| What is the overriding issue facing Northeast Florida’s real estate development market in recovering from the recession? | What will be the first sign that the market is recovering, and when do you expect to see it? | How seriously was your field of the real estate market affected by the recession? | Have you ever seen anything like this recession? | |
| Edward E. Burr President and CEO GreenPointe Holdings LLC | There are two overriding issues confronting the residential real estate industry in Northeast Florida. The first is the large volume of foreclosures active and pending in our area. Until these units have transitioned through the system and been absorbed by the market, homebuilders, other sellers and buyers will continue to be uncertain whether pricing has hit bottom. The second is our high unemployment rate which continues to be in excess of 11 percent. Housing will not recover without job growth. | There are several factors to signal that the market is recovering, with job growth and inventory levels being important ones. There are certain submarkets of our region where inventory levels including new homes, resales and foreclosures are in balance with absorption and the pricing is appropriate relative to household incomes. These areas appear to be on the leading edge of a recovery. | In Florida, housing peaked in the fourth quarter of 2005 and five years later there is debate whether we have reached a bottom. All product types and geographic regions have been affected, with price impairments as much as 70-80 percent for some products and absorption is at only a fraction of peak levels. | The depth and length of this recession in the housing industry is unlike anything I have experienced in my 30-plus years working in the industry. |
| Bruce Johnson Executive Vice President and CFO Regency Centers | High unemployment and low economic growth are the important issues. Unemployment in Florida and Northeast Florida is approximately 11.5 percent. Job growth will be weak, as it has been for the last three quarters, until there is a higher level of gross domestic product growth. GDP growth and increased consumer spending, driven by job growth, will spur business expansion and are the primary drivers for the office, retail, industrial and hospitality sectors. | Decreasing vacancy rates will be our first sign of a real estate recovery in Northeast Florida. However, once there is a higher level of sustained GDP growth, I expect that leasing activity will begin to pick up and vacancy rates will begin to decrease. | Nationally our operating shopping centers lost slightly more than 2 percent in occupancy. In the 10 years prior to 2009, our operating properties were occupied in the 95 percent area. In addition, the lost occupancy has put pressure on rents in most markets with an average reduction of approximately 20 percent to 30 percent on a peak-to-trough basis. | This would be the worst recession I have experienced. I began my real estate career in the early 1970s, so I experienced the ‘74-75 recession. But neither that recession nor the ‘90-’91 recession was as bad as this recession. |