The Buzz
Leading Question
Q. Is the downtown building boom in Sarasota over?
Ali Ebrahimi, who three years ago developed The Plaza at Five Points-one of the first new condo projects downtown-isn't bullish on Sarasota anymore. After his ambitious Plaza Verdi project fell through, he told local media that the downtown condo market had gone soft and he had turned his attention to North Port to develop a shopping center.
Other developers are having second thoughts as well. No permits for condominium projects were issued in the first four months of 2006, compared to 10 in all of 2004 and five in 2005. And several projects that received approvals or were announced by developers are in limbo, including CityPointe, Wayne Morehead's project along Cocoanut Avenue; 1740 Main St. (the project was approved, but developer Chris Brown has walked away from it); and Michael Saunders' project on Orange Avenue (she has said she isn't certain of her plans). Also, Joe Hembree's 1335 Second St. was turned down by the city, and he has no plans to resubmit.
What's happening?
According to John Harshman of Harshman & Company, the slowdown was predictable. "Real estate is seldom linear," he says. "It's more of a stair-step progression than a gradual incline."
Harshman says the past two years' flurry of activity and escalating values couldn't last. "The market got used to intense activity. 1350 Main [a downtown condo] sold out in 90 minutes, and that's absurd. It's reasonable to have some calming, and it will take some time for these projects to be absorbed."
Harshman points to low unemployment and relatively low interest rates, a strong national economy and retiring baby boomers as reasons for optimism. "For every developer that leaves, four others are looking at the area," he says.
Longtime Sarasota developer Mark Kauffman concedes that the market is trickier today. "I'm cautious now. Before, you couldn't make a mistake," he says. "Just throw something up in the air and someone would buy it. Now there are a tremendous number of investment units that will hit the market, and they have to get absorbed. The cost of construction has increased, too."
Nonetheless, Kauffman is looking at developing another project downtown and says the major projects being proposed by Benderson Development at the Bank of America site at Main Street and Orange Avenue, and Isaac Group Holdings' Pineapple Square, at Main and Lemon Avenue, look encouraging.
"Downtown is healthy and viable," he insists. -Susan Burns
DOWNTOWN SARASOTA'S CONDO PERMITS
2004: 10 condo project permits issued, totaling 401 units, $144 million in value
2005: 5 condo project permits issued, totaling 466 units, $43.5 million in value
2006 (Jan.-April): No condo project permits issued
Source: City of Sarasota permitting department
CRUNCHING NUMBERS
TRAFFIC TIE-UPS
What road congestion costs you in time and fuel.
Total hours of delay annually in the U.S.: 3.7 billion
Total gallons of "wasted" fuel annually in the U.S.: 2.3 billion
Total gallons of "wasted" fuel annually in Sarasota-Bradenton: 3.4 million
Average annual delay for every person using motorized travel: 47 hours; in 1982: 16 hours
Annual delay per traveler in Sarasota-Bradenton: 19 hours; in 1982: 12 hours
Sarasota-Bradenton's national ranking in traffic delays: 52 out of 85 urban areas
National cost of congestion: $63.1 billion
Cost of congestion in Sarasota-Bradenton: $97 million
U.S. congestion costs saved by operational treatments (signal coordination, ramp metering, incident management): $5.6 billion
U.S. congestion costs saved by public transportation: $18.2 billion
Sarasota-Bradenton congestion costs saved by operational treatments: $5.8 million
Sarasota-Bradenton congestion costs saved by public transportation: $3.1 million
SOURCE: THE 2005 URBAN MOBILITY REPORT, Texas Transportation Institute. Based on 2003 data.
THE LIST
The region's largest law firms.
