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Coffee Talk
+ Gulf Coast banks
in the doghouse
It's been no fun being a publicly held bank company lately, especially on the Gulf Coast of Florida.
After the recent troubles at Fannie Mae, Freddie Mac and IndyMac, investors unloaded Gulf Coast banks whose stocks trade on a major exchange.
For the year-to-date, four Gulf Coast banks have seen substantial declines in their stock prices, with the sharpest drops coming in recent days. They include:
• Bank of Florida in Naples (symbol: BOFL; recent price, $4.25; year-to-date return through July 15, ‑63%);
• First State Financial in Sarasota (FSTF; recent price, $4.30; year-to-date return through July 15, ‑56%);
• TIB Financial in Naples (TIBB; recent price, $4; year-to-date return through July 15, ‑53%);
• First Community Bank in Pinellas Park (FCFL; recent price, $7.38; year-to-date return through July 15, ‑33%).
For those brave enough, this may be an opportunity to buy bank stocks that are now trading below book value, unheard of just a few years ago. But be forewarned: As one banker recently quipped, who knows what book value really is?
+ Bottom-hitting talk lingers on
Talk of hitting the proverbial bottom of the Gulf Coast's residential real estate market malaise has been percolating for months - but clearly the chatter hasn't led to any consensus.
First there's Lakewood Ranch-based homebuilder Pat Neal, ever the optimist. Citing a pile of positive mid-year sales numbers at Neal Communities, the longtime homebuilder is talking like the bottom is tantalizingly close.
"You don't know if you've seen the bottom until you can see it in the rear view mirror," Neal told Coffee Talk recently. "Now we can see it."
Of course, Neal's vision is somewhat blurred by the fact that the sales boost is because home prices have been cut. That's part of the reason the company closed on 18 new home sales in June, for a total sales volume of $10. 5 million. Individual price ranges on those sales from as low as $176,000 for a small cottage home in North Manatee County to as high as $1.6 million in the Country Club at Lakewood Ranch in eastern Manatee County.
Neal's bottom-busting evidence even reaches as far back as the end of last year, when sales were so strong that the company made the 2008 nationwide list of the top 400 homebuilders by closings, published by Professional Builder magazine.
Standing in starkly opposed to Neal are pockets of Realtors and agents throughout the Gulf Coast selling homes made by all builders.
From talk in those circles at various networking meetings and conferences over the past few weeks, the bottom isn't exactly afoot. Indeed, in a July 14 Wall Street Journal story on tips for how to sell a home in the current market, a comment from a Tampa-area Realtor stands out: "At best, I think we're a year from the bottom," Realtor Sally Bodmer tells the paper.
Still, comments like that could be seen as downright cheery when put up against a July 14 report titled "How Far Will Housing Prices Fall?" published by well-known Wachovia economist Mark Vitner. "The current housing slump is without precedent," Vitner writes, "both in terms of breadth and magnitude."
While that's not exactly breaking news, Vitner says it did lead to complications in studying the market. His final call: "Home prices will likely bottom out sometime between the middle of 2009 and the middle of 2010."
There you have it. The future is, well, unknown.
+ How to get
balanced in life
A common refrain among ambitious business people - especially each class of the Review's 40 Under 40 - is that elusive quest for finding balance in their lives.
Charles Lowery, Ph.D., motivational speaker and chief executive officer of the Lowery Institute for Excellence Inc., shared his BALANCE formula recently with members of the CEO Council of Tampa Bay. It goes like this:
B - Boundaries. "You live your life by pressure or priority," Lowery says. "You need boundaries. You have to set boundaries on what you're going to do and what you're not going to do."
Lowery says people typically want comfort instead of clarity when they become stressed. But he cautioned his listeners to think beyond going for "immediate pleasures" because choices often have long-term consequences. And those consequences should be considered.
A - Attitude. "Cultivate an attitude where you focus on the good stuff," he says. He told the story of teaching his daughter how to ride a bike in a parking lot. She was afraid she would run into a light pole in the expansive lot. "We always focus on the pole ... on the wrong things," Lowery says. "Attitude becomes a discipline."
L - Long term. "Take the far look in life. Live by seasons and not by seconds. Good things take time."
A - Accept responsibility. "Don't go through life blaming other people for your unhappiness," Lowery says. "Put the past behind you. Face Forward. "You learn from the past, but don't live in the past.
"When good flows from you on a continual basis, good will flow to you," he says. "If you can serve people out of who you are, you're going to have a great life."
N - Narrow your focus. "Narrowing your focus allows you to discover that less is more when you operate from your strengths. Narrow your focus so you can serve from who you are," he says.
C - Communicate. "People are more like a combination lock than a lock with one key. You have to learn the right combination to open their potential. Communication allows you to discover just the right numbers for relating to others.
"The key to life," Lowery says, "is being able to communicate."
E - Enjoy. "Enjoy what you have," Lowery says. "If you're not careful, you'll let getting to the next level destroy the level you're in."
