What will we take away from 2008, other than more gray hair and a new yardstick for economic anxiety? Sinking under a real estate meltdown that began in 2007, we confronted ever-rising gas prices, a mountain of foreclosures and business closings, and then got broadsided by a Wall Street crisis that turned into global disaster.
Yes, the year’s top stories are grim, but we searched for—and found—some cheer on the horizon.
Sarasota-Manatee still has all the right stuff to prosper. Our beautiful region will continue to attract a generous share of baby boomers, many of them with the drive and desire to be entrepreneurs.
And while real estate and construction continue to suffer, some local developers got serious this year about building affordable housing for the people we want to live here: middle-class workers. Meanwhile the weak dollar encouraged growth in European tourism and companies that produce products for export.
So before we go bravely forward into 2009, let’s take one last look back at 2008.
Everybody Talked About
The collapse of Wall Street. It led to federal bailouts, worldwide investor panic and talk of a deep global recession—or is it depression? Real estate investments had already tanked—now shrinking stock portfolios, both of retirees and workers, threatened consumer spending, charitable giving and future financial security for many in the region.
Whether attracting the Boston Red Sox to
The effect of rising gas and utility prices on commuters and businesses.
The history-making presidential campaigns, with both a black man and a woman on the major party tickets, and the increase of Democratic voters and candidates in our once mainly Republican region.
Residential foreclosures, which were happening next door, down the street or worst of all, at home.
Offshore oil drilling, which Congress voted to extend along coastal states, though they kept drilling away from
Restaurant and retail closings, those sad reminders of the grim economy.
An elected mayor in
What’s Up What’s Down
Gas Prices SUV Sales
Home Foreclosures Population Growth
Unemployment, Job Losses School Enrollment
Home and Condo Sales Median Home/Condo Prices
Sun Hydraulics Profits Local Banking Profits
Public Transportation Passenger Counts Auto Trips
Office Vacancy Rates Office lease prices
Bankruptcies Business Confidence
COMMERCIAL REAL ESTATE SLOWDOWN
Commercial real estate follows rooftops, the saying goes, so no one was surprised when commercial construction stalled.
Established developers defaulted on loans because they could not get approved residential projects off the ground. Venice Developer Mike Miller was one of them. His $23 million Palms at Riviera Dunes condo project in Palmetto was foreclosed on by Regions Bank.
Other developers held on, waiting for the market to rebound. After demolishing the Sarasota Quay on U.S. 41, Patrick Kelly’s $1 billion Bayside project slowed to a standstill, and nearby condo residents demanded a cleanup of the unkempt construction site. Downtown
But there were bright spots. Benderson Development’s
Hoteliers were bullish as tourism held steady in Sarasota-Manatee. The downtown Hyatt Regency Sarasota proceeded with its $22 million renovation, and construction began on the $100 million
The Manatee County Commission approved Lakewood Centre, the buildout of Lakewood Ranch between S.R. 64 and S.R. 70, which would quadruple commercial space to more than 4 million square feet over the next 10 years. The commission also approved plans for developer Schroeder-Manatee Ranch to build 3,200 homes there. FedEx broke ground on a 123,000-square-foot sorting and distribution facility on
Early in the year, Wellcraft Marine, a boatbuilder with a 50-year history in the area, announced it would move operations out of state, citing “negative manufacturing economic conditions in
At mid-year, Manatee County EDC’s business climate survey revealed that 50 percent of businesses believed their industries to be in worse shape than last year, and 41 percent reported negative growth. With local companies imperiled and very little relocation activity, both EDCs devoted most of their energy and resources to business retention.
But some manufacturers announced expansion plans during 2008, and a number local companies doing business overseas, such as Sun Hydraulics, posted growth in profits.
