ULI speaker: Midwest a disaster

A presentation last month at the Urban Land Institute's Trends Conference raised some eyebrows and lowered some hopes.

Domain Capital Advisors founder Patrick Leardo highlighted several trends that could have a significant impact on Gulf Coast businesses in 2010.

First, markets have not found equilibrium pricing.

Despite the fact that the economy has been slogging through a recession for two years, many property owners remain convinced that their properties are worth more than the market says they are worth — a formula that will doom recovery until it is resolved.

Says Leardo, “Spreads between bid and ask just don't make any sense.”

And price spreads for new and existing homes remain too small to merit a pick-up in new construction. Leardo asks, “Why build anything when you can buy more cheaply?”

And second, Leardo drew attention to an issue that local business leaders have no control over: problems in other regions of the United States that could create more challenges for Florida.

Specifically, he said the struggles of the country's Midwest region may become a weight on the Gulf Coast. “This is a disaster,” Leardo said. “There is no prospect for this sector improving.”