Now that everyone's talking about a cooling of the national and local real estate market, should we be worried, especially at the upper end? Not yet, say local developers and realtors, and perhaps not for quite a while to come, providing that properties are priced sensibly.
Is there too much room at the top?
"I cannot build lots fast enough," says Pat Neal, president of Neal Communities, who defines "high end" as $800,000-plus. "There's enormous demand for something in that range."
Michael Saunders, who defines high end as $3 million-plus, says there is some leveling due to unprecedented amounts of new product in that price range, both in single-family and condominiums, and also because the real estate boom has encouraged a large number of resales. Saunders, president of Michael Saunders & Company, estimates that about a three- to five-year supply of $3 million-plus product is in the market, but adds that a well-priced property in a good location could still be snapped up in a day.
Michael Saunders & Company realtor Evella Feldhacker estimates that at the $2 million-plus level, there is about 10 months' supply on the market. So far, mortgage rates remain low, and wealth is compounded in the hands of wealthy boomers and immigrants, many of whom still consider this area a good deal for a second or third home compared to other parts of the state and country. In Sarasota County, for example, 173 $1 million-plus houses were sold in the first six months of 2005, compared to 141 in the last six months of 2004. In Lakewood Ranch alone, Feldhacker reports five $2 million-plus resales between January and June 2005, up from two resales in that price range over the previous six months.
However, inventory has also increased; in June 2004, only four houses in that price range were on the market, while in June 2005 there were nine. But Feldhacker says the supply is in response to high demand, and that Lakewood Ranch will defy the economic forecast of "bust or slowdown."
"Is it softening or it is sustainable? That's my question," says Feldhacker. "We could sustain if we get a correction here or there. A correction will be healthy in order for us to sustain growth, because it will allow other players to come in and buy vacation homes without saying to them, 'You're too late for the party.' If you own real estate in Sarasota County or Lakewood Ranch during the past two years, and you can think about the worst case scenario and it is acceptable, then we are in a great market. For example: If your home has increased in value 45 percent for the last two years, for a total of 90 percent, and it declines by 20 percent the third year, are you going to complain if it allows for the continuity of the upward trend?"
While single-family sales seem to hold strong, there are some doubts as to whether all condominium sales will hold. Neal says condo sales in downtown Sarasota are overheated. Saunders says single-family sales are definitely stronger, but that has traditionally been the case, and that many retiring baby boomers, who like condos, may change that trend. Those boomers are, in fact, the main reason many realtors and developers aren't too worried. Neal says that with 4 million boomers retiring each year, enough demand will be created to balance the supply. "We're going to have a huge demographic-driven market," says Neal.
"The boomers have distorted all the markets, and I think their sheer numbers are going to assure us of a continued demand," says Saunders. "Florida will be undersupplied to meet that need at all price ranges."-Anu Varma
MY FIRST JOB
The Wine Warehouse's Thomas Morgan got his start as a struggling farmer.
Thomas Morgan, 31, has managed Sarasota's Wine Warehouse since 2001 and is a partner in the company, which has 19 stores across Florida.
"In September 1999 I was leasing a 100-acre certified organic blueberry farm outside of Gainesville. I had studied horticulture at the University of Florida and then went to Evergreen State College in Washington state in 1998 to continue my education in sustainable farming. Just before that first year was up, a friend called and said, 'I know this guy who's got a certified organic blueberry farm in Florida.' The guy was Wine Warehouse co-founder Tom Dorn, who'd had all these wine stores for 18 years. He'd bought the farm to increase the number of certified organic acres in the state as a favor to a friend who started the Florida Organic Growers Association.
"The first year, the rent was a dollar. The farm was a potential treasure covered in overgrowth. We spent a lot of time hacking away with machetes and saws, cleaning out the barn, reorganizing what tools were there, figuring out what needed to be purchased for the next year's harvest in May, trying to figure out labor needs.