1 (941) 366-4800, www.williamsparker.com Attorneys: 44
2 (941) 366-6660, www.abelband.com Attorneys: 34
(TIE) Icard, Merrill, Cullis, Timm, Furen & Ginsburg
(941) 366-8100, www.icardmerrill.com
Attorneys: 34
3 (941) 748-0100, www.blalockwalters.com Attorneys: 17
4 (941) 366-4680, www.dglawyers.com Attorneys: 15
5 (941) 366-0115, www.lawyers.com/dunlap&morgan Attorneys: 14
(TIE) McConnaughhay, Duffy, Coonrod, Pope & Weaver
(941) 342-7603, www.mcconnaughhay.com
Attorneys: 14
6 (941) 748-3770, www.phkplaw.com Attorneys: 13
(TIE) Ruden McClosky
(941) 316-7600, www.ruden.com
Attorneys: 13
7 (941) 364-2481, www.kirkpinkerton.com Attorneys: 12
8 (941) 316-0111, www.levintannenbaum.com Attorneys: 11
(TIE) Norton, Hammersley, Lopez & Skokos
(941) 954-4691, www.nhlslaw.com
Attorneys: 11
(TIE) Syprett, Meshad, Resnick, Lieb, Dumbaugh, Jones, Krotec & Westheimer
(941) 365-7171, www.smrl.com
Attorneys: 11
9 (941) 957-1900, www.fsskbt.com Attorneys: 10
10 (941) 748-4411, www.dyefirm.com Attorneys: 9
(TIE) Harrison, Henrickson & Kirkland
(941) 746-1167, www.nelsonhesse.com
Attorneys: 9
BUSINESS CALENDAR
JULY 6 Greater Sarasota Chamber partners meeting, beginning with a continental breakfast, 7:45 a.m. at the Chamber Boardroom, 1945 Fruitville Road, Sarasota. Call 955-2508 ext. 234.
Greater Sarasota YPG After Hours 5:30 p.m. at The Tasting Room, 1917 S. Osprey Ave., Sarasota. No cover, no RSVP required.
JULY 13 82 Degrees Tech breakfast meeting Brian Cartland of the Sarasota EDC and Jay Brenchick of the Manatee EDC will speak on resources for starting and growing tech companies. 8 to 9:45 a.m. at Sarasota University Club. 1605 Main St., Sarasota. $10 for members, $15 for nonmembers. Call 870-0078 or e-mail [email protected].
JULY 18 Florida Public Relations Association Professional Development Luncheon presented by the Central West Coast Chapter, 11:30 a.m. to 1 p.m. at Marina Jack, 2 Marina Plaza, Sarasota. $18 for members, $22 for nonmembers. Prepay required; RSVP by calling 953-FPRA (3772) or at www.cwcfpra.com.
Greater Sarasota Chamber new member briefing 4 to 5 p.m. at the Chamber Boardroom, 1945 Fruitville Road, Sarasota. Call 955-2508 ext. 234.
JULY 19 Wake Up Venice! 7:45 a.m. at the Hampton Inn, 881 Venetia Bay Blvd., Venice. Call 488-2236.
JULY 22 Greater Sarasota YPG Beach Bash Noon to 4 p.m. on Siesta Key Beach. E-mail [email protected] for details.
JULY 24 Venice Chamber Network Lunch Noon to 1 p.m. at Left Coast Seafood Co., 750 U.S. 41 Bypass N., Venice. $10 RSVP by calling 488-2236.
Anna Maria Island Chamber Business Card Exchange 5 to 7 p.m. at Re/Max Gulfstream, 401 Manatee Ave., Holmes Beach. $5 for nonmembers. Call 778-1541.
JULY 25 "Destination Downtown" Forum Entertainment is the topic; presented by the Downtown Partnership of Sarasota. 11:45 a.m. to 1 p.m. at the University Club, 1605 Main St., Sarasota. $25 for members; $40 for nonmembers. Call 951-2656.
JULY 27 Venice Chamber Business After Five 5:30 p.m. at Lifestyle Family Fitness, 1667 U.S. 41 Bypass N., Venice. Call 488-2236.
MIND YOUR MANNERS
Business etiquette from national restaurant consultant Judi Gallagher.
I'd like to thank my boss for inviting me to her home. Any creative ideas? Most people will bring a bottle of wine. Although this is a nice gesture, once the bottle is empty, the memory is gone. Look at your boss's office. This might give you an indication of her favorite colors and styles. Potted bamboo in a neutral base is a wonderful gift-positive feng shui-and nothing too personal. If she enjoys cooking, you could bring or a bottle of aged balsamic vinegar-which lasts far longer than a bottle of wine and won't be easily forgotten-or a cookbook tied into a local charity. Not only are you acknowledging your boss's interests outside of the workplace, you're also showing your support for a worthwhile cause. www.judigallagher.com.
