During the Great Recession of 2008, the residential market plummeted throughout the United States, including in Florida. This, in turn, caused Florida's commercial real estate market to go south as well. However, the state's commercial market has since turned around and appears to be on a huge upswing.
Lending in the commercial real estate market crashed by a whopping 90 percent during the recession. As a result, commercial construction experienced a huge decline. Home sales also saw a decline after 2006 but not as much, only because lenders backed by the government received money to prop up residential sales in the midst of the housing market crisis.
Encouraging news for real estate investors today is that the commercial real estate market is gaining strength, with prices having returned to where they were years ago before the recession. Commercial construction has not recovered at the same level due to sluggish growth in the economy. In fact, increases in the country's gross domestic product averaged under 3 percent until increasing during the most recent two quarters. However, commercial construction is continuing to improve.
Commercial real estate appears to be a burgeoning field in Florida. However, a seemingly promising deal may end up falling through if both parties cannot find common ground and consider the other side's views. In addition, a deal can be complex due to involving matters such as securitization, tax law and local zoning ordinances. An applied knowledge of related laws may help individuals to effectively pursue their best interests in the area of real estate.
Source: news-press.com, "Commercial lending 'collateral damage' in housing crash", Dick Hogan, Jan. 29, 2015