"After about two months of that, during a meeting with Tom about his vision for the farm, he and I got into a discussion about what my income was and what I needed to get by. I wasn't making any money. So I took a job in his warehouse at $10 an hour. I learned everything I know about wine from working in the warehouse. Boxes would come in and I would open every one and ask tons of questions: 'What is this? Where's it from? What's its price?' By the time Christmas rolled around, I knew I wasn't going back to the farm. I was just too engaged."-Interviewed by Hannah Wallace
In retirement, media big-leaguer Charles T. Brumback turns to citrus.
Smelling the Oranges
Charles T. Brumback is a turnaround guy. He took the Chicago Tribune, an underperforming institution in 1981 when he arrived as president, and turned it into a powerhouse newspaper by 1989, when he was named CEO of the Tribune Company. The Chicago Tribune won seven Pulitzers and "posted double-digit revenue and profit growth annually" during Brumback's tenure, according to a Web site Tribune employees designed to celebrate their former boss.
Not that he was always lovable. Brumback's management style could be ruthless and unpopular: He busted a union, sold off a lackluster asset (the New York Daily News), and sold the company's Canadian paper mills to fund a technology makeover for the Tribune. But early on, Brumback correctly believed that technology would revolutionize the media business. He put a computer on every desk, networked the operation and launched online products before most of us knew what the Internet was.
"I just enjoyed making it better," Brumback said from the Sarasota home he shares with his wife, Mary. "We pioneered the role of media on the Internet."
When Brumback reached the Tribune board's mandatory retirement age, he and Mary chose the charm and peace of Sarasota over the congestion of Florida's East Coast. They maintain a small home in Indiana on the edge of a corn field, for "when it gets too hot" in Florida. Brumback says the best thing about being retired is "staying busy-with things I want to do."
That includes spending time with four children and seven grandchildren and being a citrus farmer (he and his son, Wesley, grow 1,100 acres of orange trees and 100 of Marsh pink seedless grapefruit near Arcadia). Brumback caught the citrus-grower's bug while living in Orlando, where he worked his way up from comptroller to president and CEO of the Sentinel Star newspaper company. His family's 200-acre grove near Fort Pierce was a "very pleasant experience" back then, he remembers.
Even now, with the Arcadia grove, Brumback at age 77 is all about turnaround. At TRB Groves-named after the Tribune Company's stock symbol-he and Wesley have instituted state-of-the-art management practices, including a high-tech irrigation system that monitors soil moisture to conserve water, reduce runoff and grow healthier trees. They also capture and reuse runoff, which further reduces the farm's use of water from underground wells that tap the aquifer.
Says Brumback, "I've always liked to grow things."-Heidi Smith
Politician and planner Fred Tower on what's around the bend in transportation projects.
Fred Tower III is a North Port city commissioner and a Metropolitan Planning Organization (MPO) board member. He is currently involved in executing the Florida Strategic Intermodal Transportation System (SIS) plan, adopted by the state last January to help Florida's transportation system cope with population growth.
Could you briefly describe the SIS plan? The SIS is about making sure we don't have congestion as we move forward with our road planning.
Which projects are getting priority? Our No. 1 project is River Road, which goes all the way from the Charlotte County line to I-75. It probably won't get funded until 2015 to 2016 and will cost about $60 million. The second is the Venice Bypass, three lanes in both directions. Creating the right-of-way for that road costs $52 million, and construction is more than $25 million. The third priority is Upper Manatee River Road, from S.R. 64, and it costs $74 million. The fourth is Bee Ridge Road, for $47 million.
We're also working on an automated transportation system, putting cameras and signs on I-75 so people can get alternate routes and keep track of traffic. It's a way of saying, 'At the Bee Ridge exit, there's an accident, so take an alternate route.'
What other ideas has the MPO considered for cutting down on congestion? We've talked about what they have at Celebration in downtown Disney. They have a vehicle called a NEV (Neighborhood Electric Vehicle), a glorified golf cart. People drive those around town and keep their speed to 35.
We're working with SCAT and MCAT, looking for funding this coming year to double the buses on the populated routes. We're also looking at the water taxi, a ferry from Sarasota to Anna Maria. Longboat Key and Bradenton Beach are also interested. Sarasota and Anna Maria are working on a trial program.
