NOVEL Stonewall Station by Crescent Communities was recently sold to Lennar Multifamily Communities, a subsidiary of homebuilder Lennar Corp. with its eastern headquarters in Charlotte. The mixed-use community features high-rise and mid-rise residential units, light-rail access, and retail space, including a Whole Foods Market. The community has one of the largest displays of public art in North Carolina. (Crescent Communities)

To gauge the economic vitality of America’s Southeast region, consider one example: the Raleigh-Durham area in North Carolina.

After a lull late in 2018, the area has been adding jobs in dramatic fashion. “Payroll employment grew over 4 percent annually in the first and second quarters—over twice the state, region, and U.S. rates,” says Dante DeAntonio, senior economist at economic forecaster Moody’s Analytics in West Chester, Pennsylvania. “Job growth has not been this strong in consecutive quarters since 2006. Health care, professional/business services, and leisure/hospitality account for two-thirds of net new 18,000 jobs” in 2019.

The strengthening of the Raleigh-Durham labor market is carrying over into the area’s single-family housing market. “Prices are 25 percent above their peak in 2007, and new construction is at its high for the expansion, with housing starts back up to early-2000s levels and increasing at a well-above-average double-digit rate year over year,” adds DeAntonio.

Raleigh-Durham is not an anomaly. Strong economies, healthy job creation, and significant population increases are also being reported across the Southeast, including major cities Charlotte, Atlanta, Miami, Tampa, and Orlando. These metropolitan areas continue to experience dynamic real estate sectors thanks to strong technology, tourism, finance, and other sectors.

That could change in response to unforeseen circumstances, of course. And, like many other areas of the country, the Southeast is also facing numerous challenges ranging from affordability issues to keeping up with new infrastructure that can handle rapid increases in population.

But for now, the Southeast is on a roll.

“Charlotte is in a lucky geographic place, being an urban center in the Southeast region of the United States,” says Jon L. Morris, senior partner at Charlotte’s Beacon Partners, a full-service commercial real estate firm. “The area will certainly have peaks and valleys, but on the aggregate in the next months, years, and decades, the Charlotte MSA [metropolitan statistical area] will experience continued product growth across all asset classes as the U.S. population urbanizes.”

Dimensional Place in Charlotte, North Carolina’s Wilmore neighborhood was completed in 2019. Duda|Paine Architects designed the 285,000-square-foot (27,000 sq m) building on a 2.3-acre (0.9 ha) site. Dimensional Fund Advisors signed a 15-year lease, taking all the project’s office and meeting space. (Robert Benson Photography)

Atlanta continues its stellar economic run, too. Thanks to Georgia Tech (formally the Georgia Institute of Technology) and the area’s many other universities, Atlanta is one of the largest technology hubs in the United States.

“And few people know that Atlanta is one of the three or four most visited metropolitan areas in the U.S., with 51 million visitors last year—more than Orlando, Las Vegas, or Los Angeles,” adds George Banks, founder of Atlanta-based Revel, an experiential retail development and consulting company. “We are adding new public and private attractions every day that will bring even more guests. It is great for retail and entertainment but hard on hotels: we’re either fully booked or half empty.”

With low employment plus job growth, a robust residential pipeline, and major infrastructure improvements, the Miami area, too, has the ingredients for continued economic expansion.

“The region has a 3.4 percent unemployment rate, and the Miami MSA—Miami, West Palm, and Fort Lauderdale—has added 100,000 jobs over the past year and is projected to add 48,000 jobs each year for the next five years,” says Robert Given, vice chairman at Cushman & Wakefield in Miami. “In October, Spirit Airlines announced it will invest $250 million in a new Dania Beach corporate headquarters, moving 750 employees from Miramar [California] and adding another 250. We’re benefiting from companies who want to get out of states like New York and California. Miami’s population growth fuels everything. A lot of people now work from home yet do business all over the globe,” Given says. “The area is expected to add over 500,000 residents over the next nine years. That’s the equivalent of all the residents in Atlanta picking up and moving to Miami!”

