Are We Spoiled?

By Hannah Wallace April 30, 2006

For 42 years, Ian Black as practiced commercial real estate, first in his native Northern Ireland and then in Sarasota, where he moved in 1982. Three years ago, he opened Ian Black Real Estate in the Rosemary District in downtown Sarasota, representing clients such as developers Ersa Grae Corporation, Ram Development, Harvey Vengroff and Marvin Kaplan. He's also the chairman of the Downtown Partnership of Sarasota and on the executive board of the Sarasota Film Festival. Outspoken on matters of growth and government, Black speaks his mind about what he considers the myth of our affordable-housing shortage and a real estate market that's been the most exciting of his career.

You're not convinced we have a crisis in affordable housing. Why?

I believe the glass is half-full rather than half-empty. Let's start out with existing inventory. Condominiums are available under $200,000 within the city and as far north as Bradenton, where condos start in the $100,000s. Just look in the newspaper: 26th Street in Bradenton, the Club Med apartments on 12th Street and Tuttle, and Villa D'Este on Tuttle. There's a whole inventory of existing rental apartments. [Sarasota developer] Harvey Vengroff has a supply of affordable apartments, as do other local landlords. There must be a tremendous number of investors who bought units who can't sell them right now.

Why is there a misconception, then?

Numbers can say anything. If you want to say housing is not affordable in downtown Sarasota, I can't argue. If you want to say housing is not affordable in our community, period, you have to define community. We have a shortage in a certain particular geographical area. Perhaps the reason this is never talked about is because people don't necessarily want to live in these locations. People say they're not nice. Well, make it nice.

What efforts are being made to increase affordable housing in downtown Sarasota?

The Downtown Partnership is responsible for keeping this issue on the front burner. Our efforts deal with attainable housing, not affordable. The distinction is that "affordable" is [for] the lower-income person making $30,000 to $40,000 a year. Ours is in the $50,000 to $70,000 income a year. Habitat for Humanity is partnering with a national developer in the Rosemary Park Condominiums to do an affordable/attainable development in the $100,000s. The housing authority is realizing the housing stock needs to be replaced with a cross-section of Section 8s and mixed-use with mixed incomes. We will have enough housing inventory in the Housing Authority over the next five years that will provide an adequate supply of all sorts of housing of Section 8 and upwards.

Are you satisfied with what we've done with our TIF dollars?

I don't think we've done enough. The purpose of TIF dollars is to reinvigorate what was a depressed area. By 2015 we've got to use this pot of gold. After that it goes back into general revenues. Why do we wring our hands and go through such self-flagellation as a community? We were looking at a Main Street that is ugly. We're sitting at Five Points Park that's not the most attractive.

If Plaza Verdi had gone was a great would have been ahead of the current market. They were going to make it the center of Sarasota for the next 100 years. The fact that the city did not make that happen was frustrating. We would have had parking. Now it could be five years from getting anything done.

We're advocating TIF dollars for Fruitville Road. There are beautiful projects coming out of Fruitville Road: Marquee En Ville, the Enclave, Corvus' plan for the garden site. Are people going to buy $800,000 and $900,000 homes on Fruitville Road the way it is today? It should be a beautiful gateway to the city. We want to take the bike lanes away, put in beautiful palm trees along the median.

How would you describe the local real estate market right now?

The market's coming into play. I must get 60, 70 e-mails a day where people are reducing the prices of their homes by $100,000, $50,000, $60,000. Bonuses here, bonuses there. Rest assured, a lot of people who bought land in 2005 are not going to be able to make the numbers work. When was the last big project started in Sarasota? Maybe a year, 18 months ago. Why? Because land prices went through the roof, construction costs went through the roof, interest rates crept up. The major section of the market that kept these projects going, the investor market, has disappeared. Land sellers are saying, "I'm not going to sell it. I'm just going to hold on here and wait." I don't know what you're going to wait for. Tomorrow could be better, it could be worse. I don't know.

How does the commercial sector look?

There is a degree of realism coming in. Do the numbers work for you? Does it give you the return you want? Can you develop a property and get a fair rate of return, considering your risk? Those are all very subjective. Downtown there are a lot of small properties on individual lots. They have no ability to go to 10 stories. How many more big buildings are we going to get in Sarasota? We have a low vacancy rate for offices. The rents need to be a lot higher. Up to a 50-percent increase.

How would you sum up 2005?

I would tell everybody to forget about what happened in 2005. It's not going to help you. What I'd never seen before was the unbelievable greed that demonstrated itself. As a professional real estate broker-I've been doing this for 40 years-I couldn't act in a professional capacity, I couldn't give advice. It wouldn't be listened to, because some more uninformed person down the road would take the order. My frustrations with 2005 were an inability to help people realize their unrealistic expectations.

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