Sarasota is working on a couple of roundabouts, [such as] at Fruitville and U.S. 41, to cut down on congestion. But there's controversy about roundabouts; with some of our older population they can be confusing.
There is a movement to build another road east of I-75, starting in Manatee County to Route 17 in Charlotte. But if you build a road 15 miles from I-75 further east, what you do is encourage growth out there. All you're going to do is expand both and actually add to the situation.
What obstacles are you facing in terms of funding for SIS projects? The feds have not been putting a lot of money behind this. The legislature passed a Growth Management Bill this year that provided additional funding for roads. The first amount goes to each FDOT district. Our district, District I, has 12 counties, and $31 million goes to all 12. Projects are starting to flow in right now. It's competitive. Everybody's going after the $31 million.
What advice would you give to frustrated drivers? Be patient. For example, take the Sarasota County portion of the MPO. Right now, we have enough projects on that list that it would take 30 years to fund them without adding any new ones, and we receive $8 million a year.-Interviewed by Abby Weingarten
A look at local, state and national health insurance coverage.
In the U.S. (2004)
Percent insured: 84.3
Percent uninsured: 15.7
No. of uninsured: 45,820,000
Percent covered by Medicare: 13.7
Percent covered by Medicaid: 12.9
Percent covered by military: 3.7
Percent covered by employment-based private healthcare: 59.8
Percent covered by direct-purchase private healthcare: 9.3
Percent uninsured 2003-2004: 19
Percent change from 2002-2003: -0.5
Rank of Florida among all states: 46 (1 being highest coverage)
*(Percents drawn from average of years shown. State ranking is drawn from 2002-2004 three-year average.)
In Manatee County
(2000 estimates released July 2005)
Percent uninsured: 13.6
Number uninsured: 36,466
In Sarasota County
Percent uninsured: 9.6
Number uninsured: 31,428
Source: U.S. Census Bureau, 2004 estimates from the Current Population Survey. Compiled by David Higgins.
Greater Sarasota Chamber Power Networking lunch 11:45 a.m. at the Chamber Boardroom, 1945 Fruitville Road, Sarasota. $12. Call 926-2810.
"Good Morning, Greater Sarasota!" 7:30 a.m. at AAA Auto Club-South, 258 Ringling Shopping Center, Sarasota. Free for Greater Sarasota Chamber members, $5 for non-members. Call 955-2508 ext. 525, or register at www.sarasotachamber.org.
Greater Sarasota Chamber partners meeting 7:45 a.m. at the Chamber Boardroom, 1945 Fruitville Road, Sarasota. Call 955-2508 ext. 234.
Greater Sarasota Chamber Power Networking lunch 11:45 a.m. at Marko's Grill, 3728 N. Tamiami Trail, Sarasota. $12. Call 926-2810.
Tri-Chamber Business Connections with Sarasota, Manatee and Venice area chambers. 5 p.m. at Sarasota Bradenton International Convention Center, 8005 15th St. E., Sarasota. $5 for members, $15 for non-members. Booths start at $285. Call 955-2508 ext. 239.
Old-Fashioned New England Clambake benefiting the New College Foundation. 6:30 to 10:30 p.m. at the New College bayfront. $90 per person. For reservations call 359-4419 or send a check to the New College Foundation, 5700 N. Tamiami Trail, Sarasota, 34243.
Downtown After 5 outdoor festival at 5:30 p.m. on Lemon Avenue and Main Street, downtown Sarasota.
Greater Sarasota Chamber new member briefing 4 p.m. at the Chamber Boardroom, 1945 Fruitville Road, Sarasota.
Downtown Partnership of Sarasota members meeting 7:45 a.m. at a location TBD. $5 donation. Call 951-265.
Sarasota Investor's Business Daily Meetup Group meeting 4 p.m. at DJ's Restaurant, 1296 First St., Sarasota. Call 366-0012 or e-mail [email protected]
"Destination Downtown" forum on The Vision for Downtown 11:45 a.m. to 1 p.m. at Sarasota University Club, 1605 Main St., Sarasota. $20 for Downtown Partnership of Sarasota members, $35 for non-members. Call 951-2656.