Market Forecast - Spring 2015

Expect that Sarasota’s commercial real estate recovery will continue to be led by residential and hotel land sales and development, both from projects that are already proceeding and those poised to undergo construction in the near term. If current conditions continue, look for Southwest Florida’s office market to incrementally improve throughout the balance of 2015 amid decreasing vacancy rates. The same will hold true for industrial properties. Harshman & Co. does not anticipate activity will significantly diminish existing vacancies, but incremental improvements should lead to a healthier market overall in this sector by the end of 2015. Retail activity remains the area’s wildcard. While there can be little doubt that the University Park area will continue to attract retailers, as evidenced by the recent announcements regarding convenience purveyor Wawa and specialty grocer Whole Foods Market slated for Honore Avenue and University Parkway, other pockets – including downtown – are expected to thrive as well. In addition to the often noted $315 million, 880,000-square-foot Mall at University Town Center, which has enticed many retailers from Westfield Corp.’s Southgate Mall and at least one from downtown, St. Armands Circle has shown remarkable resiliency in the face of the Great Recession and stiff competition from UTC. Its occupancy is nearly 100 percent, while downtown also fared well, though some 58,000 square feet of retail space remains vacant.