The economy in communities around Tampa Bay also is robust, with the region reaping the rewards of development seeds planted years ago.

“We are buzzing and growing by 300 persons per day. We are one of the top 10 markets,” says Lucia E. Garsys, deputy county administrator in Hillsborough County. “Residential is full throttle; eds and meds are hot and a key source of job growth; medical centers have major expansions in the works. We’re also seeing an increase in what I call the ‘James Bond economy’—new companies doing innovative technology that existed before only in the movies. For instance, entities such as Softwerx are working closely with the Department of Defense to help solve challenging warfighter problems.”

And Orlando, where tourism has long been the primary driver of the economy, is reporting new industries springing up. “We are continuing to see an increase in diversification of employment growth across all sectors,” says Lisa Dilts, principal at Compspring, an independent real estate advisory company in nearby Winter Park. “Some of the recent employment sectors that have seen growing activity in the area include high tech, financial service, and logistics. Companies are choosing our market for the location and relative value compared with other top-tier metros across the nation.”

The 26-story, 742,000-square-foot (69,000 sq m) Ally Charlotte Center in downtown Charlotte is expected to be completed in 2021, with Ally Financial taking more than 400,000 square feet (37,000 sq m) of space. Developer Crescent Communities is seeking certifications including LEED, WELL Building Standard (a leading global rating system), Fitwel (a building rating system for commercial interiors), and WiredScore (which evaluates internet connectivity in commercial properties). (Crescent Communities)

Charlotte

The economy in Charlotte, North Carolina, is advancing at an impressive pace compared with the city’s peers. Job growth easily outpaces that in North Carolina and the United States, and 4.5 percent annualized growth in the first half of 2019 was the strongest since 2016, according to Moody’s DeAntonio.

“Private service providers are shouldering the burden as goods producers and the public sector have shed jobs over the past year,” he explains. “The unemployment rate has edged higher this year, but a surge in labor force growth is responsible for the jump rather than weakness in the labor market. Average hourly earnings growth of 4 percent year over year is outpacing the U.S. average thanks to a groundswell of new high-wage jobs. The strength of the labor market has pushed the multifamily housing market to its limits as development booms and rents soar.”

The area is expected to outpace the state and the country over the next year even as job growth moderates, DeAntonio says. “Finance, logistics, and health care will propel gains,” he adds. “Expansion of the financial technology landscape will lend support, and the prospect for a big tech win still stands. Longer term, stellar demographics and a business-friendly climate will attract investment and keep Charlotte a top performer.”

Beacon Partners’ Metrolina Park is a class A distribution park on a 135-acre (55 ha) site that formerly housed the Metrolina Tradeshow Expo in north Charlotte. The park contains over 1.8 million square feet (167,000) of space and was completed in 2018. (Beacon Partners)

As new jobs continue to be created through headquarters relocations and a new focus by major companies in the Charlotte market, mixed-use, office, and residential real estate will expand in the area, predicts Jason Munday, managing principal of the Charlotte office of SeamonWhiteside, an engineering and site design firm.

“We definitely see continued growth in the greater Charlotte area,” Munday says. “Job creation is strong. Truist Financial [the result of the BB&T and SunTrust merger] will be headquartered here. Additional major operations include Honeywell, Allstate, LendingTree, and WeWork. Lowes invested recently in a global tech hub. The industrial sector is also seeing an uptick in activity, and the city is rezoning over 1,500 parcels along the Blue Line light-rail corridor for transit-oriented development.”

Charlotte Douglas International Airport is one of the primary economic drivers behind the general economic success of the region, adds Morris, and the embrace of mass transit also positively differentiates the area, leading to additional real estate development. “The CBD [central business district] is a construction zone in and of itself,” Morris says. “Given the aging demographic all across America, hospitals and medical office presents huge growth potential as well. Building on that medical base, Novant and Atrium both seem to be in growth mode. That has huge potential for us.”

