Tampa/Hillsborough commercial real estate roundup
July 8, 2015
Tampa Bay’s economy in the second quarter gained healthy momentum on all fronts.
The EDC’s latest Economic Indicators report for April showed a continuation of positive trends approaching mid-year. The Tampa metro added 39,100 jobs year-over-year and Hillsborough County’s unemployment rate dropped to 4.8 percent – the lowest level since November 2007. Cargo activity is robust – Tampa International Airport reported a 4.4 percent jump over last year and Port Tampa Bay’s container traffic increased by 15.4 percent. The influx of new residents occupying residential units continues to climb – Tampa Electric’s count of active meters in Hillsborough increased by a healthy 1.8 percent over the same time last year.
Also, the EDC’s Cost of Living report for the first quarter of 2015 reinforced some of the reasons why the Tampa/Hillsborough market is so attractive to both businesses and the residents that make up our expanding workforce. Tampa’s overall index (92.6) compares very favorably not only with the national average (100.0), but also when benchmarked against ten other major markets located across the southern and western U.S.
The pendulum appears to be swinging back in favor of new development with declining vacancies, especially for top-tier space. Developers have been eyeing the Tampa/Hillsborough market for opportunities and are now acquiring sites and moving ahead with the intent of capitalizing on this upswing in activity. Earlier this year, McDonald Development acquired 301 Business Center, a 69-acre site, as its initial entry into this market. With 859,000 square feet of industrial entitlements in place, the development is well positioned to deliver a build-to-suit or speculative building. The Atlanta-based company has developed more than 40 million square feet of real estate and is intent on getting underway with new construction before year-end.
Build-to-suit options are substantial for both office and industrial users and sites are available to accommodate significant projects. In east Tampa, USAA, the insurance and financial services giant, is well underway with its new 16-acre Crosstown campus which will add 261,000 square feet of new office space and an attached parking garage. USAA currently owns a 500,000 square foot office in Tampa’s Commerce Park which houses 2,000 employees. The new facility, which broke ground in June of last year, will accommodate 1,200 employees and is expected to be completed later this year.
Westshore, Tampa’s largest business district with over 12 million square feet of office inventory, is attracting a variety of new development activity.
Crescent Westshore, a new 375-unit luxury residential community has just broken ground near the corner of Lois Avenue and Boy Scout Boulevard and is scheduled to open next summer. Adjacent to this project is Parkway’s site for its proposed Cornerstone development – a 285,000 square foot Class A office building. Parkway has significant holdings along the Boy Scout Boulevard corridor with four Class A office buildings in its Corporate Center portfolio containing over 1.2 million square feet.
The recent acquisition of a 1960’s-era office complex in the core of the Westshore district has created a new buzz about redevelopment opportunity. Redstone Investments recently closed on the Austin Center property – five office buildings totaling approximately 300,000 square feet on 10 acres. Redstone has commissioned a team from CBRE to develop potential uses for the site which could include office, retail, hotel and residential. Read more about this project in the Submarket Spotlight.
Tampa’s office market is benefiting from a steady stream of new ownership and investment in its existing office inventory. The Fifth Third Center, which was purchased by Fairlead Commercial Real Estate last July, recently announced a $1.5 million renovation project. The 281,000 square foot office building located in the downtown business district will undergo a number of upgrades, including a new 4,000 square foot amenities center for the tenants. The investment activity level is expected to remain high for other office buildings currently on the market, including the 36-story SunTrust Financial Centre and the 515,000 square foot Rivergate Tower, both located in Tampa’s central business district.
Have questions about Tampa and Hillsborough County’s commercial real estate market? I’d be delighted to assist you. Please contact me at email@example.com or 813-518-2650.