METI, a manufacturer of patient simulators, and L-3 Aviation Recorders, producers of cockpit voice and flight data recorders (black boxes) underlined their long-term commitment to
GROWING OUR OWN
The concept of economic gardening (growing existing companies rather than attracting outside companies) captured more attention, and home-grown companies such as Internet advertising firm IntegraClick proved Sarasota-Manatee has a base of potential high-growth gazelles already. Both Tervis Tumblers and Medical Education Technologies reported rapid growth. Clockwork Home Services continued to acquire home service companies, extending its Benjamin Franklin Plumbing, One Hour Air Conditioning & Heating and Mister Sparky franchises to 555 territories by mid-year. Bradenton-based First Watch Restaurants, the largest privately held, daytime-only chain, with 76 restaurants, announced plans to sell regional franchises and expand across the country. Beacon Products and Sunovia Energy in Manatee boosted revenues through the development and production of clean energy products. Commercial real estate investment firm Meridian Development Group, known locally for turning around a vacant Winn Dixie warehouse in Sarasota, announced plans to grow its portfolio of bulk distribution, flex and low-rise office properties by 5 million square feet.
Some businesses made gains through mergers. Tulsa, Okla.-based Manhattan Construction Group purchased Kraft Construction Company, builder of 1350 Main, Plaza at Five Points and the new
Sarasota-based TV Net Media Group purchased La Voz Hispana, a 12-year-old magazine catered to a South American audience and revamped the publication, growing its pages and its advertisers by 300 percent within the first few months.
A PROPERTY TAX REVOLT
Every business, from the medical office to the marina to the family-operated motel, was slammed with increases in taxes and insurance. In January, voters approved Amendment 1, the Florida Legislature’s response to growing outrage over the state’s broken property tax system. The amendment increased the homestead exemption, added portability to the Save Our Homes’ 3 percent cap on assessment increases, and capped skyrocketing nonhomestead property assessments at 10 percent annually. Gov. Charlie Crist traveled the state to promote the amendment, which he said would jump-start the economy by boosting the residential real estate market.
But Amendment 1 was to be only the first step in reforming
Declining state revenues forced the Florida Legislature to reduce its budget by $2 billion; it was expected to return for a special session to cut more. Local governments cut staff and budgets. And businesses and property owners continued to demand tax relief.
ECONOMIC STIMULUS PLANS
The Manatee County Commission sought legislative approval of a Port Manatee Encouragement Zone, which would waive local impact fees, extend the Foreign Trade Zone and accelerate permits to create a new, streamlined zoning classification for port-related land use. The effort was unsuccessful, but they plan to try again in 2009.
Economists’ predictions that we were nearing bottom in early 2008 proved overly optimistic as homes and condos languished on the market, prices continued their slide and Sarasota-Bradenton posted record foreclosure rates.
With slow sales and a two- to three-year surplus of home and condominium inventory, real estate companies became creative, continuing the Time2Buy campaign in
BANKERS TIGHTEN UP
Local banking took a blow when First Priority Bank of
Yet nearly every established local bank posted losses, and some hobbled along with percentages of nonperforming assets in the double digits.
Meanwhile, the tight credit market and real estate devaluation crippled small companies, and some owners relied on their homes and office buildings for loan collateral. Even SBA-guaranteed loans decreased in
But the challenging retail landscape did not deter national chains from Sarasota-Manatee. Kohl’s Department Store opened on
As fewer local businesses opened, what little activity there was seemed all the more notable. In downtown Sarasota, Theresa Guest and Robert Seth-Ward, former owners of Chic Chateaux and Churchill's Furniture in Sarasota, established the10,000-square-foot Sarasota Antique Mall on Lemon Avenue. Ceviche restaurant opened in the renovated Sarasota Times building and quickly became a hot spot. The Seidensticker family took over the former Fred’s Restaurant on
A CHANGE ELECTION
As presidential candidates spoke of change and maverick reform, local officeholders faced formidable challenges. State and county incumbents who had been re-elected without opposition fought to retain their seats. A newly resurgent Democratic party in
Clean energy, as FPL dedicated its 250-kilowatt solar array of 1,200 solar photovoltaic panels, the largest in the state, at
Sun Hydraulics Corporation, producer of high-performance hydraulic cartridge valves and manifolds for worldwide industrial and mobile markets, was named a “winner” by BusinessWeek for earning more than half its $167 million in 2007 sales outside the
Neal Communities, for the most visible foray into the affordable housing market. Neal unveiled and quickly sold Café Collection homes priced in the $130s in its Forest Creek community near Parrish.Commuters, after Zep Construction of Fort Myers rebuilt three lanes of I-75 in
Tomato farmers, after a nationwide outbreak of a rare strain of salmonella in April led grocers and restaurants to pull tomatoes from their shelves. Manatee tomato growers watched their crops, and their season’s revenues, wither on the vine. The culprit was later found to most likely be peppers grown in
Workers, as Sarasota-Manatee’s unemployment rate, recently one of the lowest in the nation, rose to more than 7 percent. While construction and professional services were hit hardest, job insecurity spread across sectors, and city and county governments,
Small business borrowers, who lost access to credit as the value of their real estate collateral evaporated. Many relied on credit cards or postponed expansion plans.