Crescent Communities’ 20-acre (8 ha) Escent Research Park, under construction in Charlotte’s University submarket, will have 158,000 square feet (15,000 sq m) of creative office space, with an expansive lobby and a two-story atrium. Escent is expected to be completed in 2021. (Crescent Communities)

Economic diversification bodes well for Charlotte’s future, says Elizabeth McMillan, senior director of development at Charlotte-based Crescent Communities, an investor, developer, and operator of mixed-use communities. “Finance is a current bright spot, with expansions of current banks like Ally Financial and Bank of America, and the announcement that Charlotte will be the new headquarters of Truist. Health care is also a leading industry in Charlotte, as noted with the recent news of expansion by Atrium Health,” she continues.

Ally Charlotte Center—a 26-story, 742,000- square-foot (69,000 sq m) office tower in downtown Charlotte with Ally Financial taking more than 400,000 square feet (37,000 sq m)—is expected to be completed in 2021.

“Charlotte’s Stonewall corridor has seen tremendous growth over the past five years,” she continues. “In addition to Ally Charlotte Center, a 400-room JW Marriott will also open in 2021. Projects along the Stonewall corridor include Legacy Union [where Bank of America took space and Honeywell is locating its headquarters], Crescent Communities’ NOVEL Stonewall Station with 459 luxury multifamily units and a ground-floor Whole Foods, plus other mixed-use residential like Uptown 550 by Northwood Ravin and Savoy by Proffitt Dixon.”

Even so, the area must deal with challenges such as affordable housing. “All residents must be able to afford to live in our city,” Morris says. “The Charlotte community is learning that lesson and how to get out of our political and sociology-economic boxes to innovate ways that offer every citizen the opportunity to enjoy a safe and vibrant community.”

Bond Brothers Beer Company in Cary, North Carolina, opened in 2016, replacing a carpet warehouse. The facility has a 10-barrel system with a 2,500-square-foot (230 sq m) tap room, a 3,500-square-foot (325 sq m) beer garden, and a 3,500-square-foot (325 sq m) brewery. It was designed by New City Design Group and developed by Northwoods Associates. (Duffy Healy Photography 2019)

Raleigh-Durham

North Carolina’s Research Triangle area, around the cities of Raleigh, Durham, and Chapel Hill, is enjoying significant positive momentum across all real estate market sectors, notes Marcus Jackson, principal and a member of Avison Young’s capital markets group in Raleigh.

“I believe the Great Recession improved our region’s competitive position against the nation’s larger cities,” Jackson continues. “Before 2008, we were considered a second-tier city in terms of size and investment climate. Now, we are an institutional investor darling and ranked by ULI as the number-two U.S. market to watch for real estate prospects.”

Reflecting investor enthusiasm for the market, the area experienced record-setting quarterly commercial real estate sales volume of $2.3 billion in the third quarter of 2019, bringing volume for the preceding 12 months to an all-time high of $5.6 billion, Jackson notes.

The rapidly growing region has witnessed strong rent appreciation while remaining an outstanding class A apartment value play for tenants and investors alike, Jackson says. “The Research Triangle has also undergone rapid urbanization in the last decade, with billions of dollars of public/private investment in our cities’ urban cores,” he adds. “ULI now classifies the Triangle as an 18-hour city, increasing our attractiveness to potential talent and investment dollars. There are always silver linings to our down cycles.”

New City Design Group of Raleigh transformed an old postal depot in Raleigh’s artsy Warehouse District into restaurateur Niall Hanley’s Morgan Street Food Hall, a 22,000-square-foot (2,000 sq m) hub for more than 25 businesses, including Makus Empanadas, Oak City Fish and Chips, and Cousin’s Maine Lobsters. The space opened in July 2019. (Duffy Healy Photography 2019)

The Raleigh-Durham region has become increasingly attractive to new residents and businesses alike, benefitting all facets of the region’s commercial real estate sector.

