Three and Done for Ikea?

Ikea’s May 6 opening in Tampa is generating as much media excitement as if it were the second coming of Disney World. Stands to reason, since the 353,000-square-foot store is a lot like a home furnishings theme park.

The Swedish retailer, which has nearly 300 locations worldwide, will now have 37 stores throughout the US, including three in Florida. The first two opened a year and a half ago in Sunrise and Orlando, and the Tampa store is actually opening well ahead of its original late-summer plan.

Consumer Confidence Gains Six Points

Consumer confidence is on the rebound in the Sunshine State. The University of Florida’s latest index shows a six-point gain to 71 in April amid indicators of flattening housing prices statewide and news that the economy hasn’t gotten worse.

“The size of the increase comes as somewhat of a surprise,” says Chris McCarty, director of UF’s Survey Research Center at the Bureau of Economic and Business Research in Gainesville. “We had expected confidence among Florida’s consumers to move up and down in a fairly narrow window from the low to the upper 60s.”

Nobody’s Cheering for No. 3

South Florida used to be the one part of our state that commercial real estate could always rely upon. Now it appears the biggest drag.

The southernmost tip of the peninsula now has the distinction of being the nation’s third-worst market for distressed assets, with 232 properties totaling $6.3 billion in bad loans, according to Real Capital Analytics. Only New York City ($9.2 billion) and Las Vegas ($8.1 billion) are in worse shape.

Trader Joe’s In Expansion Mode

Many of you who read this blog on a regular basis have expressed keen interest in bringing Trader Joe’s to Florida. We may have some good news on that front, though it’s a bit of a stretch.

During this month’s GlobeSt. Webinar on the retail sector, Bernard Haddigan, senior vice president and managing director of Marcus & Millichap, said Trader Joe’s is among several retailers growing in response to the tough economy. “That goes back to a broader theme of necessity versus discretionary, so the necessity type retail continues to expand,” Haddigan said.

At the Beach, It’s Called Undertow

Late last week, the St. Petersburg Times published a fairly extensive article about the huge numbers of proposals filed with the Florida Department of Community Affairs for proposed real estate developments statewide. There are ridiculous amounts of new homes on the horizon, along with nearly half a million square feet in supporting commercial development such as shops, restaurants and offices.

Granted, none of this is likely to ever be built because financing is still hard to come by, and will likely remain so for as long as the economy remains mired in a recession. Some may consider it hope for the future, but how much hope can there be when Florida already has an excess inventory of completed homes that could take years to sell off, possibly being added to in the meantime by continuing foreclosures?

Ports Without Water? It Could Happen

Intermodal cargo containers are a common sight at Florida’s ports, and soon they may become more common in open fields, farther from shorelines. Two proposals are in the works to develop so-called “inland ports” where big Lego-like boxes will be stacked, awaiting delivery or export.

Palm Beach County leaders have approved land-use changes for an industrial complex to be built on more than 300 acres south of Lake Okeechobee, according to this report by the Palm Beach Post. Meanwhile, The Tampa Tribune writes that a California developer looks to replace a pepper farm in south Hillsborough County with the same type facility.

Grove Sound-Off: Does Media Control CRE?

My colleague Ian Ritter has a pretty interesting take at the Counter Culture blog about whether retail sales are affected by media reports. He also includes a video snippet from Fox Business where researcher Britt Beemer (speaking from Orlando, incidentally) is being, shall we say, “used” to advance the network’s Obama-is-wrong agenda. Fair and balanced? Well…

Yeah, I know, criticizing the press—and the president—is occasionally justified, and I bet I’ve heard it all in a quarter-century of attaching nouns to verbs. Anyone who thinks they have something new to add might as well try to reinvent the wheel while they’re at it. But I digress.

Now, here’s my real question: Does the doom and gloom being reported lately really affect what’s happening with commercial real estate?

Opportunities in Fractured Condos

Changes to Florida’s condominium rules could open the way for beneficial opportunities for developers. However, one expert warns that owners should proceed with caution when converting for-sale units to rentals.

Kelly Oliver, investment advisor and multifamily property specialist with Grubb & Ellis|Commercial Florida in Tampa, says many projects have come under “fractured condo” status, which happens when a rental apartment complex is converted to condos but too many units remain unsold. “That’s happened all over Florida,” Oliver says.

A Corus Not Worth Joining

Chicago-based Corus Bankshares Inc. announced this week that it has a massive amount of bad loan exposure in South Florida condominium and apartment projects. The South Florida Business Journal reports that Corus ended 2008 with more than $1 billion in 17 loans, most of which were nonaccrual.

Corus noted in its annual report that it has outstanding loans on more than 3,000 completed and under-construction units in South Florida. As a whole, the bank says it lost $456.5 million last year and its ability to continue as a “going concern” is in jeopardy.

Is Orlando Getting Over-Hoteled?

Even as the nation’s second-largest hotel market, many who have visited Orlando over the years sometimes still occasionally had trouble finding decent rooms for one or several nights. The situation now appears to have corrected, thanks (or no thanks) to the recession.

Our recent report on the hotel market states that over 4,000 hotel rooms are being added to the nation’s theme-park capital this year, with more planned into 2011. Last week, the Orlando Sentinel issued a more detailed report on the situation, including expansions of existing megahotels. Now comes this note that Orlando hotel occupancy fell 26% year-over-year in the final week of March, the biggest drop among leading US markets.