Recession? Lending Practices Aren't to Blame - Spring 2001

One look at the stock market and we gasp, but look at other indicators and the economic picture is not so glum. Unemployment is still low, interest rates are very attractive and real estate sales are strong. Translation: no one is expecting this downturn to be a long one.  Why? We can partially thank corrected lending practices that followed the painful real estate crash of the late 1980s and early 1990s. Remember the huge number of bank-owned and RTC properties? Today’s lenders are much more conservative and are not lending on speculative projects without significant pre-leasing.  Sound lending practices are helping us avoid the over-supply situation that prolonged the previous recession.                                                                  

Sampling of Sarasota Lease Rates:

Office Class “A”:  $19 - $30

Retail Downtown: $12 - $19

Industrial:            $  5 - $  9

Flex Space:          $ 9  - $15