Development Trends in U.S. Coastal Cities
by Mike Sheridan (Urban Land Magazine)
Lou Plasencia was quoted in this article posted on August 19, 2019. This abridged version features his commentary on Florida’s coastal markets. The full article is available on the Urban Land website.
Despite the severe weather, Florida remains as hot as it has ever been, and we’re not referring to climate,” says Lou Plasencia, CEO of the Plasencia Group, a Tampa-based national hospitality sales, investment consulting, and advisory firm. “Transaction activity was very strong in 2018 and is anticipated to be robust again this year, especially along the beaches and in urban markets. We expect to see very little slowdown. Areas recently affected by hurricanes, namely the Florida Keys and Southeast Florida, are back to normal with virtually all hotel rooms back in service—maybe even stronger, we would argue, than before. The state has proven its resilience to major weather events and has taken steps to preplan its reaction to and recovery from strong hurricanes.”
Plasencia says that he has not seen any letup in the pace of new construction. “The impact has instead been on the cost of construction since many contractors and their subcontractors have been lured to areas in need of storm-related repairs,” he explains. “These events have also resulted in higher construction costs. We have not seen any meaningful shift in the use of stronger and vastly improved construction materials since Hurricane Andrew in August 1992.”
So far, at least some real estate investors seem unconcerned about the severe weather the United States has been experiencing. “No one has commented that there has been any increase in the frequency of natural disasters, and we have seen no serious reaction by institutional or private investors,” Plasencia says. “In fact, these events have often attracted investors seeking to acquire affected properties, perhaps at a discount.”