MY FIRST JOB
Betsy Nelson counseled people in golf and life before opening Metro Café.
Always Independent
Interviewed by Abby Weingarten
Betsy Nelson opened Metro Coffee & Wine in downtown Sarasota a year ago. She holds an honors degree in psych-philosophy and religion from Northern Arizona University, and has resided in Sarasota since 1987.
"I graduated college when I was 20, and I think I wasn't quite ready to launch into the real world at that age. I had applied to graduate school in divinity and was accepted, but I just didn't feel like that was the direction I wanted.
"So I became a golf teaching professional from 1981 to 1992, in the Pennsylvania-New Jersey area, and then in Florida. My parents were golfers. I probably had a golf club in my hand since I was two. I was teaching adults at private country clubs, making $60 an hour in cash. Women teaching professionals were really in short supply at the time, so it was easy to find a place to work. Those years gave me the opportunity to explore how I could make a living. I wanted to spend my 20s being self-sufficient and not being tied down.
"I learned a lot about how to tailor my instruction to somebody's learning style. I did a master's degree in biomechanics during that time. It really set me up well for my next career as a psychotherapist, which I did for 12 years.
"Teaching golf taught me how to end a session, and helped me establishe casual rapport with people. In both teaching golf and psychotherapy, I was running my own business. I also chaired the boards of a few organizations, and I learned enough about bookkeeping to know I could do that pretty confidently. Turns out I'm not a very good employee. I've always done much better working for myself."
FIVE QUESTIONS
Radio and TV host Hope Kerkof sounds off on the mortgage industry.
On Air
Interviewed by Abby Weingarten
Hope Kerkof is owner of Coast Capital Mortgage Group in Bradenton, a two-year-old company that specializes in residential and commercial properties and reverse mortgages across Florida. Listeners can hear her insights about the growing market live on The Hope Kerkof Real Estate Insider Show from 11 a.m. to noon Fridays on 1490 AM and 11 a.m. to noon Wednesdays on 1280 AM, and on Brighthouse TV Channel 19 at 7:30 p.m. Thursdays (in Manatee County).
What are callers asking you about? How to put real estate into their Roth IRAs to take advantage of tax-free benefits on their properties. We're one of two companies in the entire state that can help them do that, so I try to walk them through it. Other callers are concerned about what's going on in the real estate market, if the bubble has popped, etc. I tell them, if you talk to any appraiser, we're still having positive appreciation no matter what you read.
How is the flattening real estate market affecting businesses? The market has slowed or softened in terms of how many buyers seem to be out there. But a lot of that is due to the media spin and misrepresenting what's going on with interest rates. Even though the Federal Reserve has had 13 consecutive short-term interest rate hikes, it has not necessarily had an impact on mortgages. The appreciation rate has slowed down, but we're not depreciating. There is a bubble only because people are expecting this decrease-that a $300,000 home is going to somehow go down to $150,000. The last time that happened was in the 1930s in the Depression. People are not losing money on their homes. A seller may be listing a property for more than they should be selling it for, but they're still having positive appreciation.
Were people a little too greedy the last couple of years? I wouldn't say greedy as much as misinformed. They would see appreciation and not see the factors behind it, like waterfront properties being included in the equation. Prices should be listed as comparables. If you have an appraiser come in you'll know you are competitively and accurately listing your property. You will make a profit. It might not be 40 percent a year but it will still be a profit. The national average is 6 percent a year, so even 10 is still a good average.
What is the draw right now for a business owner coming to this region? We're expecting 15,000 people to come into each county in Florida for the next five to 10 years, so it's an excellent time to invest in residential and commercial properties. But if you're not already in the game, it's well worth your time to look at all your options.
Will you describe today's market? Right now is a great buyer's market. Sellers are becoming more flexible than they were six months ago. Real estate is always cyclical. Buyers usually go on what they hear in the marketplace. Historically, Sarasota-Manatee was completely undervalued compared to real estate prices across the United States. A lot of this 40 percent appreciation is what I call "the catching-up factor." When Money magazine listed us as one of the top 10 places to retire, we got more public recognition.