experts, the commercial real estate market (which includes shopping centers, strip malls, apartment buildings, office buildings and warehouses) is due to suffer the same fate as the housing market — only worse.
Commercial research provider Trepp found that delinquent loans in commercial mortgage securities jumped 85 basis points to 5.65 percent at the end of November, up from just 4.8 percent a month earlier.
In addition, the Mortgage Bankers Association’s (MBA) Commercial/Multifamily Delinquency Report showed that between the second and third quarters of 2009, the 30-plus day delinquency rate on loans held in commercial mortgage-backed securities rose to 4.06 percent. The 60-plus day delinquency rate on loans held in life company portfolios rose to 0.23 percent. And according to Credit Suisse analysts, installments on $22.4 billion of mortgages were 60 days late.
The increase in delinquency rates is expected to continue through 2010 and peak in 2011.
“What we are seeing now is the perfect recipe for disaster in the commercial real estate market in 2010,” said Jeramie Concklin, chief executive officer of Guardian Solutions, a commercial loan restructuring company. “A huge number of balloon payments for commercial property loans are coming due in 2010 and 2011. With vacancy rates at high levels, unemployment soaring and commercial property values plummeting, commercial property owners are not going to be able to service their debt without serious restructuring of their loans and business. Property owners need to prepare now in order to avoid default.”
Measures of Florida’s Global Leadership/State Rankings
Share of U.S. Exports: 5
Share of U.S. High-tech Exports: 3
Share of U.S. Foreign Direct Investment: 9
Source: Roadmap to Florida’s Future, Enterprise Florida
Beaches Hit Big Time
Frommer’s travel guide has named “Florida Panhandle Beaches” as one of its top destinations to visit in 2010. Known as THE Beach, the region stretches for more than 200 miles along Northwest Florida’s Gulf Coast and is the only U.S. mainland destination on the list of 12 must-see places.
Lesley Abravanel, author of Frommer’s Florida, offered this description: “Stunning beaches, nature trails … great restaurants, and a cozy, yet quirky sense of community.”
THE Beach has long been a popular drive destination for residents of the Southeast, but has largely remained off the radar of the rest of the country. Local tourism officials hope will change when the new Northwest Florida Beaches International Airport opens in Panama City in May 2010.
“For a long time, we’ve felt like one of America’s best kept secrets,” said Mel Ponder, executive director of Coastal Vision 3000. Ponder’s group led the marketing drive to brand THE Beach, but in a surprise announcement in January, said it would be closing shop.
Foreclosure Update
34% Increase in Florida foreclosures in 2009
1 in 17 Florida homes receiving some type of foreclosure notice in 2009
516,711 Total number of Florida foreclosures in 2009
Source: RealtyTrac
