PANAMA CITY BEACH — In the words of commercial real estate adviser Kevin Wattenbarger, the market came clean in 2013.
Wattenbarger, an adviser at Sperry Van Ness in Panama City, said the firm nearly doubled its volume of commercial real estate transactions in 2013, with about a 20 percent increase in both improved commercial property sales and vacant commercial property sales.
“The bad news has been delivered,” he said. “We’ve hit bottom and we’re starting to come up.”
Brian Hinton, chairman of the commercial investment division for the Bay County Association of Realtors, echoed Wattenburger’s findings.
“From a purchase standpoint, we closed more commercial sales in 2013, probably about twice as many as the year before,” said Hinton, who owns Panama City commercial real estate firm Site Solutions. “Across the board, in commercial real estate in general, we saw a lot more activity.”
The Bay County Association of Realtors reports residential real estate data based on information from the Bay County Multiple Listing Service (MLS), but because commercial brokers do not use a uniform resource to exchange data, sales rates were not available for comparison.
Hinton also cited an increase in lease rates for commercial space due to an uptick in demand and fewer overall vacancies for commercial properties.
“The trend was, for two or three years, the demand was lessening so people were lowering the prices,” Hinton said. “In general, you can see all of the lease rates have been sliding for two or three years and now they’re starting to stabilize.
“There’s starting to be more demand for the space we already have and less vacancies.”
Slower areas
Some areas, however, have not seen as much improvement as others.
“We’re not seeing those kind of increases in the development of raw land,” Hinton said. “There’s certainly a greater demand for existing sites, which is a nice thing to be able to say.”
Wattenbarger also cited land as the most challenging sector in the Bay County area.
“Land is probably the most challenging of all the segments we’re dealing with,” Wattenbarger said, noting slow sales in large acreage parcels and especially non-entitled land. “It’s the most challenging asset that’s out there right now.”
Wattenbarger said there have been challenges in finding suitable locations for businesses in Panama City.
“That’s definitely an issue we’re trying to overcome,” Wattenbarger said. “I would anticipate new development in general for Panama City, but it’s a bit more challenging because there’s not the availability of land that you’re seeing on the beach.”
Despite those challenges, he said the Bay County area still saw an increase in business expansion overall.
“We definitely saw more businesses expanding last year, taking advantage of low interest rates,” Wattenbarger said. “The confidence is up and people are expanding their businesses.”
Sperry Van Etten has been working on some “feel-good” projects that will bring jobs to the area, he said.
“There are definitely some projects out there that we’re working on that will bring high paying jobs,” Wattenbarger said. “That’s one of the best takeaways in having some confidence in the future.”