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Business Observer Friday, Nov. 17, 2017 1 year ago

Economic Forecast 2018 - Sarasota and Manatee

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After a good year, the area will continue to be strong

Distribution

Alex Miller
CEO | Mercedes Medical, Sarasota
Company:
It has been a good year so far for medical supply distributor Mercedes Medical. Miller says the company will have a little more than $40 million in revenue this year, and it anticipates doing close to $45 million next year. In 2018, the company will build a new $10 million headquarters and distribution center in the health care and life sciences business park dubbed CORE, in Lakewood Ranch.

The official groundbreaking ceremony for the Mercedes Medical facility will be held in January, and Miller says the company hopes to move in by Thanksgiving 2018.

Now the company is in three separate buildings totaling about 30,000 square feet, so it will be nice to consolidate everyone, she says, in the new 60,000-square-foot space. Miller says the company, with some 60 employees, plans to expand within the markets it's been focusing on for the last few years, including toxicology because of the opioid addiction crisis. She says Mercedes Medical is also moving more into the life science and research market. “As the industry evolves,” she says, “we as a distributor evolve.”

Industry: Miller says she thinks the industry will continue to consolidate in 2018. “There's so much private equity money,” and those firms “love life science right now.” There's also a move toward smaller instruments, Miller says. The “microtization of laboratory equipment” is “happening pretty quickly.”

Region:
While the local economy has little impact on Mercedes Medical's national business, Miller believes the region is doing well. She sites the influx of new residents and companies increasing payrolls as two strong signs she thinks will carry on into 2018.
— Grier Ferguson

Health care

Valerie Powell-Stafford
CEO | Englewood Community Hospital, Englewood
Company:
Englewood Community Hospital did well this year, says CEO Powell-Stafford. Although the hospital, part of HCA's West Florida division, doesn't publicize revenue figures from individual facilities, she says net revenue in 2017 is up over the previous year, and surgical volume is up 20%. It's planning a big 2018, too. “Next year, the hospital's focus will be to continue to increase the level of services we provide to help the needs of our community,” she says. The idea is for patients to not have to seek health care outside of the area. Powell-Stafford points to a cardiovascular procedure — percutaneous coronary intervention — that patients used to have to go elsewhere to receive. Now it can be done at Englewood Community Hospital. In 2018, the hospital is also looking forward to an expansion of the emergency room capacity. More than 80% of the hospital's admissions come from the ER, Powell-Stafford says. It also plans to expand its robotic surgery program.

Industry: Powell-Stafford says the health care industry has been stable, but it's not without its challenges. Some of the challenges facing the industry, she says, are the instability of the Affordable Care Act, the opioid crisis and the rising cost of prescription drugs.

Region: “This community is a growing community,” Powell-Stafford says, adding that it's good to be in one of the fastest-growing MSAs in the country. One major change to the area that will impact the hospital, she says — the massive West Villages planned community to be developed near the hospital along with an Atlanta Braves spring training complex.
— Grier Ferguson

Homebuilding

Pat Neal
President and CEO | Neal Communities, Lakewood Ranch
Company:
Pat Neal expects Neal Communities to achieve its big goal this year to sell 1,168 homes. Until Hurricane Irma, he says the company was ahead of that budget. Then Neal Communities took over a week to prepare for the storm, and after the storm, he says, people stayed away for a while. He thinks the company lost about 55 sales because of Irma, but is working hard to get back on track. In 2018, Neal plans to open 10 new communities, including three in Manatee County, three in Sarasota County, two in Lee County, one in Hillsborough County and one in Collier County.

Industry: Neal says this is a time of consumer confidence in the market. Plus, there's no oversupply of homes like there once was. “We're beginning to have an excess of demand and an undersupply of the number of new homes,” he says. One major issue facing the homebuilding industry, though, is labor issues. “Today we don't have very many young people who graduate from local high schools who automatically enter the construction trade,” he says.

Region: About 57% of Neal Communities' home sales are to people who aren't from the region or even have a Florida address when they purchase a home. “They're choosing our good weather and beautiful environment,” Neal says, along with a positive economy and low taxes. Adds Neal: “Things are as good this year as they've been any year of the 47 years I've been a homebuilder because of demand, a healthy economy and people who want to come live in our state, and all we have to overcome is our deficit of labor.”
— Grier Ferguson

Staffing

Stuart Kortie
Partner and Vice President | HH Staffing Services, Sarasota
Company:
Employment agency HH Staffing Services will end 2017 at the “top end of our success,” says Kortie. Because of internal staff changes in 2016, he says, “the second half for us has been particularly strong, and we're going to end up with the strongest sales we've ever had.” Kortie says the company will be approaching $4.6 million in revenue in 2017. In 2018, HH Staffing is expecting more growth and is looking toward surpassing $5 million in sales.

Industry: Kortie says that barring any sudden changes, the staffing industry is in good shape. “The economy is doing well, and business is good,” he says. “We'll just have to see how things play out politically and geopolitically. There are a lot of things being done to promote business and policy.”

Region:
HH Staffing — with locations in Sarasota, Tampa, Orlando and Fort Lauderdale — is positioned in several key markets in the state. “Everywhere you go, you see growth,” Kortie says. “Orlando is absolutely incredible with regard to growth. It's amazing. It's going to be doubling in size as a city.” He says Sarasota is growing, too, but not at the same rate as metropolitan areas. HH Staffing has been asked to open up more offices, but it's not a move the company would make suddenly. “We really like to control our growth and be really methodical about the way we grow,” he says. “We've always had the philosophy of being better before we get bigger.”
— Grier Ferguson

Hospitality

Jane Storey
Owner | The Londoner Bed and Breakfast, Bradenton

Company: Owner Jane Storey says The Londoner Bed and Breakfast in Bradenton did really well in 2017 until a certain point. In mid-June, she says, “business fell off, and it's just now starting to pick back up. We don't know why it was our slowest summer.” One possibility? Rainy weekends. “I do believe a lot of my summer business, besides being European visitors, is staycationers, and you're not going to go on vacation when it's raining.” In 2018, she's expecting the busy season to go well. “I'm already filling up in January, February and March.” Some of her bookings, she says, come from Bradenton being the spring training home of the Pittsburgh Pirates. This is the third year Jane and her husband, Jay, have owned The Londoner. Next year they plan to add a fresh coat of paint on the house and greater efforts to market The Londoner's tearoom, often booked for bridal showers, women's groups and birthday parties.

Industry: For the hospitality industry at large, she has her fingers crossed for a solid 2018. “I'm hoping the hospitality industry grows stronger,” Storey says. “I'm hoping people feel confident and can go on vacation.”

Region: “I think Manatee County is trying to become more of a destination area than it has in the past,” she says. The area, she adds, has a couple big wins going for it — the boost Southwest Florida and the whole state gets from spring training games is one example. Another example is the weather. “When it's zero degrees and snowing,” Storey says, “people tend to want to come to Florida.”
— Grier Ferguson

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