Sales tax reformers, led by former state Senate President John McKay, who were prepared to battle on behalf of Amendment 5 in an effort close sales tax loopholes. The amendment was removed from the ballot after a court challenge.
Hockey hopefuls, after Sal Diaz-Verson, president of the proposed DVA Arena Hockey Facility in Lakewood Ranch, filed for Chapter 11 bankruptcy protection to stave off a foreclosure sale and buy time to raise capital for the stalled project. The bankruptcy was tossed out and the project was set for foreclosure.
Sarasota Reading Festival and Sarasota Arts Day fans, as both of the popular (and free) outdoor festivals were cancelled because of economic conditions and diminishing corporate sponsorships.
Smokers, as Sarasota County Government announced a tobacco-free hiring policy for all new job applicants, who would be required to acknowledge they had not used tobacco products for the preceding 12 months.
Debra Jacobs, as president and CEO of the Patterson Foundation, which grew overnight to one of
Dr. Sarah Pappas, who didn’t remain idle after retiring from her job as head of
Tony Souza, promoted to executive director of Habitat for Humanity. Souza had left his position as head of
Sheryl Palmer, as CEO at Taylor Morrison, the
Teresa Dick, as CEO of Bradenton-based Administrative Concepts.
Lana Cain Krauter, as president of Beall’s Department Stores Inc.
New Manatee County Commissioners Larry Bustle and John Chappie, who ousted incumbents who were perceived as less favorable to business and growth.
Brian Kennelly, new president of Lakewood Ranch Commercial Realty.
John Bednerik, as executive of the 750-member Englewood-Cape Haze Area Chamber of Commerce..
Sheila Belknap, as president and chief executive officer of the Van Wezel Foundation, replacing Rodger DeRose, who resigned to become president and CEO of The Henry H. Kessler Foundation.
Michael Worthington, as president and CEO of Florida Bank in
John Swart, president of Lakewood Ranch Commercial Realty, who retired after 12 years on the job and after being credited for turning empty territory into 4 million square feet of commercial space—2.5 million office, 800,000 retail and 700,000 light industrial.
Sarasota County Property Appraiser Jim Todora, after business and party leaders recruited another Republican to run against him, and charged that his property appraisal process overvalued property after values had plummeted.
Martine Collier, who abruptly resigned from her post as executive director of the Sarasota County Arts Council at the end of a board meeting in July, taking even the chairman by surprise.
Jody Kielbasa, who announced he would leave the Sarasota Film Festival, which has been reported to be suffering financial difficulties.
Jay Brady, who parted ways with the Gulf Coast Builders Exchange.
ACCOLADES AND ACCOMPLISHMENTS
The Sarasota-Bradenton metro area was ranked in the top 5 in the nation in terms of entrepreneurship measured by self-employment by the Kauffman Foundation.
Sarasota-Bradenton-Venice was picked as the 46th-best city for relocating families on a list compiled by Worldwide ERC, a Washington, D.C.-based relocation specialty firm.
Sarasota-Bradenton was ranked second in the “2007 Florida Cybercities” report released by the AeA comparing high-tech wages to pay in other types of jobs, and 7th with regard to overall employment.
U.S. News & World Report’s 2009 edition of “
Lake Erie College of Osteopathic Medicine (LECOM) in
The Roskamp Institute of Sarasota launched a three-year Neuroscience Alzheimer’s disease and related disorders research doctorate program, becoming the first Florida-based research facility to host a laboratory-based research program of its magnitude.