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The Sarasota/Manatee submarket may be saturated with new hotels and apartments for now, but new and modern industrial space is still needed to keep pace with macro-changes in the way products are shipped.
That's the conclusion of a panel that assembled earlier this month at the Sarasota Yacht Club to discuss “Current Trends in Real Estate Investing” sponsored by the Association of Corporate Growth (ACG).
“It seemed like we didn't have any new hotel development in Sarasota for a long time,” says Angus Rogers, president and CEO of Floridays Development Co., a Sarasota-based firm that is preparing to open a Marriott Autograph Collection, arts-themed hotel downtown next month.
“Now, though, there's a lot of new supply in this market.”
Floridays' hotel is among a handful of new hotels that have either recently been completed or are in development containing more than 800 new rooms. In addition to the 162-room Art Ovation hotel Floridays and partners are developing, more than 800 new hotel rooms either have been recently delivered or are about to be in downtown alone.
“We're pretty well saturated with new hotel rooms for now,” Rogers told the ACG group. “The key is you have to differentiate yourself. It's really evolved, how hoteliers address the product they want to deliver.”
Likewise, industrial space remains a sector where not much new development has occurred during this eight-year growth cycle — which represents opportunity.
Kirk Boylston, president of Lakewood Ranch Commercial Realty, says new industrial space is needed to match changes in the way warehouses fit into today's fulfillment system.
“I'm a huge believer in industrial development,” he says. “There's huge demand out there.”
From an investment perspective, Boylston notes industrial space -- contrary to office projects — typically have low turnover and low tenant improvement costs overall.
“If you build good, quality industrial product you'll get good users,” says Boylston, whose firm sold land to developer Harrod Properties for new industrial space in 2016.
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