For Lowery, the Monopoly game of life is not about living on Boardwalk or Baltic. He says: "Faith, family and friends. Those three things never go back in the box."
+ New office product
emerges more slowly
Crescent Resources has built some of the Gulf Coast's newest and most distinct Class A corporate office buildings, including three in Tampa's Westshore business district on Boy Scout Boulevard with tenants like OSI, parent of Outback Steakhouse.
It is now building another, an eight-story, 250,000-square-foot stone and glass structure at Lois Avenue and Boy Scout due to open before year's end.
But it is one of the few.
It was originally thought that Crescent's building, plus MetLife's 10-story, 250,000-square-foot office tower and TriPoint Plaza, would usher in flood of other new office product in the Tampa Bay area.
Actually, a lot of that other new product may now be delayed as developers wait out the economic rebound, Lud Hodges, vice president for Crescent in Tampa told Coffee Talk.
"In today's climate, there's no way to do office development without pre-leasing," Hodges says. "Westshore has been a very good office market, if you've got the right location."
Unlike the earlier Crescent buildings in Tampa, the newest is slightly shorter - eight stories instead of 10. That's because of aviation authority restrictions.
However, the floor footprint is bigger, offering tenants other options.
The key for speeding up the commercial real estate recovery, Hodges says: job growth.
"Job growth is our life blood," he says.
+ Tattle-Trail
in the market
Another company has emerged from the Star Center business incubator in Largo: Tattle-Trail LLC.
Tattle-Trail has created a monitoring product about the size of a garage door opener that allows a driver to see the vehicle he's towing, in case there is a flat tire or mechanical problem behind him.
The company started selling the Tattle-Trail about a month ago and is getting interest from around the world. It lists for $598.
One customer was driving a 45-foot motor home and the car he was towing caught fire and blew up. He was happy to have Tattle-Trail so he could get off the road.
Another customer was towing a SeaDoo watercraft with an Acura and the trailer holding the SeaDoo blew a tire. The monitor helped him control the trailer.
Jim Aid, president of Tattle-Trail, races boats and cars, so he had various experiences while towing that were the genesis of his idea for the monitor.
"I had a problematic trip," Aid recalls. "I knew a better product was needed."
Tattle-Trail uses a new technology, similar to the Nintendo Wii, that tracks motion. Using heavy math algorithms, the product relays a video signal using wireless communication.
+ Networking group
mixes blogging with eating
A networking group for small business owners and entrepreneurs in Sarasota has added a twist to the standard lunch meeting: Combining it with an online network.
The group goes by the name the Young Entrepreneurs of Sarasota, which clearly doesn't define it, as there is no age limit to joining. The in-person activity takes place every Tuesday at 11:45 a.m. at Clayton's Siesta Grill on Old Stickney Point Road in Sarasota. The group meets for lunch and networking, with numbers reaching as high as 75 people for some recent events.
The online part comes from www.yes941.com, a free Web site the group set up for users to have their own page and blog, where they can pitch their products, and a discussion board, where users can seek help with a business issue. The Web site also has a member's directory, phone numbers and e-mail addresses.
+ Special committee
not so special anymore
What's so special about the special committee?
Not much, apparently.
On Friday, June 13, Bonita Springs-based homebuilder WCI Communities formed a special committee to evaluate proposals to restructure the struggling company. Former WCI Chairman Don Ackerman led the committee and we found out in securities filings a few days later that billionaire investor Carl Icahn was negotiating an undisclosed deal with WCI.
Icahn owns nearly 15% of the company and is currently chairman of the board. Under Ackerman's leadership, WCI has previously rejected a $22-per-share offer by Icahn. The stock now trades below $1.50 a share.
On July 15, barely a month after it was formed, WCI dissolved the special committee and said it wasn't talking to Icahn anymore.
Never mind.
Speculation is rampant about what's next. Among the possibilities is that Icahn may buy the debt of the company, which could keep WCI from being forced into bankruptcy reorganization. Icahn has said in the past that WCI's land and other assets have more value than what investors believe today.
We'll find out when appraisers hired by WCI complete their work soon and the company reports its next quarterly earnings.
GULF COAST RETAIL
What the data shows: The index of retail activity is constructed to measure personal consumption and it combines the categories of autos, consumer durables, tourism and consumer nondurables. The index's base equaled 100 in 1988. For example, an index of 300 today would have taxable sales equal to three times the base period in 1988, or a 200% increase.
What it means: An early Easter in March didn't help retailers in April and made year-over-year comparisons difficult. The wealthier enclave of Naples seems to be withstanding the retail downturn the best of any area on the Gulf Coast on a percentage basis. However, every area of the Gulf Coast showed steeper percentage declines than the state average.
Forecast: Any decline in oil prices will help consumers, but the rising unemployment rates in every area of the Gulf Coast foretell a tough retail environment this summer. The euro and the British pound continue to be strong against the U.S. dollar, a blessing if Europeans visit the Gulf Coast this summer in any great numbers. Advice to retailers: Brush up on your German and learn to convert euros and pounds into dollars quickly.
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