“Office development has increased notably but remains in line with robust tenant demand, fueling healthy leasing fundamentals and strong rent growth for landlords,” says Jackson. “Wegmans just opened its first North Carolina [grocery] store in Raleigh and has five more in the works for the local market. Early next year, Amazon is scheduled to open a 700,000-square-foot [65,000 sq m] multistory fulfillment center that uses robots—the first of its kind in the Triangle.”

The Raleigh-Durham area is experiencing a talent/education/quality snowball effect, says Ted Van Dyk, principal at New City Design Group, based in Raleigh. “Our strong academic centers are producing top talent,” Van Dyk notes. “Our tech sector continues to hire and expand, and the excellent quality of life is attracting more companies and talent to the region. Our prospects for growth are strong.”

Longer term, stellar demographics, a deep talent pool, and low business costs will spur investment in Raleigh-Durham, and the region will be a top performer among large economies in the South. “The state’s second-largest metro area will be an above-average near-term performer,” Moody’s DeAntonio says. “Job growth will slow but broaden with strength in consumer and ­knowledge-based industries thanks to in-migration and investment in high tech.”

The three-story, 8,500-square-foot (800 sq m) beer and cocktail bar Raleigh Beer Garden has one of the world’s largest selections of draft beers available in one restaurant. Designed by New City Design Group, Raleigh Beer Garden has a rooftop deck and over 3,000 square feet (280 sq m) of outdoor patio seating. (Duffy Healy Photography 2019)

Like other areas in the Southeast, Raleigh-Durham faces some clouds on the horizon. “Our challenge here, as in other emerging 18-hour cities, will be to manage growth and increase transit, infrastructure, open space, and the arts,” says Van Dyk. “Our success will be short lived without a cogent game plan for our rapidly growing region. Short term, however, our prospects are bright, and a new generation of leaders is emerging to meet our challenges.”

Atlanta’s Cooper Carry designed the master plan for Park Center, a regional campus being developed by Dallas-based KDC Real Estate Development & Investments in Dunwoody, Georgia. The firm also designed the first phase, a 585,000-square-foot (54,000 sq m) structure completed in 2016. Construction is underway on the second building, a 22-story office tower containing 670,000 square feet (62,000 sq m) of space. The project is pursuing LEED Silver certification. (Nigel Marson Photography Inc.)

Atlanta

Technology remains one of numerous bright spots in Atlanta’s urban and suburban environments.

“A strong, talented labor pool continues to foster jobs,” says Adam Schwegman, partner and senior vice president of retail leasing in the Atlanta office of North American Properties. “Creating the right environments in walkable centers of commerce for these skilled workers will be the challenge. Today, Atlanta is full of disconnected suburban office parks and strip malls. Trail connectivity is becoming a major trend, with the Beltline and Alpha Loop proving trails can become oceanfront property.”

Colony Square in Midtown—one of the city’s original mixed-use projects—is about halfway through a redevelopment that will help connect residents, he notes. “North American Properties is creating Midtown’s ‘living room’—walkable to transit; full of amenities; a community destination for office workers, neighborhood residents, and tourists alike at Colony Square,”

Schwegman says. “Next year we will open several new restaurants, a food hall, and a theater, all surrounding an active green space. Surprisingly, despite the fundamentals, this environment does not currently exist anywhere in the Midtown core.”

The convention and tourism sector also has seen significant growth, as have the major health care providers in the market, says Kevin Cantley, president and chief executive officer of Atlanta design firm Cooper Carry. “The growth of the film and music industries has led to the development of significant studio, soundstage, and related facilities,” he adds.

Above and below: North American Properties is renovating Colony Square in Atlanta’s Midtown. When completed in 2021, the reimagined Colony Square will encompass two office towers and loft office buildings totaling 940,000 square feet (87,000 sq m); 262 residential condos; a 466-room hotel; and 160,000 square feet (15,000 sq m) of entertainment, retail, and restaurant space, including food hall Main & Main.(North American Properties, Beyer Blinder Belle, Lord Aeck Sargent)

Every indication suggests that a significant volume of real estate development and construction activity will continue, says Cantley. “Demand continues to outstrip supply, as is indicated by ever-increasing rents across major market sectors, with only a few exceptions,” he adds. “The Atlanta Regional Commission projects Metro Atlanta will grow by 2.9 million people by 2050. Accommodating such a significant growth in population will require ongoing new development.”

One of the major developments underway in Atlanta’s north-central perimeter is Park Center. Designed by Cooper Carry, the development is anchored by 1.7 million square feet (158,000 sq m) of office space scheduled to be occupied by State Farm Insurance.

“It is a transit-oriented, mixed-use development in an area transitioning from dependent commercial uses to a walkable urban place that is now both commercial and residential served by an expanded MARTA [Metropolitan Atlanta Rapid Transit Authority] heavy-rail station,” says Cantley.

Design architect Duda|Paine Architects of Durham, North Carolina; architect of record HKS of Atlanta; and interior architect Gensler (Atlanta) collaborated on NCR’s 762,000-square-foot (71,000 sq m) global headquarters campus in Atlanta, which opened in October 2018. (Robert Benson Photography)

Design architect Duda|Paine Architects of Durham, North Carolina, record architect HKS of Atlanta, and interior architect Gensler (Atlanta) collaborated on NCR’s 762,000-square-foot (71,000 sq m) headquarters campus in Atlanta, which opened in October 2018. It is a project of developer Cousins Properties, owner’s representative JLL, and NCR. Located near Tech Square—Atlanta’s technology and higher education hub—NCR’s new global headquarters is expected to attract the next generation of engineers and creative employees entering today’s evolving workforce.

Los Angeles–based CIM Group’s $5 billion Centennial Yards, one of the largest mixed-use projects in the Southeast, is another example of still-robust building activity, says Moody’s senior economist Ilir Hysa. “The ongoing project will take 10 to 15 years to complete and includes new residential, hotel, retail, and office space, as well as enhancements in infrastructure and green space in the downtown area,” Hysa says.

“Construction activity will be supported by projects in the periphery of the metro area, too. For example, a 916-unit housing development is planned to be built in Peachtree Corners in Gwinnett County, about 15 miles [24 km] northeast of Atlanta.”

Robust building as well as expansion in outsize professional services and health care pushed the jobless rate to 2.9 percent in September, the lowest for Atlanta since tracking began. “In such a tight labor market, finding qualified workers will remain the main headache for builders and other employers,” Hysa adds. “A lack of significant wage pressures, especially in blue-collar positions, has some workers working multiple jobs to supplement their income and keep up with the higher cost of living.”

Designed by Duda|Paine Architects, the 118,000-square-foot (11,000 sq m) Emory University Student Center in Atlanta opened in May 2019. The structure is cooled and heated by geothermal wells. The historic East Dobbs University Center—the Alumni Memorial University Center and its marble facade—are preserved and integrated into the new design. (Duda | Paine Architects)

Georgia’s film industry also has been an economic boon for the real estate industry, notes Banks. “And it will continue to be so unless the folks down at the Gold Dome screw it up for the rest of us,” he says, referring to the “heartbeat” bill passed at the state capitol that would prohibit abortions after a heartbeat can be detected in a fetus.

With such economic success come challenges, of course. “Restaurateurs . . . are facing significant personnel shortages, as well as increasing food costs, construction costs, and rents,” says Banks. “Food and beverage sales may be up 4 percent this year, but we’ve increased the number of available seats by probably twice that. And as much as I wish differently, the answer to every empty retail space can’t be ‘put a restaurant in it.’”

Attainable housing is an increasing concern because multifamily development is not meeting increasing demand and rents continue to rise. “A path to more diverse and affordable housing may be through eventual overdevelopment, resulting in competition for tenants driving down rents,” says Cooper Carry’s Cantley. “Increasing traffic congestion is in many ways driving development to walkable urban areas served by transit, which is of limited supply. Also, suburban development is taking on a more walkable urban mixed-use form that greatly reduces the need for driving trips between single-use developments.”

Swire Properties’ Brickell City Centre, a mixed-use development in Miami’s Brickell financial district, is a planned 4.9 million-square-foot (455,000 sq m) development spanning nine acres (4 ha) and including two mid-rise office buildings, Two and Three BCC; two residential towers, Reach and Rise; a luxury lifestyle hotel with residences called EAST, Miami; and 500,000 square feet (47,000 sq m) of retail, dining, and entertainment space. The first phase of Brickell City Centre was completed in November 2016 with the opening of the project’s luxury and premium shopping center. The building of BCC will continue over the next decade. (Lifestyle Producton Group)

Miami

While residential rental is leveling off somewhat, office demand—particularly in the urban core—is strengthening, and industrial real estate remains a star performer in the Miami area, says Neisen Kasdin, managing partner of law firm Akerman’s Miami office and a former mayor of Miami Beach.

“Office is strong, with submarkets developing for hedge fund and private equity players like Barry Sternlicht and Carl Icahn relocating to the Miami area,” says Kasdin. “Triple-A condo locations for smaller luxury buildings continue to move forward. There is a lot of condo inventory, but no evidence of distress since the projects have low leverage with strong sponsors and large cash deposits before commencement of construction.”
The second phase of the Miami Design District has opened, Kasdin notes. The district is dedicated to innovative fashion, design, architecture, and dining experiences and is owned by Miami Design District Associates, a partnership between Dacra, founded and owned by entrepreneur Craig Robins, and L Catterton Real Estate, a global real estate development and investment fund.

In addition, the $4 billion mixed-use development Miami Worldcenter—second only to New York’s Hudson Yards in vision—is proceeding according to plans.

“Miami Worldcenter occupies 27 acres [11 ha] in the heart of downtown Miami and is one of the largest private real estate developments underway in the United States,” Given adds. “Some 85 percent of the projects have either gone vertical or are going to start in the next 12 months. Also, Virgin Trains USA has broken ground to expand passenger rail service from Miami to Orlando. Passenger service on Virgin Trains, formerly Brightline, from Miami to Orlando is expected to begin in 2022.”

Another impressive real estate development is PortMiami cruise terminals. Carnival Corporation, MSC Cruises, Norwegian Cruise Line Holdings, and Virgin Voyages are each building enormous cruise terminals at PortMiami. Total construction costs exceed $1 billion, says Kwame Donaldson, senior economist at Moody’s. “In addition, Virgin Trains just reached a deal to connect the cruise terminals via high-speed rail to other cities in South Florida and Orlando,” he adds.

The Miami-area economy will grow in the short run, but a global slowdown could be a challenge, Donaldson predicts, adding Miami’s international character and its high-skilled, bilingual workforce will help it outperform the nation in the long run.

“Though the area’s jobless rate has dipped to a 12-year low of 3.2 percent, the decline over the last year has been the weakest since the start of the recovery,” he says. “Average hourly wages have reached an all-time high, but wage growth has retreated to less than 1 percent, much slower than the statewide and national rates, which are above 3 percent. After accelerating at the end of [2018], house price growth slowed in the first half 2019.”

Long term, the need for improved transit stands out, says Kasdin of Akerman. “Future development will need to be on the higher—and resilient—coastal ridge and the surrounding neighborhoods, which can be redeveloped and accommodate the density necessary to support transit,” he says.

The 83,000-square-foot (8,000 sq m) Center for Health & Wellbeing in Winter Park, Florida, opened in February 2019. The Winter Park Health Foundation is the developer and primary owner of the facility, designed by Duda|Paine Architects. The center brings fitness, medical care, and wellness into one integrated building for holistic and preventive care.
(Lifestyle Production Group)

Orlando

Moderate costs, a high quality of life, robust in-migration, and a thriving tourism industry are expected to propel long-term growth in Orlando.

“The economy in Orlando area is stable,” says Donaldson of Moody’s. “The area’s unemployment rate, 3 percent, has hardly changed over the last year as wage growth outperforms the statewide and national rates,” he says. “After falling through the first half of 2019, these higher wages have drawn workers from the sidelines and led to a recent uptick in the size of the labor force. House price appreciation has slowed to less than 5 percent, though it has outstripped the statewide and national pace each of the last 13 months.”

Billions of dollars in public and private investment has been committed to the region, including Interstate 4 reconstruction (known as the I-4 Ultimate Project), a $2.3 billion rehab of Orlando’s principal thoroughfare, according to Donaldson. In addition, Universal’s Epic Universe is a planned 750-acre (304 ha) addition to Universal Orlando’s collection of theme parks. The expansion is nearly equal in size to the resort’s current offerings, he says.

Also, the south terminal expansion underway at Orlando International Airport is planned for completion in 2021, says Dilts. “Within the terminal, an intermodal facility is being constructed that will eventually provide connections to the Virgin Trains USA line from South Florida, and a potential connection to Orlando’s commuter rail, SunRail,” she says.

The south terminal expansion underway at Orlando International Airport is planned for completion in 2021. An intermodal facility accessible by walkway that will eventually provide connections to the Virgin Trains USA line from South Florida, and a potential connection to Orlando’s commuter rail, SunRail, was completed in 2017. (Greater Orlando Aviation Authority)

Over the next year, Dilts continues, “we anticipate Orlando to remain a top market for economic growth. Having said that, we do predict a slowdown in achievable land values. We are seeing an inflection point where the prices being paid for land and escalating land values are not translating to the same achievable increases in rents and home prices that people are able to pay.”

While the region retains a competitive value in comparison with other job centers across the country, Dilts notes, “we are not immune from the challenges of providing attainable and affordable housing to the workforce. For the region to continue to grow and house the workforce, we will need to continue pursuing creative solutions. These will come in the form of increased permissible density, waived impact fees or fees that are tied to the unit size, and innovative construction technology.”

The University of South Florida’s Morsani College of Medicine is slated to open a 395,000-square-foot (37,000 sq m) facility in downtown Tampa, with classes for its doctor of medicine program expected to start in January. The Morsani College of Medicine is a key anchor in the $3 billion redevelopment of downtown Tampa’s Water Street district. (University of South Florida)

Tampa/St. Petersburg

Eds and meds are one of the major growth sectors in the Tampa Bay area, with a lot of medical space coming out of the ground, Garsys says, adding that the seeds were planted and nurtured years ago. The Morsani School of Medicine at the University of South Florida is slated to open a 395,000-square-foot (37,000 sq m) facility downtown, with undergraduate medical education courses expected to start in January 2020.

“The H. Lee Moffitt Cancer Center & Research Institute—a nonprofit cancer treatment and research center—and AdventHealth are working to open an outpatient cancer center on the campus of AdventHealth Wesley Chapel in Pasco County,” she adds. “The outpatient center is expected to open in the fall of 2020.”

Another major real estate development that is continuing: Water Street Tampa between the Port and downtown Tampa, led by Strategic Property Partners. The project’s plans call for the addition of 9 million square feet (836,000 sq m) of new space. The Water Street Tampa neighborhood will include the first new downtown office towers in nearly 25 years and the first for-sale condominiums in almost a decade.

The Tampa/St. Petersburg area’s unemployment rate has edged lower over the past year, from 3.3 percent to 3.2 percent, says Donaldson. Weakness in the labor market is reflected in the housing market, which is showing price appreciation at its slowest since 2012.

“The economy in Tampa–St. Petersburg–Clearwater will slow as the next downturn takes a toll on migration into the region,” he predicts. “Public institutions will provide support during the slowdown, but a lack of regional cooperation is a risk to faster growth. The area’s high quality of life and moderate cost of living brighten its long-term prospects.”

Barring a global financial meltdown, America’s Southeast region is expected to continue its economic expansion in the years ahead. But the region must also tackle major concerns such as affordable housing, transit, and increasing building costs, too.

MIKE SHERIDAN is a freelance writer in Richmond, Virginia.